Gahcho Kué Diamond Mine — The World's Largest New Diamond Mine

The Newest Major Diamond Mine in the World

When the Gahcho Kué diamond mine achieved commercial production in March 2017, it earned a distinction that no other mine on Earth could claim: it was the largest new diamond mine to open anywhere in the world in over a decade. Located at Kennady Lake, approximately 280 kilometres northeast of Yellowknife in the Northwest Territories, Gahcho Kué extended Canada's position as one of the world's leading diamond-producing nations and demonstrated that significant new discoveries could still be brought to production even as the global diamond industry faced challenges from declining demand and growing competition from laboratory-grown diamonds.

The mine is a joint venture between De Beers Canada (51%), a subsidiary of Anglo American, and Mountain Province Diamonds (49%), a Canadian public company listed on the Toronto Stock Exchange. De Beers serves as the operator, bringing the technical expertise and operational systems of the world's largest diamond mining company to what is one of the most remote mine sites in Canada's North.

The name "Gahcho Kué" comes from the Chipewyan (Dënesülíné) language and translates to "place of the big rabbits" — a name that connects the modern industrial operation to the deep traditional knowledge and cultural relationship that Indigenous peoples have with this landscape.

Discovery and the Path to Production

The kimberlite pipes at Kennady Lake were discovered in the early 1990s during the same wave of exploration that followed the groundbreaking Ekati discovery by Chuck Fipke and Stewart Blusson. Mountain Province Diamonds, then a junior exploration company, identified the diamondiferous kimberlites and began an extended process of sampling, evaluation, and feasibility analysis that would span more than two decades.

De Beers entered the project through its Canadian subsidiary, forming a joint venture with Mountain Province. The extended timeline from discovery to production reflected several factors: the remote location, the need for extensive environmental assessment, the technical challenge of mining kimberlite pipes at and beneath a lake, and the cyclical nature of diamond market conditions that influenced the investment decision.

Key milestones in the development timeline include:

• 1995: Initial discovery of kimberlite pipes at Kennady Lake through exploration drilling.
• 1997–2005: Extensive bulk sampling programs to evaluate the diamond content, quality, and value from each pipe.
• 2006–2013: Environmental assessment process, including a comprehensive review by the Mackenzie Valley Environmental Impact Review Board. The project received its water licence and land-use permit in 2014.
• 2014: Construction begins. The first phase involved site preparation, camp construction, and the critical task of dewatering portions of Kennady Lake to expose the kimberlite pipes.
• 2016: First ore processed through the plant in August. Ramp-up to full capacity begins.
• 2017: Commercial production declared in March, with the mine reaching nameplate processing capacity of approximately 3 million tonnes of kimberlite per year.

The total capital cost of developing Gahcho Kué was approximately CAD $1 billion, making it one of the largest private-sector investments in the Northwest Territories' history.

The Three Kimberlite Pipes

Gahcho Kué's diamond resources are contained within three kimberlite pipes — designated 5034, Hearne, and Tuzo — all located at or near Kennady Lake. Each pipe has distinct geological and economic characteristics:

The kimberlite pipes at Gahcho Kué are geologically younger than many kimberlites in the Lac de Gras cluster, having intruded through the Canadian Shield approximately 540 to 610 million years ago during the Cambrian period. The diamonds within them, however, follow the same ancient pattern as other Canadian diamonds — crystallised deep in the Earth's mantle between 1 and 3 billion years ago and transported to the surface by violent kimberlite eruptions.

The combined indicated and inferred mineral resource across all three pipes is estimated at approximately 54 million carats, providing a mine life extending to approximately 2030 under the current mine plan. The potential for underground mining beneath the open pits represents additional upside that could extend operations further, though this would require additional capital investment and regulatory approvals.

Production Data and Diamond Output

Since achieving commercial production in 2017, Gahcho Kué has established itself as a consistent producer of significant diamond volumes:

The average value of Gahcho Kué diamonds has ranged from approximately US$60 to US$90 per carat, depending on market conditions and the mix of ore processed. While this per-carat value is somewhat lower than the Lac de Gras mines (Ekati and Diavik), Gahcho Kué compensates with relatively high ore grades and efficient processing. The mine has also produced notable large stones that command premium prices at tender — including several diamonds over 50 carats in the rough.

De Beers and Mountain Province: The Joint Venture

The partnership between De Beers and Mountain Province Diamonds brings together two very different entities in one of the most significant joint ventures in Canadian mining.

De Beers Canada (51%) is the operating partner and a subsidiary of De Beers Group, itself majority-owned by Anglo American. De Beers is the world's largest diamond company by value and has been involved in Canadian diamond exploration since the early 1990s. In addition to Gahcho Kué, De Beers operated the Snap Lake underground diamond mine (2008–2015, now closed and in reclamation) and the Victor mine in northern Ontario (2008–2019, now closed). Gahcho Kué is currently De Beers' only operating mine in Canada.

Mountain Province Diamonds (49%) is a publicly traded Canadian company (TSX: MPVD) whose entire business revolves around its stake in Gahcho Kué. The company receives 49% of the mine's rough diamond production and markets its share independently, primarily through regular tenders held in Antwerp, Belgium. For investors, Mountain Province offers one of the few pure-play exposure opportunities to a single, high-quality Canadian diamond mine through public equity markets.

Remote Operations and Logistics

Gahcho Kué is among the most isolated mining operations in Canada. Located approximately 280 kilometres northeast of Yellowknife with no permanent road access, the mine relies on a combination of air transport and a seasonal winter road for personnel and supplies.

Workers travel to the mine site by chartered aircraft, typically on a two-weeks-on, two-weeks-off rotation. The on-site camp provides accommodation for approximately 500 workers at any given time, with facilities including dining halls, recreation areas, a gym, and medical services. At peak employment, the mine supports roughly 700 direct jobs with additional seasonal and contractor positions.

The annual winter road season — usually from late January to late March — is critical for the mine's logistics. During this narrow window, heavy trucks transport the bulk of the mine's annual fuel supply (diesel for power generation and heating), explosives, spare parts, and other supplies that are too heavy or bulky for air freight. A missed or shortened winter road season can significantly impact operating costs and even production schedules. Climate change is an increasing concern for winter road operations across northern Canada, as warming temperatures shorten the window during which lake ice can safely support heavy truck traffic.

Water Management at Kennady Lake

One of the most significant engineering challenges at Gahcho Kué is water management. The kimberlite pipes are located at and beneath Kennady Lake, meaning that mining requires the controlled dewatering of lake sections to expose the ore bodies. This process — carefully regulated by the Mackenzie Valley Land and Water Board — involves pumping water from designated areas of the lake into adjacent water bodies through a network of pipes and channels.

The water management system includes:

• Dykes and berms: Engineered structures separate mining areas from the remaining portions of Kennady Lake, allowing controlled dewatering while protecting the broader watershed.
• Water treatment: All water discharged from the mine site — including pit dewatering, processing plant effluent, and surface runoff — passes through treatment systems to meet strict water quality standards before release into the environment.
• Fish habitat offsetting: The dewatering of portions of Kennady Lake affected fish habitat, requiring the development of offsetting measures. These include the creation and enhancement of fish habitat in nearby water bodies to compensate for the temporary loss during the mining period.
• Post-closure refilling: The mine's closure plan includes the controlled refilling of the mined areas with water to recreate a modified version of Kennady Lake. This process will be managed to ensure water quality meets standards for aquatic life and traditional use.

Indigenous Participation and Community Benefits

Gahcho Kué operates within the traditional territories of several Indigenous groups, and the mine holds Impact and Benefit Agreements (IBAs) and participation agreements with the following communities and organisations:

• Tlicho Government
• Lutsel K'e Dene First Nation
• Yellowknives Dene First Nation
• Deninu K'ue First Nation
• Northwest Territory Métis Nation
• North Slave Métis Alliance

These agreements provide employment priorities, business opportunities, training and education funding, and financial benefits to the signatory communities. De Beers has committed to prioritising Northern and Indigenous hiring, with a target of maintaining a workforce where Northern residents comprise a significant proportion of total employment. Northern and Indigenous businesses have been awarded contracts for services including catering, maintenance, environmental monitoring, and transportation.

The mine also participates in socio-economic monitoring programs that track its impacts on community well-being indicators such as income, employment, education, health, and cultural vitality. These monitoring programs are conducted in collaboration with Indigenous governments and are reviewed by the Mackenzie Valley Environmental Impact Review Board.

Diamond Quality and Marketing

Gahcho Kué diamonds span the full spectrum of quality, with a notable proportion of gem-quality stones suitable for the jewellery market. The mine's production includes diamonds across the GIA colour and clarity ranges, with a meaningful share of stones grading in the near-colourless to colourless categories that command the highest prices.

The average per-carat value at Gahcho Kué — typically in the US$60 to US$90 range — reflects the overall production mix, which includes both high-value gem stones and lower-value near-gem and industrial-grade material. Individual large or exceptional stones can achieve values many multiples of this average. Mountain Province Diamonds regularly reports its sales results, providing transparency into the pricing and market dynamics of the mine's output.

Rough diamonds from Gahcho Kué are sold through two separate channels. De Beers markets its 51% share through its established global distribution network, which includes long-term supply agreements with select manufacturers (Sightholders) and auction sales. Mountain Province sells its 49% share independently, primarily through competitive tenders in Antwerp that attract buyers from India, Israel, Belgium, and other major diamond manufacturing centres.

Environmental Stewardship and Mine Life

The Gahcho Kué mine operates under a comprehensive environmental management system designed to minimise its footprint on the surrounding Arctic ecosystem. Key environmental programs include caribou and wildlife monitoring, water quality surveillance, dust and noise management, and progressive reclamation of disturbed areas.

The mine's current life-of-mine plan extends to approximately 2030, by which time all three kimberlite pipes are expected to be depleted under the open-pit mine plan. The closure and reclamation process will follow, with the ultimate goal of restoring Kennady Lake and the surrounding landscape to conditions that support wildlife, fish, and traditional land use. The closure plan has been developed in consultation with Indigenous communities and regulators, and De Beers has established financial assurance mechanisms to ensure that closure obligations can be met regardless of future business conditions.

There is potential for mine life extension beyond 2030 if underground mining beneath the depleted open pits proves to be economically viable. Preliminary studies have indicated additional diamond resources at depth, but the decision to pursue underground development would require further engineering studies, capital investment, and regulatory approval.

Frequently Asked Questions About the Gahcho Kué Diamond Mine