Ekati Owner Secures Funding to Keep Mine Afloat

Burgundy Diamond Mines has received a loan for up to CAD 115 million ($83.3 million) that will enable it to continue to run its Ekati mine during the prolonged market downturn.

The funding came through Canada Development Investment Corporation (CDEV), which offers a facility that provides financial support to large Canadian enterprises impacted by actual and potential tariffs and countermeasures, Burgundy said last week.

The miner intends to use the capital to continue development of its underground operations, reactivate its Sable open-pit operations, and complete the processing facilities at its Fox underground plant. It will also put the money toward general costs associated with running the company, it explained.  In return for the loan, Burgundy will provide the lender with shares in the company and has agreed to a restructuring.

Burgundy will also close its Antwerp sales office, it disclosed. The shutdown will provide the miner with “significant cost savings,” and “allow it to leverage high-quality outsourced auction and tender services.”

“This loan is critical to assisting Burgundy and Ekati as it attempts to navigate rough-diamond markets impacted by the current 50% US tariff on imports from India, where 90% of rough diamonds globally are cut and polished,” said Burgundy CEO Jeremy King. “Rough-diamond markets continue to be highly challenging for Ekati, and the loan facility provides the opportunity to continue operations whilst working toward a significantly lower cost profile, with a focus on higher-value diamond deposits within the Ekati complex.”

Image: An aerial view of the Ekati mine. (Burgundy Diamond Mines)