Dominion shares tank as fire shuts Ekati plant
Dominion Diamond Corporation (TSX:DDC, NYSE:DDC) announced on Monday it is still assessing damage after small fire halted processing operations at its ageing Ekati diamond mine in Canada’s far north last week.
Dominion said in a statement the fire that broke out on Thursday last week was extinguished the same day and all personnel were safely evacuated from the plant and no injuries have been reported.
The miner said its “initial assessment of the process plant confirms damages were limited to a small area, with no damage to the main structural components,” but the technical team is not able to say at this point how long the shutdown would last. Surface and underground mining has not been affected and ore will be stockpiled while the plant is repaired.
Shares in Dominion Diamond were off 6% in afternoon trading on the Toronto Stock Exchange affording the company a $983 million market worth. Toronto-based Dominion has lost nearly a fifth of its value this year as expansion plans at Ekati is delayed and the diamond market struggles through a downturn.
Earlier this month, Dominion Diamond said it was not planning to begin construction of the new Jay pipe until 2018, a year later than previously planned.
The project, which would add about 13 years to the mine’s life, received the Northwest Territories government’s blessing in July, but Dominion said it was still waiting for permits needed to start construction, adding that existing reserves at Ekati were enough to prevent the cessation of mining that Jay was originally intended to prevent.
Ekati, which Dominion bought from BHP Billiton in 2013 is located in Canada’s North West Territories, 300 kilometres northeast of Yellowknife, close to Rio Tinto’s Diavik mine.