detour-lake-mine-recent-development

Recent Developments

Recent Developments (Updated July 29, 2015)

Q2 2015 Summary

Detour Gold reported 2015 second quarter results on July 29, 2015. 

View the related press release:
15 07 29 - Detour Gold Reports Second Quarter 2015 Results

 

Detour Lake Mine - Q2 2015 Operational Results

  • Gold production totaled 105,572 ounces, approximately 4% below the lower end of the guidance range for the first quarter of 2015.

  • Mill facility processed a record 5.2 million tonnes (Mt) of ore or an average of 57,015 tonnes per day (tpd) at recoveries of 91%. Processed grade was 0.82 grams per tonne (g/t).

  • Mill operating time at 88% was in line with projections with a four day planned shutdown in June to replace SAG and ball mill liners on both lines, complete further improvements on the 410 conveyor system, and conduct a number of annual inspections which included the thickeners. 

  • Milling rates attained 2,712 tonnes per operating hour (tpoh) for the second quarter, exceeding the budget rate of 2,600 tpoh and the design rate of 2,500 tpoh. The processing plant has now been operating at design capacity of 55,000 tpd since March 2015.

  • A total of 25.5 Mt (ore and waste) was mined in the second quarter (equivalent to mining rates of 280,000 tpd for Phase 1 and 2), approximately 18% higher than the annual budgeted rate of 238,000 tpd and above the fourth quarter target of 268,000 tpd.

  • Phase 2 pre-stripping totaled 1.4 Mt for the quarter.

  • At the end of the quarter, run-of-mine stockpiles had been successfully re-built to 1.7 Mt grading 0.71 g/t, providing operational flexibility for the second half of 2015.

  • Total cash costs for the second quarter of 2015 were US$734 per ounce sold1 and all-in sustaining costs were US$1,030 per ounce sold1, lower than plan due to higher production and a favorable exchange rate.

  • Lower unit costs were achieved in the second quarter, mainly due to more tonnes mined and milled. In addition, plant operating costs benefited from consumables (i.e. grinding media, cyanide, and SO2) declining to their lowest levels since production commenced.


Detour Lake Mine Operation Statistics:


Q2 2015 Q1 2015 Q4 2014 Q3 2014 Q2 2014
Ore mined (Mt)             6.37 3.82 4.30 4.20      2.89
Waste mined (Mt) 19.08 15.97 15.39 14.71 16.11
Total mined (Mt)2 25.45 19.79 19.69 18.91 19.00
Strip ratio (waste:ore)             3.0 4.2 3.6 3.5 5.6
Mining rate (tpd)2 280,000 220,000 214,000 206,000 209,000




Ore milled (Mt)             5.19 4.30 4.71 4.53 4.42
Head grade (g/t Au) 0.82 0.84 0.85 0.88 0.91
Recovery (%) 91 91 91 90 91
Mill throughput (tpd)             57,015 47,797 51,142 49,186 48,569
Mill availability (%) 88 78 83 81 83
Ounces produced1 (oz) 125,348 105,572 116,770 115,344 117,366
Ounces sold (oz) 123,296 104,497 124,913 106,334 107,206
           
 Average realized price1,3 (US$/oz) $1,215 $1,232 $1,240 $1,275 $1,294 
 Total cash cost per oz sold1,4 (US$/oz) $734 $939 $886 $955 $954 
 AISC per oz sold1,4,5 (US$/oz) $1,030 $1,321 -
           
 Mining (Cdn$/t mined) $2.42 $3.16  $3.22 $2.98 $2.87
 Milling (Cdn$/t milled) $8.81 $11.78  $10.17 $10.09 $11.67
 G&A (Cdn$/t milled)6 $2.72 $3.89  $3.30 $3.25 $3.46

Note: mill availability is defined as mill operating time.


Outlook


Detour Gold confirms its 2015 guidance as follows:
2015 Guidance
Gold production (oz) 475,000-525,000
Total cash costs ($/oz sold)2 US$780-$850
All-in sustaining costs ($/oz sold)2 US$1,050-$1,150
Sustaining capital expendituresUS$90-$100 M
Capitalized stripping costsUS$20-25 M

For the remainder of 2015, the Company is targeting mining rates ranging between 250,000 and 290,000 tpd. Mine development will be focusing on opening the eastern part of the pit, delivering material to the tailings area using the mine haulage fleet, and maximizing feed grade by further reducing mining dilution. Access to the higher grade ore is now anticipated to start in the third quarter versus the fourth quarter and as a result approximately 10,000 to 15,000 ounces from the fourth quarter production is targeted to be processed in the third quarter.

Exploration expenditures for 2015 have increased to approximately $8 million with this summer 30,000 metre drilling program at Lower Detour.

The LOM plan update is expected to be completed at the end of 2015 and will be released along with the 2016 guidance.

The following price and cost assumptions were used to forecast the 2015 guidance: gold price of US$1,200/oz, diesel fuel price of US$0.82 per litre, power cost of US$0.04 per kilowatt hour, and exchange rate of $1.00US:$1.15Cdn.

Lower Detour Drilling Program

The Company started its 30,000 metre drilling program at the end of June. To date, 7,200 metres in 20 holes have been completed on the Lower Detour target, located 6 to 7 kilometres south of the Detour Lake processing plant. The majority of the holes have encountered visible gold in the targeted mineralized zones. Assay results are pending.

Notes:
1 Refer to the section on Non-IFRS Financial Performance Measures in the MD&A for the relevant periods.
2 For Q2 2015, total mined and mining rate include both Phase 1 and 2.
3 Commencing in 2015, the Company has adjusted the definition of realized gold price to include the impacts of realized gains and losses on gold derivative instruments. Prior periods have been adjusted.
4 The calculation of this non-IFRS measure, including prior periods, was adjusted to allocate the electricity adjustment into the appropriate historical period to which the cost applied. Refer to the Non-IFRS Financial Performance Measures in the MD&A for Q2 2015.
5 For AISC, the Company adopted this measure effective January 1, 2015.
6 G&A costs include site G&A, infrastructure, environmental and Aboriginal costs.

Technical Information
The scientific and technical content of this news release has been reviewed, verified and approved by Drew Anwyll, P.Eng., Senior Vice President Technical Services, a Qualified Person as defined by Canadian Securities Administrators National Instrument 43-101 “Standards of Disclosure for Mineral Projects”.

Non-IFRS Financial Performance Measures
The Company has included non-IFRS measures in this website page. The Company believes that this measure, in addition to conventional measures prepared in accordance with IFRS, provide investors an improved ability to evaluate the underlying performance of the Company. The non-IFRS measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. These measures do not have any standardized meaning prescribed under IFRS, and therefore may not be comparable to other issuers. Refer to the Company's MD&A for the relevant periods for further details.

NI 43-101 Disclosure:
On February 4, 2014, Detour Gold announced an updated mine production plan for the Detour Lake project. The NI 43-101 compliant Technical Report for this update was filed on SEDAR on February 4, 2014. The following QPs participated in this update:  BBA Inc., under the direction of André Allaire, Eng., Acting President and CEO and Patrice Live, Eng., Director Mining; SGS Canada Inc., under the direction of Yann Camus, Eng., Project Engineer and Maxime Dupéré, P.Geo., Senior Geologist; and AMEC Environment & Infrastructure, a Division of AMEC Americas Limited, David G. Ritchie M.Eng., P.Eng, Senior Associate Geotechnical Engineer and Geotechnical Engineering Group Manager.

 

Downloads