July 13, 2004
Tuesday

Juneau, Alaska - More than two dozen Alaskans visited the diamond mines of Canada's Northwest Territories in the first such tour organized by the Alaska Miners Association, prompting Governor Frank Murkowski to congratulate the organization for its work in furthering cross-border cooperation.

"Alaska and its neighbors in the Yukon Territory, the Northwest Territories and throughout Canada share a common goal of responsible development to meet worldwide demand for our resources," the governor said. "Whether drilling for oil and gas, hard-rock mining for gold, digging for base metals - or even mining diamonds - northerners have a lot of knowledge to share with each other, and visits such as this one are key to building a close, working relationship. Anytime we can get together and discuss mutual problems, ideas and successes, everyone benefits," he said.

Production from two large diamond mines, about 190 miles northeast of Yellowknife in the Northwest Territories, near the waters of Lac de Gras, has made Canada the third largest producer of diamonds in the world.

"The Diavik mine is the richest diamond deposit on a value-per-tonne basis on the planet, and the Ekati mine falls within the top five," said a June 2004 research report by Canaccord Capital Corp., a Vancouver, B.C.-based investment adviser firm. "By 2007, we forecast that Canada may challenge Russia for the second spot," the report said. "Our view is that this group of professionals is now world class."

The Diavik mine went online in 2003, producing 3.8 million carats in its first year, according to its owner, Diavik Diamond Mines Inc. Full production is estimated at twice that volume. The majority owner in the venture is worldwide mining giant Rio Tinto of London.

The Ekati mine started production in 1998 and employs more than 700 workers. Australian mining and energy company BHP Billiton Ltd. owns 80 percent of the venture, which is expected to produce up to 4.5 million carats a year.

"Diamond exploration right now is a huge, huge part of the exploration in North America," said Steve Borell, executive director of the Alaska Miners Association. In addition to production and further exploration in the Northwest Territories, companies are exploring for diamonds in Canada's Yukon and Nunavut territories and even a little bit in Alaska, Borell said. "The timing for this tour was right."

The three-day tour ran Tuesday through Thursday, July 6-8, and included 25 Alaskans and participants from the Yukon Territory, British Columbia, Colorado, Oregon and California. Alaskans included mining company, Native corporation, university and government officials.

The Alaska Miners Association organized similar tours of Canadian gold and base-metal mines in the early 1980s, and a Russian mine tour in 1993, Borell said.

In addition to touring the diamond mines, the group met in Whitehorse with Yukon Territory mining officials and in Yellowknife with Northwest Territories government officials.

The majority of diamonds are found in a volcanic rock called kimberlite. Eruptions carried the diamonds from where they were formed many miles deep in the earth to near the surface, through what are called kimberlite pipes, where they are mined by open-pit or underground methods.

"Diamond-bearing kimberlites are rare," the Canaccord Capital report explained. "More than 3,200 kimberlites have been found throughout the world, but only about 70 to 80 have contained commercial quantities of diamonds. Of these, we estimate 14 have been identified in Canada in the past decade in the Lac de Gras region alone. "We estimate the gross value of the Ekati, Diavik and Snap Lake reserves combined at roughly $25 billion to $30 billion (U.S.)," the report said. A third diamond project, Snap Lake, is expected to open in 2006/2007.

Source of News Release:

Office of the Governor
Web Site

 

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