Renard diamond mine relaunch

The Renard diamond mine in Stornoway will resume service in Nord-du-Québec.

Osisko, which owns 35.1% of Stornoway, said on Monday that the stimulus includes cost cuts of more than $ 30 million over the next 16 months. In addition, Stornoway shareholders will invest $ 30 million in a senior credit facility.

“This additional commitment will allow Stornoway to have the financial flexibility required to continue to operate in a difficult market environment. No draw is planned at this time as Stornoway still has approximately $ 10 million in cash and approximately 332,000 carats in inventory which will be sold by the end of 2020, ”Osisko said in a statement.

“The diamond market continues to be difficult. However, structural barriers to diamond sales are easing and increased demand has improved the prices observed for some specific products, ”added Osisko, who took control of Stornoway with other creditors last November. Finding no buyer, Stornoway then came to an agreement with his creditors who took over the company without paying a penny, but who had to assume all of its heavy debt.

“The Stornoway team has demonstrated the ability to operate the Renard mine efficiently and the short-term cost reductions will help increase profitability. We believe that the Renard mine still has significant value as diamond mines become rarer and has seen more than $ 1 billion invested in its high quality infrastructure over the past few years. years, ”said Osisko Chairman and CEO Sean Roosen

The Renard project is the first diamond mining complex in operation in Quebec. It is located approximately 250 kilometers north of the Cree community of Mistissini and 350 kilometers north of Chibougamau.

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