18-6-2020
Dominion Diamond Mines has sued its partner at Diavik mine, Diavik Diamond Mines Inc. (DDMI) in the Supreme Court of British Columbia, where Dominion is incorporated, alleging that DDMI maintained full operations at the mine while knowing that Dominion has no ability to pay for such cash calls and created a liquidity crisis for Dominion that rendered it insolvent.
Dominion accuses that DDMI’s operation is significantly over budget and production has failed to meet targets. Operation costs at the mine rose seven percent more than planned in 2019, while total carats recovered were 8.5 percent below plan. Yet, DDMI failed to provide requested information about the project to Dominion. The cash call payments for full operations at Diavik during pandemic have drained Dominion's cash reserves and contributed to Dominion's liquidity issue.
“We regret Dominion filing what are baseless claims against us and will be defending ourselves in court vigorously. Diavik has at all times acted appropriately. We remain focused on managing the mine safely just as we continue to protect Diavik’s interests in Dominion’s insolvency proceedings and the jobs of the more than 1,120 people who work at Diavik,” the spokesperson of Rio Tinto stated.