Canada approves construction of new diamond mine


Oct 22 (Reuters) - The Canadian government on Tuesdayapproved the development of the Gahcho Kue diamond mine, theproject's owners De Beers Canada and Mountain Province Diamonds said, setting in motion the building of the country'ssixth diamond mine.

Gahcho Kue, 280 km (175 miles) northwest of Yellowknife inCanada's remote Northwest Territories, is expected to take twoyears to build. It is forecast to produce an average of 4.5million carats a year over 11 years of mine life.

The approval by Canada's minister of aboriginal affairs andnorthern development means Gahcho Kue's land use permit andwater license can now be processed. The mine will employ some700 people during construction.

In August, several aboriginal groups in the NorthwestTerritories urged the federal government not to approve the mineplan in its proposed form, arguing that it would damage waterquality, caribou populations and the future of a lake, theCanadian Broadcasting Corp reported.

De Beers, a unit of Anglo American Plc, already hastwo producing diamond mines in Canada, Snap Lake in theNorthwest Territories and Victor in northern Ontario.

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