Dunebridge is controlled by Dermot Desmond, who also owns about 32% of Mountain Province. Mountain Province has 49% of Gahcho Kue in a joint venture with De Beers Canada.

Diamond producers are being forced to find alternative sales routes for stores of rough stones as the world's traditional markets remain disrupted by COVID-19 restrictions.

Mountain Province expects the sale of the first tranche - $22 million worth of diamonds from Gahcho Kue inventories - to close this week, providing much-needed liquidity.

The company said the transaction covered run-of-mine stones below 10.8 carats. It would retain about 50% of the value when the gems were sold to third parties.

A board committee unanimously approved the sales deal after considering alternatives, and financing options. The company completed two diamond sales this year before having to cancel a third.

BMO Capital Markets analyst Edward Sterck said the company's balance sheet was "manageable" short term, with about $16 million in interest payments to come in the June and September quarters.

At the end of the March quarter, Mountain Province had $32 million cash. During April, it drew down $25 million from a revolving credit facility.

Shares in the company traded at C38c on Monday, capitalising it at $80 million (US$60 million).