Stornoway Diamonds (Canada) Inc. is filing for bankruptcy protection for the second time in four years as the gem miner struggles to deal with volatile pricing on global markets. Its future now looks murky as a Quebec government spokesman said the province will put no more public money into the venture.
The privately held company said Friday it is immediately suspending operations at its Renard site in Northern Quebec while it plots a path forward. About 75 people out of a work force of 500 will perform tasks such as maintaining equipment and other assets toward an eventual return of operations, Stornoway said.
Renard is the province’s first and only diamond mine and one of four active in Canada. “The growing uncertainty of the diamond price in the short and medium term, coupled with the significant and sudden drop in the price of the resource on the world market, have had a major impact on the company’s long-term financial situation,” Stornoway said in a statement.
“This was in part due to the halt in the import of rough diamonds to India and by the global geopolitical climate.” After a surge in consumer demand during the COVID-19 pandemic fuelled by government stimulus measures, the diamond industry is now experiencing a deep correction and prices have tanked.
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