100 jobs affected as Dominion Diamond relocates head office from Yellowknife to Calgary
Diamond company says the move is cost saving measure — expected to be finished by mid-2017
Dominion Diamond Corporation's decision to move its headquarters from Yellowknife to Calgary represents a "big blow" to the city and territory, says the president of the N.W.T. Chamber of Commerce.
The company announced the planned move in a press release Monday, saying it "will impact approximately 100 employees based in the Northwest Territories."
It's not clear exactly what "impact" means, or how many of those 100 affected employees have received layoff notices.
A company spokesperson says "discussions are ongoing with staff to determine those details. Positions that will not be relocated as a result of the move will be provided a severance package."
"Certain key positions" will be maintained at a reduced Yellowknife office, the press release states, adding that "most of the Company's workforce, including the majority of its northern Aboriginal employees, will continue to be employed in the Northwest Territories."
The move is expected to be complete by the middle of 2017, after which the company expects to save approximately $19 million annually.
Ripple effects
For Richard Morland of the Chamber of Commerce, the move will create a ripple effect.
"Possibly a few hundred less people living in the community," he said. "That means less money being spent around the various businesses around the community. There will be an impact on the housing market. There will be an impact to the community level, to schools and other organisations that many of these people are part of so this is a big deal."
Morland, who is also a former chief operating officer for Ekati when it was owned by BHP Billiton, says the move "flies in the face in the values that Bob Gannicott stood for about a Canadian northern diamond business," referring to the founder of Dominion Diamond Corporation.
"Bob put a lot of emphasis on the fact that his senior leadership was resident in the community. Those community ties are vital."
He also said the move would hurt the image of the N.W.T.'s already struggling resource sector.
"I think the loss of senior leaders from the premiere diamond business in the North is a big blow."
Time to look forward, says Yellowknife mayor
Yellowknife Mayor Mark Heyck said he met with the CEO of Dominion Diamond Monday afternoon.
In an interview, he said he was aware of the company's financial challenges, but also that Yellowknife is resilient, having weathered similar situations in the past.
"I do think it reinforces the really important need for our community to take a look at the years and decades ahead in terms of what our local economy is going to look like 20 or 30 years from now, when we may not have diamonds in the Northwest Territories anymore."
Heyck said it's up to elected officials and public leaders to consider the city's future.
He's hopeful the Dominion Diamond job losses will be cushioned by new jobs in the construction of the new hospital and the remediation at Giant Mine.
'Not an easy decision'
"Although this was not an easy decision, it is necessary to support the long-term strength and viability of our operations," Dominion Diamond CEO Brendan Bell is quoted as saying in the press release.
"The Ekati mine is a pillar of the N.W.T. economy, and this cost reduction effort will allow us to continue to provide northern employment opportunities and benefits well into the future," he added.
Over the past year, the company has had to deal with low global diamond prices, as well as a number of shocks, including the death of company founder Robert Gannicott and a fire at Ekati Mine which shut down the processing plant for three months and cost the company around $20 million to repair.
with files from Kate Kyle and Mitch Wiles