Richard Gleeson
Northern News Services

Yellowknife (Oct 12/01) - Hard to believe, but it was only a decade ago that Dia Met Minerals Ltd. and BHP announced the discovery of diamonds at Lac de Gras.

Data gems - Number of known kimberlite pipes in the NWT: 300 - Number known to be diamond-bearing: 20 - Largest diamond recovered in NWT: 182 carats (Ekati) - Projected peak annual revenue at Diavik: $336 million; at Ekati: $550+ million - Number of "Northerners" employed at Ekati and Diavik: approx. 900 (Northerners are those with an NWT health card, which requires six months residency).

The announcement triggered the largest staking rush in Canadian mining history and marked the beginning of an economic boom that made the business generated during gold rushes look like chump change by comparison.

At peak production, the Ekati, Diavik and Winspear mines will unearth 12 per cent of the world's diamonds by value. The first is already producing, the second is under construction and the regulatory review for the third is underway.

Next to the transnational corporations that hold most of the shares in the mines, members of Yellowknife's business community have been the biggest beneficiaries of the boom.

NWT Chamber of Mines general manager Mike Vaydik says the rush of business to the city began with staking activity, which increased demand for everything from hotel rooms to camp cooks.

"(Exploration) expenditures peaked at around $200 million a year in 1995 and '96 and they've levelled off at about $155 million," Vaydik says. "That's a direct shot into the North's economy because that's stuff we can sell. We've got it and we know how to sell it."

Vaydik says the diamond exploration boom helped offset the downturn in gold exploration prompted by the Bre-X scandal of the 1990s and depressed gold prices in general.

In addition to rejuvenating old businesses, diamonds have given rise to new ones. Most directly connected to the mines are the sorting, cutting and polishing operations sprouting in the city over the last three years.

But a host of businesses has been created to service the mines.

Ron and Peggy Near, for example, started their security business in 1998 as a direct response to the growth of the diamond industry.

"Without it we probably wouldn't have opened our doors at all," says Ron Near. "In that time period we've gone from three employees to -- timesharing through the year -- over a hundred employees."

Eyeing the needs of the oil and gas industry, Near anticipates growth will continue at the same pace in coming years.

Vaydik says continued exploration, particularly in the already proven Lac De Gras area, makes it likely that the diamond industry will continue to benefit Yellowknife beyond the 20- to 25-year life of the current projects.