Dominion Diamond Corp. recently reported the results of a prefeasibility study on the Jay kimberlite pipe deposit located within the buffer zone joint venture property in Canada’s Northwest Territories. Jay is the most significant undeveloped deposit at the Ekati Diamond mine due to its large size and high grade. It is located beneath Lac du Sauvage, a moderate sized lake north of Lac de Gras, and is approximately 1.2 km from the shoreline.
The Jay pipe is approximately 7 km to the northeast of the Misery Pit and related infrastructure, and 30 km to the southeast of the main Ekati mine infrastructure.
The Jay PFS estimated 84.6 million carats (ct) at a grade of 1.9 ct per metric ton (ct/mt) contained within 45.6 million mt of ore with a stripping ratio of 3.99 (182.1 million mt waste). The initial development capital total is $657 million with a pre-stripping capital investment of $33 million and sustaining capital of $148 million. Assuming an average diamond price of $86/ct, the pre-tax NPV for the Jay project would be $1.13 million with an operational mine life of 11 years. Operating costs per ton processed total $75/mt, providing a pre-tax IRR of 21%.
“Completing this pre-feasibility study is an important milestone for Jay, a project that we hope will be a significant growth opportunity for the company and a long-term pillar of the Northwest Territories economy,” said Brendan Bell, acting chief executive officer.
The study evaluated the development of Jay as a stand-alone open-pit operation, which would supply ore to the existing process plant at its full capacity of approximately 4.3 million dry metric tons per year (mt/y) for approximately 11 years beyond the current projected closure of the Ekati Diamond mine in 2020. This will require construction of a water retention dike encircling the pipe, allowing the isolated area to be dewatered ahead of the start of pre-stripping and mining operations.
Dominion compiled and prepared the Jay study with the assistance of its consultants Golder Associates Ltd. and Peter Ravenscroft, FAusIMM, of Burgundy Mining Advisors Ltd.