DDMI is still awaiting an Alberta court decision which would allow them to sell off Dominion’s shares in the Diavik diamond mine.
Dominion is also trying to avoid moving into liquidity – selling off assets so the company has more cash flow – which would allow it to keep Ekati mine operational.
Dominion has also applied to extend its creditor protection – a pause button on paying back its debts – until December 15, with the case yet to return a decision.
Diavik
A hearing was held in an Alberta Court on October 30, but there was no decision released on whether DDMI, a subsidiary of Rio Tinto who co-owns the mine with Dominion, would be allowed to sell Dominion’s shares in Diavik to recoup unpaid debts.
A decision is still yet to be released.
Dominion owes DDMI more than $120 million in payments for operation fees.
Dominion has been unable to pay those fees since they filed for creditor protection — essentially a pause button on debt payments so the company can restructure its finances — back in April.
DDMI moved forward with an appeal to sell off Dominion’s share as there is “no realistic chance” Dominion will be able to pay its debts to DDMI, according to an affidavit signed by Thomas Croese, the finance manager of the Diavik mine.
If DDMI is allowed to sell Dominion’s shares in the Diavik mine, it would allow them to recoup the money Dominion owes them.
Ekati
Brendan Bell, a company director with Dominion, said liquidity was now “a real possibility.”
Bell made the comments in a court affidavit as Dominion seeks to extend its creditor protection until at least December 15.
The Ekati diamond mine was forced to suspend operations back in March due to COVID-19, and have furloughed or laid off most of the employees who worked there.
A petition was started calling for the Ekati mine to be kept open. It had gathered 915 signatures by the time of writing.
“The Ekati Diamond Mine is a huge part of why mining is the largest contributor to the NWT economy,” the petition reads. “Its closure this year has created significant hardship for employees, businesses, and governments.
Outlook
The diamond mining industry in the Northwest Territories has been hurting throughout the COVID-19 pandemic.
In a presentation of the update to its 2020 budget, Finance Minister Caroline Wawzonek said the slowdown in the diamond market has been “quite significant.”
Wawzonek added a drop in demand for diamonds is impacting territorial revenues. The GNWT lost around $30 million as a result of the slowdown in sales from the diamond mines shrinking the royalties the territory received.
In the Legislative Assembly on Tuesday, Rocky Simpson, MLA for Hay River South, called on the GNWT to do “all it can to support” the mining industry, which “gives residents hope” of bettering their lives.
“With the variety and abundance of non-renewable resources present in the NWT, we continue to be a have-not territory,” said Simpson.
“We as a government must promote and support the exploration and development of our non-renewable resource sector through clear and reasonable legislation and with timely decisions so projects can advance.”
