The company that owns Ekati Diamond Mine has sought creditor protection due to a significant decline in diamond prices, dropping over 70% in a year. This move, reported by Cabin Radio, has raised concerns about job security and financial commitments to Indigenous communities. Arctic Canadian Diamond Company, the operator of the mine in the Northwest Territories, filed legal documents in British Columbia’s Supreme Court last week, securing protection until May 11 to prevent creditor actions.
Since its establishment in 1998, Ekati’s workforce has dwindled from 700 employees in 2024 to around 340 by March 31, with a notable percentage being Indigenous and northern residents. The company, which celebrated unearthing 100 million carats of diamonds last year, received a $175 million loan from the federal government to sustain operations and safeguard jobs.
Government officials, including N.W.T Industry Minister Caitlin Cleveland and Yellowknife Centre MLA Robert Hawkins, have expressed vigilance over the situation, emphasizing support for affected workers and communities. Union of Northern Workers president Gayla Thunstrom highlighted the stress faced by union members and criticized the recurrent disruptions caused by changing ownership.
Court documents reveal Arctic Canadian Diamond Company’s financial distress, with liabilities totaling approximately $655 million, primarily attributed to Ekati. The company faces challenges in meeting essential financial obligations, endangering its continuity. Factors such as declining diamond prices, competition from lab-grown alternatives, reduced demand from China, and trade-related impacts have contributed to the predicament.
Despite generating over $600 million in diamond sales in 2024, the company faced a drastic decline to around $253 million in sales the following year. The pressing financial situation underscores the uncertainties surrounding Ekati Diamond Mine’s future and the wider implications for stakeholders and local communities.