Ekati Diamond Shock Closure Sparks Mass Layoffs in Canada

Canada Jewelry News: Sudden Blow to Canadian Diamond Industry

In a major disruption to Canada’s gemstone mining landscape, Burgundy Diamond Mines has announced a full halt to open pit operations at Point Lake, part of the Ekati diamond mine in the Northwest Territories. The move, driven by what the company describes as “continuing challenging market conditions,” has resulted in hundreds of layoffs, shaking the regional economy and the global diamond trade.

Title: Eakati diamond mines in Canada come to a halt
Image Credit: Burgundy Diamond Mines

Market Collapse Hits Hard

This Canada Jewelry News report reveals that the ongoing collapse in rough diamond prices has rendered operations at Point Lake financially unsustainable. Burgundy stated that the current market downturn has made the open pit mine “sub-economic.” While activities at Point Lake have stopped, the company emphasized that maintenance operations will continue to allow a rapid restart if market conditions recover.

Underground Operations Continue

Despite the shutdown, Burgundy is continuing its mining operations at the Misery underground site nearby. The company noted that productivity at Misery has shown marked improvement in recent months, offering a small ray of hope amid the widespread job losses.

Leadership Turmoil and Financial Woes

Adding to the turbulence, Burgundy’s CEO Kim Truter stepped down earlier this year, replaced temporarily by board member Jeremy King. The company, which acquired Ekati in 2023 for $136 million, reported a staggering $97.3 million loss for fiscal year 2024. Before announcing the closure, Burgundy also paused trading of its shares on the Australian Securities Exchange, signaling deeper internal instability.

The fallout from the Ekati shutdown is likely to ripple across the global diamond supply chain and puts further pressure on already volatile markets. Whether Point Lake will ever return to full-scale production now hinges entirely on a diamond market rebound that seems increasingly elusive. For the latest Canada Jewelry News, keep on logging to Gems News.