Arctic Canadian Diamond: a financial model to 2039, and a receiver to close the mine

Among the things FTI Consulting reviewed in the ten weeks before this proceeding changed shape was a financial model running to 2039, built on the life-of-mine plan for Ekati, per Second Report of the Monitor, July 13, 2026, para. 14.

On July 14, 2026, the Supreme Court of British Columbia appointed a receiver over the mine whose mandate is to wind it down and reclaim the ground it sits on.

The CCAA, in ten weeks

Arctic Canadian Diamond Company Ltd. and Burgundy Diamonds (Canada) Limited obtained an initial order on May 1, 2026 in the Supreme Court of British Columbia, Vancouver Registry. FTI was appointed monitor, and the stay ran to May 11 and reached the parent company, Burgundy Diamond Mines Ltd., as a non-applicant stay party, per Second Report of the Monitor, July 13, 2026, paras. 1–2.

At the comeback hearing on May 11 the Court extended the stay to July 26, revised the court-ordered charges, and approved an interim financing facility in an amount not to exceed $60 million — advanced not by a bank but by the Canada Enterprise Emergency Funding Corporation, secured by an interim lender's charge. A sale and investment solicitation process was approved the same day, per Second Report of the Monitor, July 13, 2026, para. 3 and Order (Sale and Investment Solicitation Process), May 11, 2026.

That $60 million came in two pieces, and the second was conditional. The initial tranche of $10 million was advanced — $9,727,129.54 net of fees — and funded the proceeding. The second tranche, $50 million, was conditional on the interim lender being satisfied with the bids received in Phase 1 of the sale process, per Second Report of the Monitor, July 13, 2026, para. 7.

Phase 1

Potential bidders had to deliver a non-binding letter of intent to the Monitor by 5:00 p.m. Pacific on July 10, 2026, for the sale of or investment in the applicants' interest in the Ekati mine.

The Monitor's report on what arrived is one sentence: "No LOIs were received that satisfied the criteria to be considered Qualified LOIs as defined in the SISP," per Second Report of the Monitor, July 13, 2026, paras. 5–6.

On that footing the applicants did not expect the interim lender to fund the $50 million, and said so. Without further funding they would be unable to meet ongoing operating and administrative costs, and an alternative path had to be pursued, per Second Report of the Monitor, July 13, 2026, paras. 7–8.

The cash was better than forecast, which changed nothing

For the ten weeks to July 10, 2026 the applicants ended with approximately $14.0 million on hand against a forecast $3.1 million — a favourable variance of about $11.0 million.

The components are worth reading, because none of them is a sale. Diamond sales came in at $27.4 million against $29.4 million forecast, an unfavourable variance of 7%. Against that: about $4.5 million favourable on total operating disbursements, about $3.0 million favourable on capital expenditure because of delays, and about $3.7 million favourable on surety payments. A line for GNWT mineral leases forecast at $903,000 was not paid at all, per Second Report of the Monitor, July 13, 2026, paras. 21–23.

Cash accumulated because the business spent less, not because it earned more — and the applicants had already allocated much of it. They advised the Monitor they planned to use approximately $3.5 million to pay accrued vacation pay owing to employees and approximately $2.1 million for accrued payroll and related payroll tax remittances, per Second Report of the Monitor, July 13, 2026, para. 23.

The government had been in the room the whole time

The Monitor's list of its own activities records what was building alongside the sale process: weekly meetings with counsel and advisors to the Government of the Northwest Territories, contingency planning with the GNWT and its legal and financial advisors, responses to its information requests, and facilitating its access to documents and records related to potential reclamation, per Second Report of the Monitor, July 13, 2026, para. 14.