Upcoming B2B Gems & Jewellery Exhibition- 19th - 20th - 21st January 2019. Bangalore.

Ekati Diamond Mine review of the repairs required!

2016-08-07


Dominion Diamond further review of the repairs required at the Ekati Diamond Mine process plant from the fire that occurred on June 23rd, it continues to estimate that repairs will take approximately three months from the date of the fire, and is currently estimating the cost of repairs to be approximately CDN $25 million. This cost estimate is very preliminary however, and may change as the repair activities progress.

Repairs will include the replacement of degritting screen #3 with the associated rubber lined chutes, piping, pumps and motors, as well as electrical cables and instrumentation. Most of these items are already on hand while some others are currently being procured, and will be flown to site. The Company has an insurance policy on the Ekati diamond mine that includes a property damage and business interruption component and it has commenced work with its insurance claims adjusters.

The Company is reducing operating costs and deferring some capital costs during the plant downtime. Mining activities continue at the higher value Misery open pit and Koala underground, and have been suspended at Pigeon and Lynx. The Misery and Koala material will be stockpiled, with the intention of processing a blend of the high value Misery Main and Koala ore when the process plant restarts.

Updated production guidance for the Ekati Diamond Mine for fiscal 2017.Non-essential sustaining capital projects including mobile equipment rebuilds and the expansion of communication and automation systems have been postponed until fiscal 2018. A temporary layoff of approximately three months has already been implemented with an estimated impact on approximately 330 temporary and permanent contractors, and employees.

Brendan Bell, Chief Executive Officer, stated: “We continue to actively manage this situation, and have implemented a prudent strategy to minimize the impact of this incident on our cash flow. We’ve planned mining activities to allow for the option to prioritize higher value ore sources on start-up, thereby minimizing the impact on the value of our fiscal year production.”