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MiN i N g Detour Gold preparing for gold production by Daina Lawrence The Toronto-based junior miner, Detour Gold Corp. [DGC-TSX], is getting ready to go into production at its open-pit gold mine in northeast Ontario in 2013. More than 90% of the construction is complete at the site, which is expected to be Canada's largest gold mine. Investors and analyst are keeping a close watch as high gold prices and low production costs are expected to produce big profits for the company. Though the project is expected to come online early next year, the company is aiming its production levels high. "Based on a production startup of January 2013 and assuming commercial production is achieved in July, the mine is expected to produce up to 400,000 ounces of gold in 2013," Gerald Panneton, President and CEO of Detour Gold, said. "Over the first three years of operation, including 2013, we estimate the project to generate over a $1 billion of operational cash flow," according to Panneton. "With average annual gold production projected at 657,000 ounces, the Detour Lake Mine will be among the largest gold operations in North America." The project's current mine life is 21.5 years and Detour is currently finishing its feasibility study regarding the project's potential to be developed into a bulk mining open pit operation. Based on current gold prices, of more than US $1,700 per ounce, the prediction is that Detour will make about $2 billion before taxes in its first five years of operation. As of press time, the company has a market capitalization of about $3 billion. Panneton bought the more than 540 km2 property from Pelangio for $75 million back in 2006; Detour Gold went public in 2007. The project has big potential and its mine life could go beyond those allotted two decades as growth plans are definitely on the books, explains the company's director of Investor Relations, Laurie Gaborit. "We are also looking at a mine expansion at Detour Lake as the deposit is open to the west. We could increase the throughput of the mill above the current 55,000 tonnes per day (tpd). Scenarios at 75,000 tpd and 90,000 tpd are being looked at," she says. "It is early, but the future looks good if gold prices stay at those levels," she says, referring to the current gold prices of well over US $1,700 per ounce. "Also, we are stockpiling material between 0.3 and 0.5 g/t gold (about 3 million oz total), which will likely be processed at the end of the mine life. Right now this is accounted as waste," says Gaborit. The location of the project is also a great advantage to the Detour Lake Project, explains Gaborit, because it's made it easier to keep the cost down. This 100%-owned project is about 2.5 hours outside the small town of Cochrane. And although it is isolated and Detour was required to build a full camp onsite, there is easy access to roadways for trucks, hydropower available and a qualified workforce with over 98% of Detour's workers coming from the north. According to the company, proven and probable reserves for the Detour Lake Construction is nearly completed at Detour gold's open pit gold mining project in northeast ontario. photo courtesy Detour gold Corp. 40 www.resourceworld.com NOVEMBER 2012