Rio Tinto to spend U$40M on Diavik diamond mine expansion

Rio Tinto (NYSE: RIO; LSE: RIO; ASX: RIO) is going ahead with a US$40-million expansion of its iconic Diavik diamond mine in the Northwest Territories, which will extend the operation’s life to at least early 2026.

The approved first phase of the project will expand diamond extraction underground, below the existing A21 open pit. Mining of that area, opened in 2018, recently concluded.

A second phase at an additional cost will be put forward for approval in 2024, Rio said.

Phase one below A21 is slated to produce an extra 1.4 million carats, with phase two adding another 800,000 carats.

“This is good news for our employees, partners, suppliers and local communities in the Northwest Territories,” Sinead Kaufman, Rio Tinto Minerals’ chief executive, said in a statement.

In 2021, Rio Tinto became the sole owner of the operation, after buying the 40% share held until then by Dominion Diamond Mines.

The company has operated Diavik since production began in 2003. Located approximately 300 km north-east of Yellowknife, the mine employs over 1,100 employees, of which 17% are Northern Indigenous people. 

Diavik is Canada’s largest diamond mine in terms of production with between 6 and 7 million carats of rough diamonds produced each year. Since mining began in 2003 Diavik has produced over 100 million carats of diamonds. 

The Northwest Territories’ two other diamond mines – Ekati, operated by Arctic Canadian Diamond and De Beers-Mountain Province’s Gahcho Kué  – are expected to close in 2024 and 2028, respectively.

Diavik is about 30 km southeast of Ekati, and Gahcho Kué is 125 km southeast of Diavik.