Mountain Province Anxious over Finances Amid Market Weakness

Mountain Province has expressed concerns over repayment of joint-venture fees it owes De Beers, after low demand has presented sales challenges.

The company has a debt of CAD 49.2 million ($36.3 million) to De Beers, its partner in the Gahcho Kué site in the Northwest Territories, the Canadian miner said Monday. Mountain Province owns 49% of the project, while De Beers holds the remainder.

Mountain Province hopes the proceeds from its scheduled diamond sales will cover its debt payments, the first installment of which is due March 17. The companies are collaborating to identify strategies to decrease joint-venture expenses.

Mountain Province and De Beers have halted work on the Tuzo mine, following a thorough assessment of the project’s financial situation and the difficulties facing the industry. The companies will continue to assess the market conditions to decide when to continue developing the site.

Following Mountain Province CEO Mark Wall’s resignation at the end of last year, the board decided not to seek a replacement at this time, as a cost-saving measure, instead appointing Comerford, its chairman, as acting president and CEO.

“The challenges currently facing the company largely reflects the prolonged weakness in the diamond sector,” said Mountain Province CEO Jonathan Comerford. “In this environment, our focus remains on carefully managing costs, protecting liquidity, and making measured decisions to support the long-term sustainability of our operations. We are working closely with De Beers and our stakeholders to address the in-kind election notices and to secure the ongoing viability of both the company and the Gahcho Kué mine.”

Image: A haul truck at the Gahcho Kué mine in Canada. (Mountain Province)