De Beers ends diamond exploration at site in northern Sask.

Mining company De Beers has abandoned its diamond exploration at the Western Athabasca Basin in Saskatchewan.

Earlier thisyear, De Beerssigned an agreement with CanAlaska a company that had staked claims on kimberlite-style targets at the basinin Saskatchewan's northwest.

• Diamond company De Beers keen on northwest Saskatchewan

Under that agreement, De Beers could have spentup to $20.4 million to develop the stake, which was estimated to cover some 17,400 hectares.

The work was to include air surveys and drilling of test samples.

However, the company said in a news release on Dec. 23 it had terminated the agreement with CanAlaska after testing at seven sites.

"Although the Western Athabasca Basin has the right geological and structural setting for the presence of diamondiferous kimberlite, De Beers decided not to continue drilling and, under the terms of the option agreement, have returned 100 per cent of the project to CanAlaska," the company said in a news release.

CanAlaska said the site still warrants exploration for diamonds.

"We will now concentrate on evaluating several of the more interesting magnetic anomalies within the remaining 78 targets that CanAlaska does not believe are related to magnetic organic material," said the company's president Peter Dasler.