The Ekati Diamond Mine in the Northwest Territories is preparing to cease operations earlier than expected after its owner, Burgundy Diamond Mines Ltd., was unable to secure a buyer for its Canadian subsidiary and exhausted the funds needed to continue operating.
Located approximately 300 kilometres northeast of Yellowknife, Ekati has been one of the territory’s economic pillars for more than two decades. Its closure follows the planned shutdown of Rio Tinto’s Diavik mine in March after the site reached the end of its operational life.
With Ekati closing, Gahcho Kué, jointly owned by De Beers and Mountain Province, will become the Northwest Territories’ only remaining diamond mine. However, that operation is also expected to wind down in the coming years.
Together, the territory’s three diamond mines have been estimated to contribute around 20% of the Northwest Territories’ gross domestic product, while providing significant employment opportunities for Indigenous communities and supporting numerous local businesses.
The closure process accelerated after the Supreme Court of British Columbia placed Burgundy’s Canadian subsidiary, Arctic Canadian Diamond Company Ltd., into receivership.
Receivership is a court-supervised process in which an independent third party takes control of a financially distressed company to protect assets, satisfy creditors and oversee remaining obligations.
The company had received creditor protection in May in an effort to identify a path forward for continued operations. According to Robert Jenkins, Deputy Minister in the Northwest Territories’ environment ministry, those efforts ultimately failed to produce a viable solution.
As a result, the company no longer had the financial resources required to continue operating the mine.
Representatives from the court-appointed receiver, PricewaterhouseCoopers (PwC), are now overseeing activities at the site to ensure worker safety and environmental protection while managing an orderly shutdown.
Approximately 360 employees worked at the Ekati mine before the closure process began.
Jenkins said a reduced workforce is expected to remain on site to support ongoing care, maintenance, environmental monitoring, reclamation and eventual closure activities under PwC’s supervision. However, the exact number of positions that will be retained has not yet been determined.
Court documents also authorize the receiver to implement workforce reductions, including layoffs or employment terminations where necessary.
Burgundy Diamond Mines Chief Executive Officer Jeremy King described the closure as a deeply disappointing outcome for employees, stakeholders and communities throughout the Northwest Territories.
In a statement released through the Australian Securities Exchange, King highlighted Ekati’s contribution over more than 25 years, noting its role as a major private-sector employer and its longstanding partnerships with Indigenous communities and regional businesses.
The Northwest Territories government currently holds approximately $327 million in financial security intended to cover the long-term maintenance, reclamation and closure of the mine.
While Jenkins expressed confidence that the existing funds provide a strong foundation, he acknowledged that the premature closure means environmental and technical experts, together with PwC, will review whether reclamation costs need to be updated.
The territory currently has an interim mine closure plan dating from December 2022, but a final closure strategy had not yet been completed. Prior to its financial difficulties, Burgundy had projected that Ekati could continue operating until 2040.
Jenkins said the interim plan provides valuable guidance for the closure process but acknowledged that the absence of a finalized long-term plan presents challenges and highlights the need for stronger planning frameworks for future mining projects.
The decline of Canada’s northern diamond industry has been driven by several factors, including increasing competition from lab-grown diamonds and the impact of U.S. tariffs that have put pressure on an already tough market.
As the territory readies itself for a post-diamond economy, government leaders are increasingly looking to critical minerals as the next big economic driver Future growth is predicted to come from a greater number of smaller mining projects, supported by investments in transportation, energy infrastructure and new developments that have already been referred to the federal government’s major projects office for accelerated approval.
The closure of Ekati means the end of another chapter in one of Canada’s most important mining regions, but also highlights the need to diversify the Northwest Territories’ economy for decades to come
