TORONTO (miningweekly.com) – Recent media reports that first output from De Beers' Gahcho Kué diamond mine, in northern Canada, could move to early 2017 because of shipping delays, were on Monday dispelled by minority interest holder Mountain Province Diamonds.

Mountain Province said that, as at the end of February, the overall project was 17% complete and first production remained on schedule for the third quarter of 2016.

In a statement issued on Friday, diamond major De Beers, which holds a 51% controlling interest in the project, confirmed that there had been no change in the project schedule and that “both partners are happy with the progress to date”.

News agency Reuters on Friday reported that De Beers CEO Phillipe Mellier had said in an interview that first output would be delayed as a result of regulatory restrictions limiting shipments to Gahcho Kué this winter, which delayed construction.

Mountain Province in January reported that regulatory restrictions imposed on the joint venture (JV) had limited the material that could be trucked to site this winter. In particular, shipments of cement and steel were delayed.

It said that the JV was exploring opportunities to mitigate the impact on the project schedule, but warned that in the event that appropriate mitigation measures were not found, mechanical completion of the process plant and cold commissioning would occur in the second quarter of 2016, and first production in the following quarter.

The JV gained access to the ice road from February, and to date, took delivery of about 670 truckloads of equipment and supplies, and expected about 100 more before the end of March.

Mountain Province reported that the main airstrip was currently under construction and prefabricated units of the main camp were being delivered to Gahcho Kué.

The main camp and airstrip were expected to be ready for use by midyear.

Meanwhile, eight 500 m³ fuel tanks had been installed and fuel deliveries were currently under way. The installation of two 18 000 m³ fuel tanks were also under way and enough fuel would be delivered to site to support the construction operation for the next 12 months.

Meanwhile, the JV was working on preparing a feasibility study update and the results would be announced by the end of the month. The updated feasibility study would include an updated reserve statement, updated capital and operating cost estimates, and updated project economics.

Further, Mountain Province said that it expected the Gahcho Kué full land use permit and Class A water licence to be approved during the second half of the year.

DOWN THE RABBIT HOLE

Gahcho Kué, which is Chipewyan for ‘a place where big rabbits are found’, is located at Kennady Lake, 280 km north-east of Yellowknife and 80 km east of De Beers’ existing Snap Lake mine, in the Northwestern Territories. The diamond prospect is one of the largest new diamond projects under development globally.

The project consists of the Hearne North and South pipes; the 5034 West pipe, the Central and North-East pipes; the 5034 South pipe; the 5034 North pipe; Wallace; and the Dunn Sheet, Tuzo and Tesla diamondiferous kimberlite pipes, sheets and dykes.

Gahcho Kué consists of a cluster of kimberlites, three of which have a probable mineral reserve of about 31.3-million tonnes grading at 1.57 ct/t (about 49-million carats).

The project will have an estimated production rate of three-million tonnes of ore a year and 4.5-million carats a year.

The project design is based on the openpit mining of the 5034, Hearne and Tuzo deposits in a sequential fashion.

Mine plans call for the extraction of 233.7-million tonnes of waste and 31.3-million tonnes of ore over 11 years using standard drill/blast and truck/shovel equipment and pit designs, which are similar to those of other openpit diamond mines operating in the area.

Ore will be fed to a three-million-tonne-a-year processing plant, with three stages of crushing, dense-medium separation and X-ray/grease diamond recovery circuits.

Supporting infrastructure includes a 14.1 MW packaged diesel power plant, a 1 350 m gravel airstrip, a five-bay truck shop, an emulsion plant, a 40-million-litre fuel storage facility and a 432-bed accommodation/office complex.

De Beers, as operator of the Gahcho Kué project, had in January entered into an impact benefit agreement with the Tlicho government for the proposed mine. The agreement establishes a framework for De Beers and the Tlicho government to work together over the life of the mine, enabling participation by the Tlicho government in the opportunities that the mine provides.

The agreement was signed in Yellowknife on Friday, January 24, 2014.