De Beers Canada to file plans to flood Snap Lake diamond mine

The company says it will file an extended care and maintenance plan, which will include flooding the mine's underground tunnels. One analyst says that doesn't mean the mine will stay closed for good.

'In a lot of cases flooding won’t impact the mine,' says Tom Ormsby of De Beers Canada

The Snap Lake diamond mine, about 220 kilometres northeast of Yellowknife, employed about 700 people before it ceased operations in December. (De Beers Group)

De Beers Canada may flood the underground workings of its shuttered Snap Lake diamond mine 220 kilometres northeast of Yellowknife.

The company, which is currently suspending operations at the unprofitable mine as a step towards placing the site on care and maintenance, said it will file an extended care and maintenance plan, which will include flooding the mine's underground tunnels (which come with inherent and costly water problems).

"Companies look at partial or full flooding from an economic point-of-view, as pumping water is expensive," said Tom Ormsby, head of corporate affairs for De Beers Canada.

"Companies review costs as well as the technical specs on whether or not flooding will compromise the integrity of the mine. In a lot of cases flooding won't impact the mine, so it is a fairly common practice for mines on care and maintenance."

Flooding the mine shouldn't be read as a bad sign, said Paul Zimnisky, a diamond industry analyst.

"I don't think it's an indication of permanent closure at this time," he said.

De Beers said the length of the care and maintenance may be three years or more, dependent on market conditions, "but will be reviewed in late 2016."

Flooding also brings environmental benefits, said Zimnisky.

"By ceasing the pumping, the risk of returning contaminated water back to the lake is reduced."