De Beers Canada says it plans to take over the company behind the Chidliak diamond mining project in Nunavut. In a Thursday morning news release, the corporation announced it has entered into an approximately $107 million agreement to acquire all outstanding securities of Peregrine Diamonds Ltd. at $0.24 per share.
Peregrine owns and operates the Chidliak diamond exploration project, located 120 kilometres northeast of Iqaluit on Baffin Island.
De Beers Canada, which is headquartered in Calgary, previously declined to invest in the project in 2013 after signing an option agreement with Peregrine the previous year. If it had agreed to the joint venture, it would have invested almost $60 million in Chidliak over five years, operating and having majority interest in the project.
A total of 74 kimberlite pipes have been discovered at the site including two pipes — named CH-6 and CH-7 — which are the focus of phase one of Peregrine’s development program. The pipes are expected to produce more than 22 million carats.
Peregrine’s recent economic assessment estimates the CH-6 pipe alone will produce 24.1 carats per tonne at a diamond valuation of $360 US per tonne.
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