The Stornoway Diamonds company announced Friday that it is, once again, placing itself under bankruptcy protection, and is “temporarily suspending” operations at its Renard mine located in Nord-du-Québec. Nearly 425 people were laid off.
In a press release, the mining company explains that “the growing uncertainty in the price of diamonds 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 its financial situation.
“This is partly explained by the cessation of imports of rough diamonds into India and by the global geopolitical climate,” underlines the company.
The company, which until this morning had 500 employees, is keeping only 75 to ensure the “upkeep and maintenance” phase, which will “preserve assets and facilitate a rapid return to normal operations”.
Stornoway, which hopes to find new investors or a buyer, has started a process in this direction.
Recurring financial difficulties
This is not the first time that the mining company has been in financial difficulty and has had to protect itself from its creditors.
Already, in 2019, the government of François Legault came to the aid of the company by adopting a decree allowing Investissement Québec to “acquire part of the assets” of the Renard mine and “pay it additional sums” so that it can continue its operations.
The Stornoway company is owned by Osisko, Diaquem – a subsidiary of Investissement Québec, the Caisse de dépôt et placement du Québec and Triple Flag Canada.
Further details will follow.
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