John Curran
Northern News Services

Yellowknife (July 01/05) - De Beers Canada will soon start seeking permits for what could become the NWT's fourth diamond mine by 2011.

The company owns 51 per cent of the Gahcho Kue property, located roughly 300 km east of Yellowknife and 100 km from Snap Lake. Two other companies also have shares in the project, 44.1 per cent is held by Mountain Province Diamonds and 4.9 per cent by Camphor Ventures.

The news came after Roscoe Postle Associates completed a review of De Beers' $25 million pre-feasibility study.

"The results are encouraging," said Linda Dorrington of De Beers Canada. "Based on that, we are putting together a proposal on how to move forward."

De Beers estimates a mine at Gahcho Kue, formerly referred to as Kennady Lake, would cost about $608 million to build and would employ 300 people.

Although it expects to revise its estimates in the coming months, in a 2003 conceptual study De Beers said it expects to mine 20 million tonnes of kimberlite from the Hearne, 5034 and Tuzo bodies during a 15-year mine life.

Annual production estimates are as high as four million carats with revenues of $245 million.

The property has already yielded one of the most valuable gems ever collected in bulk sampling from anywhere in the world, said Jan Vandersande, president and chief executive officer of Mountain Province Diamonds.

Top quality

"We found a 9.9 carat diamond in 2001 that was top quality and top colour," he said. "At the time it was valued at $60,000 so today it would be worth about $80,000, if not more."

De Beers' $636 million Snap Lake mine is now under construction and is expected to open in 2007.

Vandersande said he hopes Gahcho Kue will be able to get through the regulatory process in two to three years.