The fate of the Ekati diamond mine won’t be known for at least another week, after the mine’s owner filed for insolvency protection in the Supreme Court of British Columbia.
Protection under the Companies’ Creditors Arrangement Act (CCAA) allows for businesses to come up with a plan to figure out finances so creditors can be paid, if they ever will be, and temporarily stops creditors from either suing or seizing assets.
Ekati has been in operation since 1998 and has had multiple owners over that time frame. Arctic Canadian Diamond Company (ACDC), a subsidiary of Burgundy Diamond Mines, bought the asset from Dominion Diamond Mines in 2021.
In announcing the move on May 1, Burgundy Diamond Mines stated that it would use the order to “engage in discussions with its lenders, creditors and other stakeholders, to solicit and evaluate strategic alternatives to restructure ACDC financially and operationally, as it continues to navigate difficult geopolitical, economic and industry conditions.”
According to an affidavit filed by Brent Mierau, head of finance for ACDC, the company is in a “financially distressed position” and can’t meet its obligations.
“As a result of this ongoing financial strain, ACDC’s cash reserves are depleted and absent near-term funding, ACDC cannot meet its payroll and other obligations,” stated the affidavit. “Knowing its financial situation and given the nature of a diamond mining operation, ACDC has commenced preparatory steps towards scaling down operations at the Ekati mine in an effort to preserve value.”
ACDC was given an initial $115 million loan from the federal government in December 2025, which was topped up to $175 million after an additional $60 million was fronted just this past March. That extra money was given on the promise that ACDC could raise millions in equity, which appears to have not happened as the deadline was May 1.
But even amid the dire straits, Mierau stated that the company still thinks Ekati has value.
“Given the stability that will be provided to ACDC by a stay of proceedings, the other protections afforded by the CCAA, and having a reasonable time to advance the applicants’ restructuring efforts… ACDC’s management is of the view that the overall value of ACDC’s business could be enhanced to the benefit of its stakeholders as compared to a forced liquidation scenario,” he stated.
ACDC has been able to come to terms on settlement agreements with various trade creditors — businesses that supply services to Ekati — totalling $18 million, which the company estimates is around 20 per cent of its creditor debt. It still owes close to $63 million to other creditors. That’s in addition to tens of millions of dollars owed to private debt holders.
In total, ACDC owes around $650 million.
There are costs that lie ahead, such as mine reclamation, which is estimated to have a price tag near $428 million. ACDC stated in its filing that it has several hundred millions of dollars in cash collateral, bonds and trust to address that when the time comes.
ACDC also stated that the mine employs 350 people and around 200 contractors. Thirty per cent of those are Northern-based, which includes Indigenous employees, while 20 per cent of the contractors are Northern.
In response to the filing, Industry, Tourism and Investment Minister Caitlin Cleveland stated on Monday that the GNWT is monitoring the situation.
“We understand this news will create uncertainty for workers, families and businesses across the Northwest Territories,” Cleveland stated. “Our priority right now is people. GNWT staff are ready to support any workers who may be impacted by connecting them with income and employment programs, career and mental health counselling, job referrals and retraining.”
In a statement to NNSL Media, Yellowknife Centre MLA Robert Hawkins said the announcement isn’t just another corporate restructuring.
“This is a serious warning sign for the Northwest Territories economy, Northern workers, Indigenous governments, local contractors, suppliers, and every family that depends directly or indirectly on the diamond sector,” he wrote. “Burgundy and Arctic Canadian have received extraordinary public support, including up to $175 million in federal loan support. That support was presented as a way to protect jobs, stabilize operations, support Northern businesses and preserve confidence in one of the NWT’s most important private-sector industries.
“Now Northerners deserve to know: protected for whom?” he added.
ACDC has been given until May 11 to come up to come up with a plan.