Peregrine Diamonds, with its advancing Chidliak diamond project 120 km from Iqaluit, is now property of global mining giant De Beers.
News of the acquisition came Thursday morning. De Beers is paying $107 million in cash for Peregrine’s assets.
“This offer is the result of a comprehensive review process of our options to advance Chidliak towards development. The (Peregrine) board unanimously agrees that this offer represents the best path forward available to Peregrine’s shareholders and recommends that shareholders vote in favour of this transaction,” said Eric Friedland, Peregrine’s founder and executive chairman.
Kim Truter, CEO, De Beers Canada, said, “The Peregrine team has done outstanding work progressing the Chidliak project, demonstrating its quality and high potential. With our extensive De Beers Group operating experience in similar Canadian arctic environments and employing innovative mining methods, we believe we are very well positioned to develop this resource further. We are delighted to be extending our business presence in Canada to the Nunavut Territory and look forward to working with all community and government partners as we progress the project.”
Peregrine completed a preliminary economic assessment for Chidliak earlier this year that showed more than 22 million carats of inferred diamonds — not yet proven — exist at the site. The net cash flow from the project over its expected 13-year lifetime is pegged at $2 billion, pre-tax.
The anticipated cost to get the Chidliak mine up and running is $455 million. Peregrine was also proposing a 160-km all-weather road from Chidliak to Iqaluit.
De Beers is the majority operator of the Gahcho Kue diamond mine in the Northwest Territories.