Nunavut's first diamond mine owners owe Canada $2 million

Shear Diamonds (TSX VENTURE:SRM), the company that bought Canada’s Jericho mine site in 2010 after the previous owners went bankrupt, owes over $2 million in cleanup costs.

In an email to CBC News, federal government spokesperson Genevieve Guibert confirmed the company has failed to pay any amount related to the cleanup of the now closed mine, although it still hasn't declared bankruptcy.

Shear Diamonds’ executives have been missing since last year, right after the company realized it was in financial trouble. Within 48 hours, Shear did some basic cleanup at the Jericho site, and all its staff members were flown out.

Regulators found out about it a few days later.

On Nov. 15, Shear revealed it was facing “challenges”, including the loss of top executives and a debt of about $3 million with the Belgian diamond firm Taché.

In the news release, Shear hinted it was looking for a buyer and said it wanted to enter into “a transaction, whether financing, joint venture, sale or otherwise that will either allow Shear to advance its Jericho project or to otherwise realize value for Shear’s stakeholders.”

The Jericho mine was Canada’s third and Nunavut’s first diamond mine.