Notification of Suspension of Operations at Snap Lake Mine

DECEMBER 4, 2015 LETTER SENT TO THE NWT CHAMBER OF COMMERCE FROM DE BEERS GROUP OF COMPANIES

As you may know, global diamond markets are experiencing an extended downturn with falling demand and reduced prices. De Beers Canada, as part of The De Beers Group of Companies, has undertaken a thorough review of all available options at all operations around the world to ensure our company can continue to weather the economic crisis.

At Snap Lake Mine in particular, during 2015 we put new leadership in place, improved cost controls, introduced a new long hole stoping mining method, and began restructuring at the mine and across our Canadian operations in an effort to improve efficiencies and contain the costs of production at the mine. Unfortunately, as improvements were made, global markets deteriorated even faster, leading to the unfortunate decision to suspend operations and place the mine on care and maintenance.

De Beers intends to maintain a small workforce on the mine site who will be responsible for ensuring Snap Lake Mine continues to meet conditions of the Mine water licence and other requirements.  Our commitment to the NWT remains and the Gahcho Kué Project is continuing and construction is scheduled for completion in 2016. We are working to transfer as many employees as possible to the Gahcho Kué Project. We recognize the impact on our employees, including valued NWT contractor employees, and are working to ensure everyone’s safe return home from the mine. We have made provisions to meet all requirements for severance and notice under the NWT Employment Standards Act for all impacted employees of De Beers Canada.

We have already identified a number of De Beers’ Snap Lake employees for immediate transfer to Gahcho Kué. We hope that during the first quarter of 2016 we can select additional De Beers’ employees with the required skills and experience for transfer to Gahcho Kué. We are also looking at other opportunities to help employees with the successful transition to new employment and will endeavor to help them and their families through this difficult time.

We recognize the impact the decision to suspend operations at Snap Lake will have on the people and economy of the Northwest Territories. The decision to place Snap Lake Mine on care and maintenance was difficult but with the current sustained economic challenges, it has become necessary.

As the economic climate evolves, we will review the situation to consider whether global markets have improved sufficiently to allow for the resumption of operations at Snap Lake.

Sincerely,
Glen Koropchuk
Chief Operating Officer

2015 12 04 DBC(Koropchuk) ltr NWTCoC(Bradshaw)-1

Canadian Chamber Analysis of 2015/16 Federal Budget

See the link below for the Canadian Chamber of Commerce summary of the federal government’s 2015/16 Budget.  There are a number of paragraphs highlighted that reflect “wins” for the North and small and medium sized enterprise across the country.  Among them:

NWT Debt Cap

The debt caps for the Northwest Territories and Nunavut will be raised to $1.3 billion and $650 million respectively (pending Governor-in-Council approval) increasing the amounts these territorial governments can borrow to invest in the infrastructure needed for private sector economic development.

SME Tax Savings

The big highlight was that the small business tax rate will be reduced from 11% to 9% by 2019 (0.5% reduction each year starting Jan 1, 2016), resulting in $2.7 billion in tax savings through 2020.

Both of these are issues that both the Canadian Chamber and the NWT Chamber have been advocating for some time.

2015-16 FEDERAL BUDGET ANALYSIS

PUBLIC MEETING – Hydraulic Fracturing Filing Regulations

On Tuesday, April 21, 2015, an information session on the Hydraulic Fracturing Filing Regulations will be held in Fort Simpson, NT from 5 pm to 7 pm at the Fort Simpson Recreation Centre.  This meeting is being presented by the Government of the Northwest Territories (GNWT) – Industry, Tourism and Investment (ITI).

The resource sector is the single largest contributor to the NWT economy.  The NWT has world-class oil and natural gas reserves and has had an active petroleum industry for a century.  Mining has created more than 28,000 jobs and produced $46 billion in minerals since the early 1930s.

In 2014, the GNWT signed the Devolution¹ agreement with the Canadian federal government with the result that land and water rights management was moved to the GNWT.  With this transfer, the GNWT inherited regulations from the National Energy Board (NEB) and other federal government bodies.

The GNWT reviewed these, found them inadequate and drafted a new set of regulations to better reflect northern priorities and provide greater certainty.  This draft document will be presented to the public through a series of public meetings, one of which will be on Tuesday, April 21 in Fort Simpson.  The government is looking for additional feedback so the new regulation will reflect the priorities of the people.

The proposed new regulations set out the filing requirements for industry with four new requirements designed to meet northern priorities:

baseline surface and groundwater information
public disclosure
measures to address air quality
enhanced reporting

To learn more, visit:  http://www.iti.gov.nt.ca/infopage/hydraulic-fracturing-filing-regulations-information

These documents will help you understand the proposed changes and give you some background to better understand those changes.

proposed_regulations_clean

final_plain_language_summary_hf_regulations

final_news_release_-_proposed_hf_regulations.docx

final_backgrounder_-_environmental_assessment_coordination.docx

faq_apr17

monitoring_and_research_related_to_hydraulic_fracturing_in_the_nwt

final_nwt_regulatory_system_at_a_glance

backgrounder_-_proposed_hf_regs_docx

final_backgrounder_-_monitoring_and_research

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¹Devolution is the statutory granting of powers from the central government of a sovereign state to government at a sub-national level, such as a regional, local, or state level. It is a form of decentralization. Devolved territories have the power to make legislation relevant to the area. Wikipedia

FSCC Looking For Office Space

In our bid to find some office space, we met with His Worship Mayor Sean Whelley to discuss the feasibility to have office space in the Visitor Centre.  This is a long view with recognition of the VOFS moving to a new building in the future.

NOTE:  Our office is presently in the Nogha Enterprises Ltd building.

NOTES FROM FS CHAMBER MEETING SEPT 25

Destination Nahanni Project

Industry, Tourism and Infrastructure (I.T.I.) is spearheading a local project called Destination Nahanni.  It’s goal is to create tourism packages for an upcoming advertising push for the Nahanni National Park.  Calling on local businesses to step forward, packages are being created that include accommodations and a variety of local activities from traditional foods to sports events.  To learn more, take a look at the information provided.

Members and local businesses are all invited to become involved.  For more information, contact Marion Storm at I.T.I. Fort Simpson.

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