Mountain Province Diamonds Inc and joint venture partner De Beers Canada Inc have signed a restructuring deal that will see De Beers take full ownership of the Gahcho Kué diamond mine in Canada's Northwest Territories.

Under the agreement, De Beers will acquire the 49 per cent stake held by Mountain Province's wholly owned subsidiary, 2435386 Ontario Inc, in exchange for settling the company's remaining reclamation payments and all outstanding debts owed to De Beers.

Once completed, De Beers will own 100 per cent of the Gahcho Kué mine, and Mountain Province and its subsidiaries will be released from all liabilities associated with the joint venture, including debt, accrued interest, guarantees and obligations under related payment, security and credit-support agreements.

The deal follows a sharp decline in diamond prices over the past year, which Mountain Province attributed primarily to tariff uncertainty and conflict in the Middle East.

"This agreement follows an extensive review of the alternatives available to the company against the backdrop of a material decline in diamond prices over the past year," said Jonathan Comerford, president and CEO of Mountain Province. "It provides the most credible path to protect stakeholder value in the current circumstances."

It also allows Mountain Province's subsidiary to repurchase its former interest from De Beers before December 31, 2029, with the purchase price equivalent to the share of decommissioning costs attributable to that interest. The subsidiary also retains rights of first offer and first refusal should De Beers decide to sell the mine or its mineral rights.

Separately, Mountain Province's noteholders and lender Dunebridge Worldwide Ltd have agreed to a six-month suspension of interest and principal repayments. The standstill period will allow the company to restructure its balance sheet and seek new funding to support potential future participation in Gahcho Kué and continued development of its Kennady Diamonds assets.

Challenging market conditions alongside falling diamond prices heavily impacted Mountain Province's finances. Fiscal year 2025 revenues reached US$111.5 million, down from US$195.2 million in 2024 as per-carat prices dropped 18.06 per cent year on year.

In the second quarter of 2026, Mountain Province posted a net loss of US$84 million compared with a net loss of US$26.4 million in Q2 2025. While the company sold 869,520 carats for US$31.2 million in Q2 this year compared with 411,114 carats for US$26.6 million in Q2 the year prior, average per-carat prices dropped to US$36 from US$65.