De Beers gets OK for its first Canada diamond mine
VANCOUVER, British Columbia , June 1 (Reuters) - Diamond
giant De Beers said on Tuesday it had crossed the last
regulatory hurdle in its quest to build its first diamond mine
in Canada.
The world's No. 1 diamond producer has received a water
license from the Canadian government, the last permit it needed
to start construction work at its Snap Lake project, which is
located just south of the treeline in the remote Northwest
Territories.
"Snap Lake is De Beers' first project in Canada to receive
permits to proceed, and our team is eager to begin work on
site," said Richard Molyneux, president and chief executive of
De Beers Canada Corp., which has explored the country for
diamonds for 30 nearly years with little success.
"The successful conclusion of this process will send a
reassuring message to the De Beers board who have been watching
the process in Canada very closely."
Despite its virtual control of the world diamond industry
for most of the 20th century, De Beers was pipped to the post
by its competitors in Canada, the world's newest and
fastest-growing diamond producer.
Some analysts regard the absence of a mine in Canada as a
serious gap in De Beers' source of supply. In five years,
Canada has leapfrogged its way from a nonproducer of diamonds
to the world's third-largest by value.
In the next few weeks, De Beers will start underground
development work at the site, part of which is under a lake.
Actual construction of the C$490 million ($358 million) mine
should start next year with the first production planned for
late 2007.
The mine, which is 220 km (140 miles) northeast of the
territory capital, Yellowknife, is forecast to run for 20
years, producing the high-quality diamonds that Canada has
become known for.
The miner, which is 45 percent owned by Anglo American Plc.
<AAL.L> <AGLJ.J>, is still negotiating agreements with four
Aboriginal groups, who will be impacted by the mine.
The sparsely-populated Northwest Territories is home to
Canada's two other diamond mines and De Beers' rival
producers.
Anglo-Australian BHP Billiton's BHP.AX> <BLT.L> Ekati mine
opened in 1998 followed by Rio Tinto Plc <RIO.L> and Aber
Diamond Corp.'s <ABZ.TO> Diavik mine in 2002.
($1=$1.37 Canadian)
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Jun-01-2004 18:26 GMT
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