ATTAWAPISKAT - De Beers Canada announced Wednesday that the Victor diamond mine, the first and only commercial diamond mining operation in Ontario, is shutting down in less than a year and a half.
Kim Truter, the company’s chief executive officer made the announcement in Timmins, which for the past 10 years has been the main jumping-off point for access to the mine, located in the James Bay lowlands, roughly 100 kilometres west of the First Nation community of Attawapiskat.
The mine can only be accessed by air year round, or by a winter road, for five or six weeks in January and February.
Truter said the mine has performed according to the original mine plan and now that the diamonds within the Victor property are gradually being depleted, the time is right for closing.
“The mine was forecast to produce 6 million carats during its life and it has already exceeded those projections producing approximately 7 million carats to date,” said Truter.
“It will continue to operate at full production throughout its remaining life.”
The eventual shutdown is expected to occur in the first few months of 2019.
When the mine first went into operation in 2008, there was speculation that more diamonds could be found within other kimberlite deposits, which is the name for the host rock formation for diamonds.
Truter said over the years it was determined that other kimberlites did indeed show some opportunities but not enough to be sustainable. He said they needed the Victor pit to survive.
“At the onset of Victor’s operation more than 10 years ago, we knew there were other prospects on the Victor property. But even then we knew the scale of those other prospects were quite small.
“The more work we did on them the more we realized that they were not economically feasible. And so in end it was decided that it would be better to curtail operations once we depleted the open pit and move responsibly into closure.”
Truter said an important part of that decision was the need to give more of a sense of certainly to the 550 employees and contract workers who themselves were wondering about the life of the mine.
Truter also put to rest any speculation that the shutdown was the result of pressure, disputes or influence from the First Nations to prevent further mining exploration or activities.
“No, none whatsoever,” Truter said in response to a question from The Daily Press. “Our decision is really based on economics.”
He also said that De Beers has maintained a good relationship with the First Nations.
“We just actually met with the chiefs and we had a very positive conversation about making sure that we use the next 16 months wisely as we wind down operations and into the closure phase,” said Truter.
”And we’ve agreed that we’re going to work very, very closely with the community to ensure that we end things well and we enter the closure phase responsibly.”
Truter said there have been instances in other mining communities where closure plans did not end well. He said that would not be the case with the Victor shutdown.
“We are determined from a De Beers point of view to make sure that this closure is done responsibly and leaves a very positive legacy,” said Truter.
With respect to environmental concerns, Truter said work had already commenced with the planting of 200,000 tree saplings and willow stakes through a local work program employing young people from Attawapiskat.
One of the more obvious changes people will notice is the fact that De Beers will also be phasing out the winter road program, which sees the creation of an ice road into the mine site each year.
“As we wind down operations, we will start scaling that road down accordingly. Over the next three years, there won’t be too much change to the road.”
He added the road would be needed to haul materials out of the mine site until about 2020.
Despite the fact that a mine shutdown is inevitable and not considered a good news story, Truter said De Beers is trying hard to lessen the impact.
“So for example we have already awarded a reclamation contract to one of our community partners.”
Truter said Northec was the name of that company, which has an office located in Timmins.
He added that De Beers still has obligations under its several Impact Benefit Agreements (IBA) with First Nations in the North.
As part of that, Truter said the First Nations communities have a right of first refusal for any equipment or assets that De Beers intends to dispose of. He said this could include the accommodation units that are currently on site to house the company workers.
“One year before formal closure or operations ceasing, we have to provide each of the IBA communities with a full list of all the assets that are available. Following that procedure, he said, any remaining assets will likely go to auction.
“We will also look at things like donations to the communities or any other needs that might be out there,” he added.
“As soon as we cease operations in Q1 2019, full scale demolition activities will commence. Our ultimate goal for the property will be zero infrastructure and zero people,” he said.
He added there would be a “post closure” phase for several years beyond the actual shutdown, where people and equipment will be required to carry out environmental monitoring.
Typically, Truter said, this is a period of at least five years.
So what about exploration for new diamond mines? What are the chances of finding a new prospect?
Truter replied that De Beers has been doing active exploration in active in Canada for 50 years. He added that De Beers is the only diamond mining company that continues to explore throughout Canada and is quite active in Ontario.
“The short answer is that we’re still out there hunting and we remain hopeful,” he said.