Chidliak owner to re-think its involvement in diamonds

An equipment shed at Peregrine Diamond Ltd.’s Aurora exploration camp, about 120 kilometres northeast of Iqaluit, flies the flags of Canada and Nunavut. (FILE PHOTO)

The global mining giant, BHP Billiton, which owns 51 per cent of the Chidliak diamond property near Iqaluit, plans to review its investments in diamonds, a company news release said Nov. 29.

That review, to be done by the end of January 2012, could result in the sale of BHP’s interests in Chidliak and in the Ekati Diamond Mine in the Northwest Territories.

“Potential transactions arising from the review will be subject to detailed analysis before a final decision is made,” the company said.

BHP also said it will only pursue options that preserve the company’s safety and environmental record, and protect benefits created for local communities.

Peregrine Diamonds Ltd., which does exploration at the Chidliak site on behalf of BHP, plans a major bulk sampling program to start early next year.

The company has discovered 59 kimberlites at Chidliak, some yielding what the company has described as “world-class” grades.

While the project is owned 51 per cent by BHP, Peregrine continues to operate the exploration program.

In 2011, the company spent $17.7 million on exploration at the site and hired about 35 workers from Iqaluit. Next year, it plans to start a bulk sampling project aimed at testing the commercial viability of the property’s kimberlites.

However, BHP said that it seeks “large, long life, upstream and expandable assets” and that years of exploration have produced “few options for new diamond mines.”