Dominion Mulls Ekati Underground Project

Dominion Diamond Corporation is considering extending its Ekati mine operation by seven years with a $628 million investment to go underground. With production coming from six open pits and two underground operations, the current mine plan at Ekati accounts for operations until 2035. The Fox Deep project will prolong the mine’s life to 2042, and yield an additional 11 million carats.

The Fox open pit has not been operating since 2014, after a decade of mining that produced more than 8.7 million carats, Dominion explained in a statement on Thursday. SRK Consulting (Canada) conducted a preliminary economic assessment at a net present value of $187 million.

The company has already begun conducting a pre-feasibility study, expected to be completed by the end of the year, for Fox Deep, which will provide more details on the viability of the project. Dominion has also mentioned two of its major investors, Institutional Shareholder Services and Glass, Lewis & Co., have recommended other shareholders back the prospective $1.2 billion takeover by the Washington Companies. A meeting to approve the deal is scheduled for September 19.

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