TORONTO (miningweekly.com) - Diamond giant De Beers is considering increasing production next year at its Snap Lake mine, in Canada's Northwest Territories, and will likely make a decision early in November, spokesperson Cathie Bolstad said on Wednesday.

De Beers Canada announced a day earlier it had cancelled a previously planned winter shutdown, because of improving market conditions, but the mine continues to operate under a "significant curtailment of operations", she said in an interview.

"We are at about probably half the size of what we would normally be."

De Beers is 45%-owned by mining group Anglo American.

After rough diamond demand plummeted in the fourth quarter of last year, the company cut employee and contractor jobs at Snap Lake and reduced output, first late in 2008 and then again in February this year, to trim costs and match market demand.

Now, however, Bolstad said the diamond-miner is seeing trends "that are looking more positive for the industry," both in terms of prices and in terms of quantities.

The months between the Thanksgiving holiday in the US and Valentine's Day, in February, are traditionally the strongest demand period for rough diamonds.

"And we are still watching very closely and cautiously, but we have seen an increase in demand for our rough diamonds," she said.

Besides Snap Lake, in the Northwest Territories, De Beers Canada also owns and operates the Victor mine, in Ontario. Both mines closed for six weeks during the summer.

At Snap Lake, the company has drawn up several scenarios for production in 2010, "including scenarios that see us ramping back up again," Bolstad said.

The plans are currently making their way through the "family of companies" approval process, with a final decision anticipated early in November, she said.

"We are ready to ramp up, if that's the decision that is made, in terms of demand.

"We are ready to recruit, we're ready to go."

However, with the mine located in Canada's remote Arctic region, De Beers Canada needs to coordinate its planning well in advance, to ensure that any extra supplies and fuel needed can be brought in on the winter ice road that it maintains with BHP Billiton and Rio Tinto.

The winter road joint venture has had its first meeting for the upcoming season already, and De Beers Canada has been meeting with its contractors that provide the supplies on the winter road.

"We obviously need to work very closely with them so that if, for any reason, we step up what we are bringing in, we've got that plan in place to do that as well," Bolstad said.

"Those are always the unique complexities of living in a remote region like we do."

The Snap Lake and Victor operations, which De Beers officially opened in July 2008, are the group's first producing mines outside the Southern Hemisphere.