De Beers shuts Canada mine due to adverse market condition

Retrenches 60% employees; to review decision in 2016

De Beers, one of the world’s largest diamond miners, has shut its Snap Lake mine in Canada because of adverse market conditions. The company said the mine was closed for “care and maintenance”.

The mine opened in July 2008 and was Canada’s only fully underground diamond mine. The mine produced 1.2 million carats last year and has a life of around 40 years. Snap Lake was De Beers’ first diamond mine outside Africa.

“De Beers has placed its Snap Lake diamond mine on ‘care and maintenance’. The decision follows a review of the mine’s operation in light of current market conditions,” said Kim Truter, chief executive officer of De Beers Canada.

De Beers has retrenched 60 per cent of the mine workers. “We will evaluate market conditions over the next year to determine the potential of the ore body as a viable mine,” said Truter. Suspension of work is expected to last between one and nine months during which environmental monitoring and work required under the mine’s permits will continue.

“The men and women at Snap Lake have put enormous effort into his challenging ore body over many years, but even the gains made this year are not enough to overcome the market conditions and put us in a profitable position. To see such a strong commitment to the mine makes today’s announcement that much more difficult,” Truter clarified.

De Beers produces 32 million carats of rough diamonds a year. The slowdown in China and low demand in India have hurt global jewellery sales. India, which processes over 90 per cent of the world's rough diamonds, faced a 25 per cent decline in jewellery exports in October.