N.W.T.'s Snap Lake diamond mine halts operation, De Beers says

De Beers Canada's CEO Kim Truter says its Snap Lake mine has been a 'troubled operation' since it opened, and that's why it is closing. About 434 De Beers employees will be laid off.

More than 400 workers facing layoffs, 100 of them are Northerners

De Beers CEO on Snap Lake mine closure

7 years ago
Duration 15:17
De Beers CEO on Snap Lake mine closure

De Beers Canada says its Snap Lake mine has been a "troubled operation" since it opened, and that's why it is closing.

The company's CEO, Kim Truter, spoke to reporters this afternoon, just hours after personally telling employees at the diamond mine that they're out of work.

De Beers announced this morning that it is laying off 434 employees and closing the Snap Lake mine, located about 220 kilometres northeast of Yellowknife. Mining will cease immediately and the site will be put under care and maintenance.

Truter said the company had tried a variety of solutions to keep the mine open, but ultimately had "no choice but to close the operation," calling it a "very, very difficult decision."

The closure comes amid a downturn in diamond prices and a costly water problem that required a licence amendment at the mine.

Snap Lake is N.W.T.'s only fully underground diamond mine, adding to its operation costs.

The Snap Lake diamond mine in the N.W.T. will close immediately, De Beers Canada says. The mine, about 220 kilometres northeast of Yellowknife, employed about 700 people. (De Beers Group)

"The market collapse has happened so fast, it's made the operation unviable for many years to come," Truter said.

Northerners given preference

Closing the mine will require 190 employees, while the care and maintenance phase will require approximately 70 employees.

Truter said, of the approximately 500 people affected, about 100 are contractors, and 400 are permanent employees. Of those permanent employees, 100 are Northerners.

De Beers Canada CEO Kim Truter says he was 'humbled' by how positively employees took news of the layoffs Friday morning. (Randall McKenzie/CBC)
About 100 workers will be transferred to De Beers' Gahcho Kue project, a diamond mine near the N.W.T.'s Kennady Lake, slated to open in 2016. Truter said the company is trying to give Northerners and aboriginal workers preference in hiring "to protect Northern employment."

Truter also said he was "quite humbled" by how positively workers took the news of the closure this morning, saying the announcement was "not unexpected."

Employees are entitled to full salary and benefits for 16 weeks. After that, Truter said they'll be officially terminated and receive compensation in line with local legislation.

"That was very, very well received," Truter said, adding that workers saw the compensation as generous.

Some mine workers were already on flights back to their communities this afternoon, Truter said, with some staying on for the care and maintenance phase.

De Beers said it will keep an eye on market conditions over the next year to determine the viability of the mine, but Truter said it's unlikely it will come back given the markets.

The Snap Lake mine opened in 2008 and employed about 700 people. It was Canada's only fully underground diamond mine, and De Beers's first outside of Africa. 

Speaking to CBC News Thursday, N.W.T. and Nunavut Chamber of Mines executive director Tom Hoefer said that a closure at Snap Lake would "rock our economy."

'Devastating this close to Christmas'

Vita Morin-Beaulieu is a housekeeper at Snap Lake, employed by a subsidiary of the Det'on Cho Corporation, which provides catering and camp services at the mine site.

She's expecting her layoff notice this afternoon.

"I feel like it's very, very difficult for families, especially those that have young children," Morin-Beaulieu said.

"Economically, it's devastating this close to Christmas."

She said she enjoyed her job at Snap Lake, working on a two-week rotation.

"You live there 50 per cent of the time, so it's home. That's your family when you're not at home."

Morin-Beaulieu said she'll be applying at the N.W.T.'s Diavik diamond mine, but she said it won't be easy landing another job.

"There are now going to be 400 of us looking for employment," she said.


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