Detour Gold starts mill commissioning and reaches 95% construction completion at Detour Lake
Friday, Nov 09, 2012Detour Gold Corporation (TSX:DGC) ("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.
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.
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.