Mountain Province bounces back as diamond demand returns

Hearne pit at Gahcho Kué diamond mine in the Northwest Territories. (Image courtesy of Mountain Province Diamonds.)

Mountain Province Diamonds (TSX: MPV) saw profits jump in the second quarter of the year as consumer demand for precious stones returned and covid-19 cases at its 49%-owned Gahcho Kué mine, in Canada’s Northwest Territories, dropped. 

The Toronto-based miner reported a profit of C$22.5 million ($18m) for the three months ending June 30, compared with a loss of C$26.8 million ($21.4m) during the same period last year. The figure is also above 2019’s second-quarter profit of C$10.3 million ($7.7m). 

Gahcho Kué, operated by 51% owner De Beers, was hit earlier in the year by an outbreak of covid-19 cases, forcing the companies to shut down the operation for 22 days

Gahcho Kué mine was hit earlier in the year by an outbreak of covid-19 cases and it was shut down for 22 days. 

The situation improved in the three months to June 30, with Mountain Province reporting a 14% increase in production to 1.76-million carats, compared to the same period in 2020.   

Total tonnes of ore mined increased by 28% year-on-year to 8.75 million tonnes. 

“The positive market environment which began at the start of the year continued through the second quarter [and it’s] expected to continue through the second half of 2021 as consumer confidence and spending levels continue to recover,” the miner said. 

The projection is also based on the fact that the United States and China continue to promote consumer spending as part of their post-covid-19 recovery plans, Mountain Province noted. 

Chief executive Stuart Brown said production at Gahcho Kué mine was back on track to meet its guidance for the year.

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