The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Within 1% of diamond guidance despite 22-day shutdown North of 60 Mining News – January 14, 2022
Mountain Province received C$298.4 million from the sale of 3.15 million carats of Gahcho Kué diamonds during 2021.
Mountain Province Diamonds Inc. Jan. 13 reported that the Gahcho Kué Mine in Canada's Northwest Territories produced 6.23 million carats of diamonds during 2021, just below the guidance of 6.3 million to 6.5 million carats set out for the operation at the beginning of the year.
This near-guidance production is despite an unplanned 22-day shutdown of the mine in February due to COVID-19.
Owned under a joint venture between Mountain Province (49%) and De Beers Canada Inc (51%), Gahcho Kué is the newest of the three large diamond mines in Northwest Territories. Having reached commercial production in 2017, this operation has spent 40% of its operational life navigating a global pandemic that has impacted the diamond sector harder than the larger mining industry.
Against this backdrop, Gahcho Kué has been able to keep production costs down.
According to preliminary calculations, the mining and processing costs at Gahcho Kué were C$123 per metric ton, which is below the C$125 to C$135 per metric ton 2021 guidance. The per-carat cost to produce diamonds costs at the operation last year was C$61, which is within the C$58 to $63 per carat guidance.
"2021 was an excellent year for the Gahcho Kué operations. Managing through the COVID-19 pandemic to finish 1% below production guidance is testament to the management of the operations. At the same time to finish with a preliminary cost per tonne about 2% below the bottom end of the cost range is an excellent result," said Mountain Province Diamonds President and CEO Mark Wall.
Recovering diamond markets are also helping the company.
During 2021, Mountain Province sold 3.15 million carats from its share of Gahcho Kué production for an average of C$94 per carat for total proceeds of C$298.4 million. This compares to 3.33 million carats sold at an average of C$68 per carat for total proceeds of $227 million during 2022.
The company says strong diamond jewelry sales during the holidays and lower rough diamond supply from the major producers are expected to maintain this positive momentum through to its upcoming January sale.
"We end the year with production very close to guidance, lower costs and increased revenue based on a rising demand and strengthening diamond prices, which is a great platform to commence 2022," said Wall.
With confirmed cases of COVID-19 at Gahcho Kué in December, the mine owners must remain vigilant to ensure that illness does not slow production during 2022.
Mountain Province says mine management continues to manage the COVID-19 impacts to operations through a 100% vaccinated workforce and testing protocols.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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