Doug Ashbury
Northern News Services

Yellowknife (Feb 09/00) - When it comes to Diavik's environmental agreement, the last big issue on the table is the security deposit, Diavik Diamond Mines Inc. spokesperson Tom Hoefer said Tuesday.

Of the 18 articles in the agreement, 17 are "substantially" resolved, Hoefer said.

The remaining article that needs work is the amount of the security deposit and the rules which govern how it might be accessed and applied, he said.

"We've put forward a proposal for security, DIAND (the federal Department of Indian Affairs and Northern Development) has recommended a security level above that," Hoefer, the company's public affairs manager, said.

"This is a very complex agreement. It involves eight parties (Diavik, two governments and five aboriginal groups). This type of agreement has not been done before. We're breaking new ground," Hoefer said.

The deposit would serve as a safety net. If DIAND is forced to pay for environmental cleanup costs, the deposit will be used.

It is believed the federal government wants Diavik to put up at least $185 million.

That amount is well above what was required by BHP Diamonds, majority owner of the operating Ekati diamond mine, for its security deposit in the fall of 1996. BHP agreed to a deposit which, over time, will be worth $52 million.

On the Diavik deposit, Jim Moore, Northern Affairs assistant deputy minister, would only say: "That was an area being discussed by the company.

"We've got to arrive at an amount that all parties are comfortable with."

Before Diavik is to get its land-use permit, DIAND has said it must first complete the environmental agreement.

To begin construction at its Lac de Gras site later this year, Diavik needs the land-use permit to prepare the site for fuel and equipment which will be trucked up the ice road.

Miss the ice road and the project will be delayed a year.

With a land-use permit, Diavik can begin site preparation, Moore said.

The permit could conceivably be issued the same day the environmental agreement is completed.

Ted Blondin, spokesperson for the aboriginal caucus, said there is immense pressure to conclude the environmental agreement.

"To relieve the tension, the aboriginal caucus said they will sign all the agreements as a package."

Aboriginal groups are not holding up the process -- "We want it done right," he adds.

Blondin, who serves on the Dogrib environmental team, said as for the land-use permit, it is the aboriginal group's position that it is an issue between Diavik and the federal government.