Photo by: Dominion Diamond Corp
TORONTO (miningweekly.com) – Multimillionaire Canadian diamond magnate Charles ‘Chuck’ Fipke has agreed to sell his remaining stake in Canada’s first diamond mine, the Ekati mine in the Northwest Territories, for $67-million to majority owner Dominion Diamond Corp.
Having discovered diamonds around Lac de Gras, in Canada's Northwest Territories in the 1970s, Fipke focused his life’s work on finding the precious gems in Canada’s far north. A joint venture (JV) between Fipke's Dia Met Minerals and BHP Utah in the 1980s and 1990s, climaxed in establishing the Ekati mine in 1998, with Fipke and prospecting partner Dr Stewart Blusson each holding a 10% interest in the mine.
Toronto-based Dominion, which last year bought out diversified miner BHP Billiton’s stake in Ekati for $553-million, said the sale would end Fipke's financial involvement in the mine.
“Although the sale by Chuck Fipke of his interest in the Ekati project ends his financial involvement with Canada's first diamond mine, his contribution to its discovery and success goes well beyond that. The history of Canadian mining is full of stories of accidents of fate leading to discoveries, but the discovery of diamonds in the Slave Geological Province is a story of years of dedicated technical work led by a focused technical expert with unwavering belief in the outcome,” Dominion chairperson and CEO Robert Gannicott said.
Through his holding company C Fipke Holdings (FipkeCo), Fipke owns a 10% interest in Ekati’s Core zone which includes the current operating mine and other permitted kimberlite pipes and another 10% in the Buffer zone, an adjacent area hosting kimberlite pipes with both development and exploration potential.
Fipke will sell his Core zone interest for $50-million and his Buffer zone interest for $17-million, both amounts being subject to possible adjustments for interest and JV contributions.
Dominion currently holds an 80% participating interest in the Core zone, with FipkeCo holding a 10% participating interest and Blusson holding the remaining 10% participating interest. Dominion also holds a 58.8% participating interest in the Buffer zone, with FipkeCo holding a 10% participating interest and Archon Minerals holding a 31.2% participating interest.
The stakes Dominion intends to buy from Fipke will be somewhat less should Blusson and Archon exercise their rights of first refusal within the next 60 days as provided for under the JV agreements.
The transaction was expected to close in September.
Dominion expected to produce about 900 000 ct of rough diamonds from Ekati during the current 2015 fiscal year.