Diamond find in 'big rabbit country'

De Beers, the world's largest diamond company, is rapidly making itself at home in snow-bound Canada, thousands of miles from its base in South Africa. On the heels of its Snap Lake mine in Northwest Territories and the Victor mine in northern Ontario, De Beers filed permit applications in late November for the Gahcho Kué mine, also in Northwest Territories. The latest large-scale project will be a partnership with Mountain Province Diamonds (44.1 percent) and Camphor Ventures (4.9 percent).

Construction at the Snap Lake site began this year and is due to be completed in fall 2007. Construction of the Victor project is scheduled to begin in 2006. Gahcho Kué boasts the highest average grade and the highest estimated production rate of the three mines: 1.64 carats per metric ton and 3 million carats to be produced annually over 15 years of operations. Snap Lake has a grade of 1.46 carats per ton with a production rate of 1.5 million carats per year, while Victor has a grade of 0.23 carats per ton and 0.6 million carats per year are expected to be mined there.

Gahcho Kué applications filed

The permit applications for Gahcho Kué have been filed with the Mackenzie Valley Land and Water Board, which brings federal, territory, community and aboriginal governments into the process of assessing the mine's potential impacts.

De Beers Canada has already been working closely with several aboriginal groups that are impacted by the Snap Lake project - the Yellowknives Dene First Nation, the Lutsel K'e Dene First Nation, the Tlicho Nation and the North Slave Metis Alliance - and is negotiating impact benefit agreements with them.

The agreements include employment, training and development and business opportunities as well as scholarships and financial compensation for loss of subsistence land-use while mining operations are in progress, according to De Beers.

The first major discovery at Gahcho Kué, which is located 187 miles northeast of Yellowknife and just 56 miles east of Snap Lake, came in 1995 when Mountain Province Mining found what is known as the 5034 kimberlite. Mountain Province and De Beers formed a joint venture partnership in 1997, and De Beers subsequently discovered seven more kimberlites on the property. Gahcho Kué was formerly known as Kennady Lake. The new name of the property is the traditional Chipewyan name for the area, meaning a place where there are big rabbits or hares.

Three kimberlite deposits

The three kimberlite deposits that make the mine economic are 5034, Hearne and Tuzo. These three and an additional pipe are located under Kennady Lake, and are covered in sand, gravel and lake bottom sediments. To reach and mine the pipes, the water level of Kennady Lake will need to be lowered temporarily. Natural hills on the lake bottom and constructed dyke impoundments will be used to separate Kennady Lake into two basins. The eastern part of the lake will remain the same, while the western two-thirds will be lowered as required to allow for mine development.

A water treatment plant will be capable of treating up to 60,000 cubic meters of water daily. As Kennady Lake is lowered, it will treat the water before it is released into streams and other water systems. It will also be used to treat some water that accumulates in the pits. Runoff collection ditches and ponds will be constructed both on land and within the drawn down lakebed areas to control runoff from developed areas. A system of pipelines and pumps will be installed to direct water collected in these ditches and ponds.

Capital costs C$825 million

Capital costs to construct the open pit mine at Gahcho Kué are estimated at C$825 million, with annual operating costs of C$135 million. It will employ up to 600 people during the peak of its three-year construction period and 400 people during the operations phase of the mine. Like other diamond mines in the region, the site is remote and can only be accessed by air, except in February and March, when a 74-mile winter spur road off the main winter road between Yellowknife and Lac de Gras can be used.

Diamonds at Gahcho Kué will be liberated by crushing the kimberlite, and fine material will be removed by washing and screening. The crushed, washed and screened product will then be processed through a dense media separation circuit, in which cyclones will be used to produce a concentrate of diamonds and other heavy materials. The dense media separation concentrate will then be passed through X-ray and laser sorters to recover the diamonds.

The close proximity of the kimberlite deposits on the site enables De Beers to sequentially mine the pits, using waste rock from the mining process to back fill pits mined earlier. This should reduce the amount of time it will take for the land to return as closely as possible to its original state and for the lake to reestablish itself. The Gahcho Kué project is governed by an ISO 14001 Environmental Management System.