2 N.W.T. diamond mines face delays on expansion projects

The expansion of one N.W.T. diamond mine has been delayed, while the owner of another diamond mine says its own expansion project is at risk of running behind schedule.

On Wednesday, Dominion Diamond Corporation announced it is not planning to begin construction of the new Jay pipe at its Ekati mine until 2018, a year later than previously planned.

The company said in a news release that it still needs time to receive the permits needed to begin construction, and that existing reserves at Ekati are enough to prevent the cessation in mining that Jay was originally intended to prevent.

The company has yet to make an official decision to finance the Jay expansion — arguably the most important step to construction. But the decision in late May by the N.W.T. government to sign off on the project's environmental assessment represented is a key precursor to that decision.

A delay at Diavik?

Meanwhile, an ongoing dispute between the owner of the Diavik diamond mine and the land and water board for the Tlicho region has resulted in a gloomy forecast from the company.

Rio Tinto has asked that the rules for water quality in Lac de Gras be relaxed as the company builds a dike to contain a new pit, called A21, inside the lake. In response, the land and water board has proposed even stricter water quality rules than the ones that were in place when Diavik's first two dikes were built inside the lake years ago.

An N.W.T. government inspector has already threatened to shut down the dike construction project after the level of total suspended solids inside the lake went above the allowed limit during the first season of construction on the dike last summer.

Rio Tinto said the new rules are "likely to cause significant and unnecessary delays and stoppages in the work required to build the A21 dike this summer during the ice-free period, with the very real possibility that work scheduled to be completed in 2016 be deferred to 2017," in a letter written last week to the N.W.T.'s Environment Minister Wally Schumann.

The company is asking Schumann for another chance to be heard on the issue, after the land and water board already proposed the new rules to the minister.

Construction delay would be costly

Tom Hoefer, executive director of the N.W.T. and Nunavut Chamber of Mines, says Rio Tinto feels blindsided because one of the new, stricter rules wasn't advocated for by anybody during hearings leading to the land and water board's decision.

"Diavik is the inventor of dikes. They received Canada's top engineering award for that," he said.

"They know the recipe, and they were proposing the recipe for the first two dikes on the third dike, and now the regulator's decided that they have a whole new take on how that should be done.

"I hope somebody comes in with a sober second thought."

Hoefer added that a decision to call off construction this summer could be logistically messy and costly for Rio Tinto.

"You have to book equipment way ahead and specialist contractors as well. And if you have to then ask them to stand down, there's going to be cost to that."