Canada-based diamond exploration company Stornoway Diamonds has temporarily ceased operations at its Renard mine in the James Bay region of north-central Québec.

The decision to place the Renard mine in a care and maintenance phase is effective immediately. The move is expected to preserve the assets at the mine and allow a rapid return to normal operations.

Stornoway said its long-term financial situation has been impacted by surging uncertainty around the diamond price in the short and medium term and a significant price drop of the resource on the world market.

In a press statement, Stornoway Diamonds said: “This was in part due to the halt in the import of rough diamonds to India and by the global geopolitical climate.”

Located in Nord-du-Québec, in the Cree territory of Eeyou Istchee, the Renard mine employs 500 people.

The mine started commercial production in 2017. It has an average production capacity of 1.6 million carats per year over an initial 14-year mine life.

Furthermore, Stornoway initiated process to place the business under the protection of the Companies' Creditors Arrangement Act.

The company expects to restructure its business and turn around its financial situation.

Deloitte Restructuring is expected to supervise the restructuring process and serve as monitor.

Stornoway added: “The company is implementing a process for soliciting investment and sale proposals under the Companies' Creditors Arrangement Act.”

Stornoway is owned by Osisko Gold Royalties and TF R&S Canada.