SOMBA K'E/YELLOWKNIFE - De Beers Canada has cancelled its four-week December production shutdown at the Snap Lake Diamond mine.

The news comes two weeks after Rio Tinto, majority owner of the Diavik diamond mine, cancelled its own winter shutdown.

"We've met with all of our employees on site and in Yellowknife and will continue to meet with employees coming back to site (on their rotations)," said De Beers Canada spokesperson Cathie Bolstad. "We're working to accommodate any employees who had made plans to be off."

After visiting with workers at the mine, Bolstad said, "I think there's a sense of relief, a relief in terms of they're seeing positive signs in the industry."

Responding to a reduced demand for diamonds worldwide, De Beers shut down Snap Lake from July 22 to August 26, with only 60 workers remaining on site per rotation. The company also reduced its rate of production to align with slumping demand.

Even with December production back on the schedule, the mine's rate of production is "still a curtailed production rate and significantly below the mine's capability, which is 1.5 million carats per year," said Bolstad.

In 2008, the mine, which officially began commercial production halfway through the year, produced 926,000 carats, accounting for 6.9 per cent of diamonds produced in the NWT that year.

Bolstad could not provide a production estimate for 2009 as of press time.

As for next year, Bolstad said, "A number of scenarios have been presented and have been making their way through the family of companies and there's a series of approvals associated with that.

"We anticipate we will have a decision from our board of directors on De Beers Canada's 2010 plans early in November."

Snap Lake currently employs 584 direct De Beers employees and contract workers. Of those employees, 251 live in the NWT.

De Beers' shutdown cancellation is the latest in a series of positive signs that suggest the Yellowknife diamond industry is regaining its health after summer production shutdowns and staff cutbacks at the Diavik and Snap Lake mines.

Earlier this week, Arslanian Cutting Works announced it has rehired an additional 14 cutters and polishers, bringing the total number of staff at the plant to 19. The company, which employed 35 people before the financial meltdown, hopes to rehire more employees early next year.

In addition, the HRA Group of Companies, which owns the Crossworks Manufacturing plant, stated it plans to significantly expand its small plant, which currently employs 11 people.