Gahcho Kue diamond mine expected to provide boost to Canadian economy

September 8, 2016

The Gahcho Kue diamond mine in Canada’s Northwest Territories will open later this month. The mine is being called the as "the biggest and richest new diamond mine in the world," by its owner, DeBeers Canada.

CBC reported that the mine is expected to have a large impact on the Canadian economy and that its development has already pumped $440 million in the Northwest Territories economy and an additional $350 million into the rest of the Canadian economy.

"It's a big deal," said chief executive Kim Truter. "It's a big deal for the N.W.T., for Canada, for De Beers and for Anglo American."
Anglo American owns 85 per cent of De Beers.

So far, the territorial and federal governments have collected $20 million in revenue as a result of the mine, most of it from income tax paid by mine workers. Another $4 million has been paid to the six aboriginal groups that signed Impact Benefits Agreements for the mine.

The official opening of Gahcho Kue is scheduled to take place at the mine, located 300 km (186 miles) northeast of Yellowknife, on Sept. 20. But Truter says the mine came in under budget and ahead of schedule and moved into production last month.

A former president of Diavik Diamond Mines, Truter told CBC that his experience in the Northwest Territories was "absolutely invaluable" to his job of heading up Gahcho Kue.

"Unless you've lived locally and understand how things work locally, you really can't do this job properly... I spent five years living and working in the Northwest Territories, so I get the story."

De Beers predicts that during its 12-year life, the mine will provide a $6.7 billion boost to the Canadian economy.

De Beers owns 51 percent of Gahcho Kue. The remainder is owned by Mountain Province Diamonds.

Both Mountain Province and Anglo American are enjoying sunny days. Gahcho Kue's final run-up to production has taken place as slumping diamond prices have rebounded. Anglo American has seen its share price jump 280 per cent since December. Shares in Mountain Province Diamonds have climbed 90 percent.

De Beers says that 90 percent of the mine's benefits to the N.W.T. and Canada are yet to come. So are the profits.

According to figures published by the companies, they anticipate that Gahcho Kue will produce more than $10 billion worth of diamonds.

 

 

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