Ekati Jay pipe construction delayed
Dominion says schedule assumes all-season road to site to take place next year
Shane Magee
Northern News Services
Wednesday, June 1, 2016
SOMBA K'E/YELLOWKNIFE
Dominion Diamond Corporation has announced construction of the Jay kimberlite pipe will be pushed to next year, a change from its original plans for the mine expansion expected to extend production at Ekati by a decade.
In a news release Tuesday, Dominion stated changes at Ekati mean extraction of diamond-containing ore can continue without needing construction of Jay to start this year. Major construction would instead start next year at the facility that has a total workforce of about 1,500. Some work is still expected to begin this year, including the assembly of a new crusher and associated support equipment, according to Dominion spokesperson Kelley Stamm.
"The changes we have made to the Ekati mine plan will allow us to maintain continuous feed to the Ekati processing plant, even with an extended timeline for commencing construction," stated Dominion CEO Brendan Bell.
Tom Hoefer, executive director of the NWT and Nunavut Chamber of Mines said the changes give the company more breathing room for the US $690 million capital project.
"To try and keep everything running at capacity and build a project at the same time, it was getting tight," Hoefer said.
The announcement comes just less than two weeks after the territorial government signed off on an environmental review of Jay, a step needed before construction could begin.
"The extra time will allow us to further advance Jay project permitting and to make aggressive efforts to reduce costs at the Ekati Mine," Bell stated.
The news release did not elaborate on what costs would be aggressively reduced.
No one from the GNWT was immediately able to comment.
Jay is considered the most significant undeveloped diamond deposit at the Ekati mine and is located under Lac du Sauvage about 1.2 kilometres from the shoreline of the lake, according to Dominion. It is about 30 kilometres from the main Ekati site.
Changes at Ekati, the company stated in the release, include the availability of Sable ore, deepening of the Koala underground and the continued successful trial of a lower throughput in the processing plant as a tool to increase recovery.
Delaying the use of the Misery Pit as a water management facility would allow the company more time for mining below the planned open pit.
The company is completing a feasibility study of Jay based on the new timeline, a study it expects to release soon.
The new schedule assumes construction of an all-season road seven kilometres from an existing road to the shoreline of Lac du Sauvage in 2017.
Dominion stated that once the all-season road is built, it would be followed by construction at the mine in 2018-20. Processing of ore would begin by late 2022.
Dominion's stock was up 2.99 per cent Tuesday, ending the day at $13.76 on the Toronto Stock Exchange. The stock has dropped from a five-year high of $24.02 on May 1 last year. Ekati, about 300 kilometres northeast of Yellowknife, began production in 1998 as the territory's first diamond mine and was expected to close in 2020 without the opening of the Jay pipe.
