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A diamond boom in the North

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Just 20 years ago, very few people believed that a diamond industry was even possible in Canada. Yet, from 1998 to 2002, about 13.8 million carats of this precious gemstone were mined, with a total value of $2.8 billion. That’s roughly equivalent to a 1.5‑kilogram bag of ice each day for five years, with each bag worth $1.5 million.

Increased investment in the diamond industry has begun to show dividends. In 2004 alone, a total of 12.6 million carats of diamonds were mined in Canada, with a value of $2.1 billion. Along with the established Ekati and Diavik mines in the Northwest Territories, diamond exploration has begun in Ontario and Nunavut.

The industry has been a windfall for the territories. Diamond mining accounted for just over one-fifth of the Northwest Territories’ gross domestic product in 2002. Like in any economic boom, many share the benefits, including the non-residential construction, wholesale trade and transportation industries. In 2002, more than 9,000 loads of materials were transported to the Ekati and Diavik mines.

Chart: Diamond production valueDiamond mining means both direct and indirect employment for many northern and Aboriginal residents. Of the over 1,400 workers employed by the Ekati and Diavik mines, three out of four are northern residents and almost 4 out of 10 are Aboriginals.

Canada’s diamond mines are not just abundant, they also produce gems of very high quality. In 2001, the average price per carat of a Canadian diamond was the third highest in the world at $228, behind only Namibia and Angola. Canada has also shifted from being a net importer of diamonds to being a net exporter. The United Kingdom and Belgium are the principal destinations for Canadian diamonds.