Guess who currently owns the rights to the royalties? That's right, it's the federal government. They own the resources and the revenues. Apparently Paul Martin is dedicated to resolving the resource issue but nothing seems to have actually happened that makes me think anything will actually happen. It's like waiting for Godot, except in this case, everyone in the Northwest Territories is waiting for Martin to return the family jewels that he just happened to "borrow".
Right now the PM is involved in something that he calls, "Northern Strategy". It gives the three northern territories $40 million each for them to put in their pockets for them to use on a rainy day. First of all, what is $40 million going to buy you? That's penny candy money. It's apparently supposed to help the territories "buy stuff" along with transfer payments they receive annually. It looks more like Martin tried to buy off the territories using whatever he happened to have in his pocket. (This happened to include meter change, bellybutton lint and a piece of paper with the word Iqaluit on it).
This is directly from the Western Premier's Conference that took place in Kelowna, BC, 2003. This is one of their recommendations.
While that's a bit wordy, even the western premiers look like they support the transfer of natural resource control back to the territories.
But why wouldn't the government want to give control back to the Northwest Territories? They have a population of approximately 38 000 and every year they're given a transfer payment because they're deemed to be a "have-not" territory. If they were given back control of the diamonds mines, wouldn't the revenues be enough to make them a "have" province and therefore, the government would no longer have to make transfer payments to the territory? Sure the diamonds might be worth more than the transfer payments for one year but in the long run the diamonds aren't going to last forever and the Northwest sure isn't going anywhere.
What could they do with the royalties from the diamonds? Well, they might build some decent highways to replace the ones that seem to be crumbling due to increased traffic, mainly industrial traffic that I assume must be because of the diamonds. I did consider suggesting they build one of those large safes with a diving board like Scrooge McDuck but I think that diving into a pool of diamonds would be a one way trip.