TORONTO, ONTARIO--(Marketwire - Nov. 8, 2012) - Detour Gold Corporation (DGC.TO) ("Detour Gold" or the "Company") is pleased to report that the mining and construction progress of its 100% owned Detour Lake open pit gold mine in northeastern Ontario is proceeding on schedule with first gold pour expected in January 2013. Mill commissioning activities for the first production line are underway and it is expected that the first ore will be fed through the mill circuit before year-end.
Detour Lake Development Highlights:
- Gold production to start in January 2013
- Project construction reached 95% completion mark at end of October
- Mill commissioning of first production line commenced in October
- Average mining rates above 100,000 tpd during September and October
- Ore stockpile totalled 1.1 million tonnes at end of October
- Operational team now at 396 employees, ahead of schedule
Gerald Panneton, President and CEO of Detour Gold commented, "We are nearly finished with construction and I am proud of what our team has accomplished in just 24 months. The energy at site is vibrant and I would like to thank all our employees and contractors for their dedication and excellent work. We are now confident we will see the first ore in the mill circuit before year-end, almost two months ahead of the original schedule. The first gold pour is expected to occur in January 2013 and will mark a new chapter in Detour Gold's successful history as it transitions from a developer to producer and becomes the next mid-tier gold producer in Canada."
Detour Lake Construction 95% Complete and Plant Commissioning Starting
Construction progress is at the 95% completion mark at the end of October 2012 and the Detour Lake mining operation is approximately two months away from its first gold production. At the processing plant, the mechanical work is 98% complete, which has permitted commissioning activities to commence. Mechanical alignment of the SAG and ball mill for the first grinding line is complete. Contractor manpower has begun to ramp-down and efforts are now focused on finishing the electrical and instrumentation work.
The first cell of the tailings management area (TMA) has reached the dam level required for the 2013 operation. Dewatering of the historic Campbell pit to the TMA is progressing as planned and will reach the targeted water level well in advance of operations. The water recovery system, the tailing lines and secondary containment systems are essentially complete.
Detour Gold's operation manpower is now at 396 employees with all senior operational management positions filled.
Pre-stripping and Mining Activities Reaches 20.3 Mt Mined
The production rates are steadily increasing and have now reached an average daily rate of more than 100,000 tpd over the last two months. As of the end of October 2012, the Company had mined over 20.3 million tonnes of material, with the majority relating to pre-stripping. Approximately 1.1 million tonnes of ore have been stockpiled for future processing, which is in line with the Company's plan of having 2.3 million tonnes of ore at an average grade of 0.81 g/t by year-end 2012.
For 2013, the Company's guidance remains unchanged:
- Gold production ranging between 350,000 and 400,000 ounces of gold
- Total cash costs of between $800/oz and $900/oz (to be reported after commercial production is declared)
Capital Costs Update
Pre-production capital costs are expected to finish within 3% of the project cost estimate of $1.45 billion, which dates from November 2011, one year ago. The increase is mainly associated with the acceleration of the schedule to process ore by year-end.
As of September 30, 2012, the Company had spent $1.19 billion and had approximately $348 million in cash and short-term investments, sufficient to fully finance the remaining project expenditures ($270 to $310 million). The Company expects to secure a letter of credit facility this month that will allow its letters of credit to be uncollateralized. It is also continuing to advance a senior secured credit facility to provide working capital required during the initial ramp-up period.
About Detour Gold
Detour Gold is an emerging mid-tier gold producer in Canada. Its development project, Detour Lake, is scheduled to start gold production in January 2013. The Detour Lake open pit mine is expected to produce an average of 657,000 ounces of gold annually over a period of 21.5 years. Detour Gold's shares trade on the Toronto Stock Exchange under the trading symbol DGC.
Scientific and technical information in this press release has been reviewed by André Allaire, an independent Qualified Person under National Instrument 43-101.
This press release contains certain forward-looking information as defined in applicable securities laws (referred to herein as "forward-looking statements"). Specifically, this press release contains forward-looking statements regarding the expected start of gold production in January 2013; the estimated pre-production capital costs and the sufficiency of funds to finance the remaining project expenditures; obtaining a letter of credit facility and a secured credit facility; the target of up to 2.3 million tonnes of ore available for processing prior to the commencement of operations; meeting its 2013 gold production guidance; producing an average of 657,000 ounces of gold annually for a period of 21.5 years. Forward-looking statements involve known and unknown risks, uncertainties and other factors which are beyond Detour Gold's ability to predict or control and may cause Detour Gold's actual results, performance or achievements to be materially different from any of its future results, performance or achievements expressed or implied by forward-looking statements. These risks, uncertainties and other factors include, but are not limited to, gold price volatility, changes in debt and equity markets, the uncertainties involved in interpreting geological data, increases in costs, environmental compliance and changes in environmental legislation and regulation, interest rate and exchange rate fluctuations, general economic conditions and other risks involved in the gold exploration and development industry, as well as those risk factors discussed in the section entitled "Description of the Business - Risk Factors" in Detour Gold's 2011 annual information form and in the continuous disclosure documents filed by Detour Gold on and available on SEDAR at www.sedar.com.
Such forward-looking statements are also based on a number of assumptions which may prove to be incorrect, including, but not limited to, assumptions about the following: the supply and demand for gold, and the level and volatility of the price of gold; the availability of financing for exploration and development activities; the estimated timeline for the development of the Detour Lake gold project; the expected mine life; anticipated gold production; gold recovery; the development schedule; cash operating costs and other costs; the financial analysis for the project; capital costs; sensitivity to metal prices and other sensitivities; the accuracy of reserve and resource estimates and the assumptions on which the reserve and resource estimates are based; the receipt of necessary permits; market competition; ongoing relations with employees and impacted communities; and general business and economic conditions. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements contained herein are made as of the date hereof, or such other date or dates specified in such statements. Detour Gold undertakes no obligation to update publicly or otherwise revise any forward-looking statements contained herein whether as a result of new information or future events or otherwise, except as may be required by law. If the Company does update one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements.