Burgundy secures fuel offtake deal to ease seasonal cash flow
ASX-listed Burgundy Diamond Mines has secured a fuel offtake agreement with Macquarie Bank, a deal designed to smooth out seasonal cash flow challenges at its Ekati diamond mine in Canada’s remote Arctic.
Under the agreement, Macquarie will own and supply diesel stored in Ekati’s fuel tanks, providing Burgundy with a working capital boost of about $45-million in the first quarter of 2025. The deal is structured to be replicable in future years, potentially evolving into a multi-year arrangement.
Due to its isolated location, Ekati relies on a yearly resupply campaign via the Tibbitt to Contwoyto winter road, which operates for about eight weeks each year. This results in a concentrated cash outflow over a short period, creating working capital pressures.
Burgundy CEO Kim Truter described the agreement as an innovative approach that allowed the company to spread fuel costs over the full year rather than a single quarter.
"This promising strategy offers potential to become an annual process for Burgundy and is structured with potential for it to be a multi-year agreement," he said.
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