Edmonton-based Shear Diamonds Ltd. has signed a mutual cooperation agreement with Nunavut Resources Corp. for development of the Jericho Diamond Mine in Nunavut, northern Canada. Shear Diamonds, formerly Shear Minerals, acquired Jericho — Nunavut's first and only diamond mine — in July of last year. The company paid $2 million plus an aggregate of 80 million shares and a 2% royalty to Caz Petroleum, the secured creditor of Tahera Diamond, the mine's former operator.
Jericho is located 420 km northeast of the City of Yellowknife and is accessible by air all year and by winter road from Yellowknife. The project was mined from 2006 to 2008, and produced 780,000 carats of diamonds from 1.2 million tonnes of kimberlite mined from the open pit operation, before going bankrupt in 2008.
Over $200 million was invested in the development of the Jericho operations including the construction of a 2,000 tonne per day diamond recovery plant, maintenance facility, fuel farm, and offices and accommodation for 225 personnel.
The agreement signed on Monday by Shear president Pamela Strand and NRC chairman Charlie Evalik sets out provisions for mutual cooperation in the examination of infrastructure and other development opportunities associated with the potential re-development of the Jericho Diamond Mine, according to a news release. It is the first agreement of its kind to be signed by the NRC, an Inuit-owned corporation dedicated to maximize mutual benefits at the Jericho Mine.