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De Beers paid only $226 in royalties for its Ontario mine last year— report

De Beers paid only $226 in royalties for its Ontario mine last year— report

Victor mine is Ontario’s first and only diamond mine and the second of De Beers mine in Canada. (Image courtesy of De Beers)

De Beers Canada paid $226 in mining royalties to the Canadian province of Ontario between 2013 and 2014, related to its world-famous Victor diamond mine, a special report by Canadian Broadcast Corporation (CBC) shows.

The amount was determined by CBC reporter Rita Celli, based on the province’s budget and correspondence with government officials, despite both the current and a former provincial mines ministers told her that the diamond royalty was supposed to be kept confidential, she reports.

The thrifty amount compares to the almost $3.9 billion the government of Ontario received from the salt sector in the same period.

A De Beers Canada spokesperson responded to the CBC report, acknowledging that while the royalty figure was likely correct, the company is only now recouping its $1 billion investment in developing Victor mine.

The company anticipates eventually paying tens of millions of dollars in royalties from the project during the life of the mine, which currently extends to 2018. The Victor mine officially opened in July 2008.

The Ontario Ministry of Northern Development and Mines is bound by law to the terms of its royalty agreement with De Beers Canada confidential. However, the CBC determined that the province’s finance department reported the revenue from salt and diamond royalties together, as a single line item, in the provincial budget.