detour gold dec 2009 presentation

8/14/2019 Detour Gold Dec 2009 Presentation

1/38

DevelopingDetour Lake -

The largest goldreservein Canada

Scotia Capital Inc. Precious Metals ConferenceDecember 1-2, 2009


2/38


3/38


4/38

Share StructureShare Structure

Shares Outstanding 69.13 M

Options DGC 3.43 M

Options PDX 0.48 M

Fully Diluted 73.04 M

ar e cap (Nov. 27): . onMajor Shareholders (FD basis):

Paulson & Co. 14%

Passport Capital 5%Detour Gold Mgmt. 70%

Well financed with C$324 M cash and no debt4


5/38

Randgold

Agnico-Eagle

Lihir

500%

400%

300%

200%

Return($US)

Royal Gold

Source: Tocqueville April 2009 Presentation

DGC11/09DGC11/09

Share Issuance vs PerformanceShare Issuance vs Performance

Performance as of Nov. 27, 2009:

374% return since IPO (Jan 31, 2007)

DGC07/09DGC07/09

Kinross100%

0%

-100%

To

tal

0% 100% 200% 300%Percentage Change in Shares Outstanding**

Newcrest

Coeur dAlene

Freeport McMoran

Golden Star

Harmony

AngloGold

Barrick

Spot Gold

XAUIvanhoe

Newmont

Gold FieldsSilver Standard

Notes: Total return in $US from April 2004 - March 2009, including any dividends paid.

Percentage Change in Shares Outstanding from March 2004 - March 2009.

In the case of Randgold and Compania de Buenaventura, the shares were adjusted to reflect a stock split.

BuenaventuraPan American Silver

5

DGC01/07DGC01/07


6/38

Detour Lake A World Class AssetDetour Lake A World Class Asset

Positive pre-feasibility study:

Open pit reserves of 8.8 M oz @ US$775/oz

Global resources (M+I) of 17.3 M oz 14.5 yrs mine life at 45,000 tpd

mill throughput

Annual gold production of560,000 oz at cash cost ofUS$404/oz

At US$900/oz:

pre-tax NPV @ 5% discountof US$1.2 billion generatingIRR of 20.1%

6


7/38


6.3

5.0

inCanada

8.8

Largest undeveloped reserve in Canada

Ranking 6th in North America

7

4.0 3.62.8

2.3 2.01.6 1.4 1.3

Source: BMO Nesbitt Burns August 2009.

GoldReserve

s

(Mo

z)


8/38

Detour Lake discovery of a worldclass, large scale, OP deposit

Global mineral resources:M+I =17.3 M oz; Inferred = 5.2 M oz

Excellent potential to further

22.4

13.2


Gold price8

Sept 09DGC drilling(249,000m)

US$775

June 08DGC drilling(123,000m)

US$700

7.8

Dec. 07DGC drilling(50,000m)

US$575

3.4

Sept. 06DGC duediligence

US$450

1.7

May 05Estimatedby Pelangio

US$425

InferredM&I

(in millions oz)

Resources/Reserves

P&P

8.88.8


9/38

Detour Lake

Gravel (34 km)

185 km by road toproject site (last 34 kmgravel)

230 kV powerline fromFraserdale to site


Paved road (151 km)

Tailing facility with1-2 yr capacity

Air strip on site

Exploration campfacilities for 60

9


10/38

Over 265 km2


Focus of 2007-09 drillingFocus of 2007-09 drilling

10


11/38

Pre-feasibility Results

Mineral Reserves and Mine Plan

11


12/38

Tailingsdam

Airstrip

Old Pit

Detour Lake Pre-FeasibilityDetour Lake Pre-Feasibility

Assumptions

Gold price (US$/oz) (1) 775

Foreign exchange rate (Cdn$/US$) 1.18

Fuel price (US$/litre) 0.66Income/mining tax rate (%) 27/10

Net Smelter Return (%) 2

Mine Parameters

West Pitarea

Calcite Zonearea

Ore milled (Mt) 238.6

Waste mined (Mt) 907.9

Strip ratio (waste:ore) 3.8:1

Average gold grade (g/t) 1.15

Total contained gold (M oz) 8.81

Estimated gold recovery (%) 91.5

Total recovered gold (M oz) 8.05

Mine life (years) 14.5

Average annual gold production (oz) 560,000

(1) Approximates the 3-year trailing average

12


13/38

Detour Lake Mineral ReservesDetour Lake Mineral Reserves

Open Pit Mineral Reserves at US$775/oz(cut-off grade of 0.6 g/t)

ReserveCategory

Tonnes(millions)

Grade(g/t Au)

Gold Ounces(000s)

Proven 61.2 1.40 2,751

13

1. After a 95% mining recovery rate.2. The block model applied a mining dilution factor of 13.5% to the resulting ore tonnages.

ro a e . . ,

Total (P&P) 238.6 1.15 8,813


14/38

Detour Lake Block ModelDetour Lake Block Model

US$775 reserve pit

14

>1.0 g/t Au

0.5 - 1.0 g/t Au


15/38

Phase 2

Detour Lake Engineered Pit DesignDetour Lake Engineered Pit Design

Phase 1

Development strategy: High grade ore in years 1 and 2, stockpile (0.6-0.8 g/t) Development of Phase 2 by year 3 to smooth strip ratio

15


16/38

Detour Lake Mine PlansDetour Lake Mine Plans

0.4-0.6 g/t Au 0.6-1.5 g/t Au >1.5 g/t Au

16Surface approx. 6270 m


17/38

Detour Lake Mine PlansDetour Lake Mine Plans

0.4-0.6 g/t Au 0.6-1.5 g/t Au >1.5 g/t Au

17Surface approx. 6270 m


18/38


Infrastructure

18


19/38

Mining Lease

TailingsFacilityTailingsFacility

Mine RockStockpileMine RockStockpileCampCamp

OverburdenStockpile

OverburdenStockpile

Proposed Site PlanProposed Site Plan

Open Pit(US$775/oz) Plant Site

FacilityPlant SiteFacility

Mine RockStockpileMine RockStockpile

19


20/38

TailingsPipelines

Pre-DetoxThickener

LeachingTanks

Pre-LeachThickener

CyanideDestructionTanks

Substation

Sag Mills

Stockpile

Ball Mills

Assay

Laboratory

Small footprint: 1 km2

92% availability

Twin lines:1 SAG (36) and1 ball mill (26)

Plant Design 45,000 tpdPlant Design 45,000 tpd

Feed Conveyor

GyratoryCrusher

PebbleCrusher

Crushed OreStockpile

20

Grinding to K80 of 75 m

Gravity recovery 30-50%

Low cyanide consumption

~0.5 kg/t with 0.05 kg/tLead Nitrate

Leach retention time of 28 hrs

Overall gold recovery: 91.5% at 1.15 g/t head grade20


21/38

Simplified Process FlowsheetSimplified Process Flowsheet

21


22/38

Stage 1Stage 2Stage 7Stage 8 - Final Existing 1 yr capacity

Downstream

construction Capacity of 270 MT

Space available for

Tailings Development PlanTailings Development Plan

22

expans on


23/38

Project Construction ScheduleProject Construction Schedule

Feasibility study

Optimization

Feasibility study

Optimization

2H2009 2010 2011 2012

Permitting

Eng.& Procurement

ConstructionProduction

Permitting

Eng.& Procurement

ConstructionProduction

23

Note: Subject to permitting and financing.

Plant commissioning projected in 4Q 2012 23


24/38


Project Economics

24


25/38

Summary Economic AnalysisSummary Economic Analysis

Base case assumptions

Gold - US$775/oz

F/X $Cdn/$US = 1.18

Diesel US$0.66/litre

Power Cdn$0.051/kwh (excl. line losses)

ssumes purc ase o o corp or n m on

At US$775/oz, pre-tax NPV 5% US$621 million, IRR 13.5%,6.2 yr payback

At US$900/oz, pre-tax NPV 5% US$1.2 billion, IRR 20.1%,

4.0 yr payback Average annual gold production of 560,000 oz

Average LOM operating cash costs of US$404/oz

25


26/38

Estimate 25% (US$ M)

Description Pre-productionCapital

SustainingCapital

Mining 109 173

Process Plant 402 20

Tailin s and Water Mana ement 19 147

Capital ExpendituresCapital Expenditures

Infrastructure and Services 51

Powerline and Main Sub-station 76

Other Indirect 72

EPCM 42Contingency (10%) 75 36

Mine Closure 41

Total 844 417

26


27/38

Cash Operating ExpensesCash Operating Expenses

US$/tmilled

US$/tmined

US$/oz

Average mining costs 6.18 1.29 183

Processing cost 6.26 -- 185

General and administration 1.22 -- 36

as opera n cos s . --

Royalty (2%) -- -- 16

Total operating costs (LOM) -- -- 420

27


28/38

Gold Production ProfileGold Production Profile

$400

$500

$600

500

600

700

800

ction

)

ingCost

z)

560,000 oz Average Annual Production US$404/oz Average Operating Cash Cost

$0

$100

$200

$300

0

100

200

300400

Gold

Pro

du

(000

o

Cash

Ope

rat

(US

$o

28

Payback

@ US$775/oz

@ US$900/oz 4 yrs

6 yrs


29/38

Gold Price(US$/oz)

US$650 US$775/oz US$900

NPV @ 5% (US$ M) 55 621 1,187

Discount rate Undiscounted 2.5% 5.0% 7.5% 10.0%

NPV pre-tax ($ M) 1,596 1,014 621 353 169

Financial Analysis - SensitivitiesFinancial Analysis - Sensitivities

. . .

Capex change +10% -10%

NPV @ 5% (US$ M) 519 621 723

IRR (%) 11.7 13.5 15.8

Operating costchange

+10% -10%

NPV @ 5% (US$ M) 435 621 807

IRR (%) 11.2 13.5 15.8

29


30/38

Sensitivity GraphSensitivity Graph

800

1,000

1,200

1,400

(US$M)

30

-200

0

200

400

-20% -10% 0% 10% 20%

NPV5

%

Revenue Operating Costs Capital Costs

+ +


31/38

OpportunitiesOpportunities

Project financing with vendors

Converting resources to reserves with additionaldrilling

Optimizing mill throughput:

Increase yearly revenues, reduce operating costs

31

Capex/opex savings vs. permitting risk

Stockpiling and processing low-grade material


32/38

50% TWD/50% DGC 100% DGC

Reserves

Resource StopeStope

Exploration PotentialExploration PotentialDetour Lake Global Mineral Resource EstimateDetour Lake Global Mineral Resource Estimate(

Exploration Potential

high-grade

Ind. 1.2 M ozUS$700/oz

P&P 8.8 M ozUS$775/oz

100% DGC

50% DGC

32

QK Zone

Holes drilled post June 1, 2009 cut-off date

Tonnes

(millions)

Grade Capped

(g/t Au)

Gold Ounces

(000s)Measured (M) 102.1 1.48 4,846

Indicated (I) 343.8 1.12 12,417

Total (M&I) 445.9 1.20 17,263

Inferred 151.4 1.07 5,189

1. Measured and indicated resources are inclusive of proven and probable reserves.

2. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

Detour Lake Global Mineral Resource Estimate(cut-off grade of 0.6 g/t)


33/38

Comparable Large-Scale OP Projects in CanadaComparable Large-Scale OP Projects in Canada

150

200250

300

150

89

AMC/Total Reserves (US$/oz)1

agle

Feasibility CompletedFinanced

Pre-feasibilityCompleted

278

1. Data revised as of Nov. 27 (closing DGC $16.60).2. Take over by Agnico-Eagle at approx. US$125/oz on a resource base (announced Feb. 2007).

3. Assumes financed 60% debt /40% equity (assuming 80 M shares outstanding).

050

Cumberland Osisko Detour Gold

Agnic

o-

E

ReservesP&P 3.0 M oz 6.3 M oz 8.8 M oz

33

.11 oz/share (3).02 oz/shareGold oz/share

(2)


34/38

Upcoming MilestonesUpcoming Milestones

Q4 - 2009 Completion of 80,000 m of additional drilling to be included in

Feasibility Study

First half 2010 Mill throughput optimization based on coarser grind (75 to 105

microns)

Feasibility Study including bank review

Long lead time mill procurement finalized

Finalize construction approach (EPCM) and owners team

2010 Power line permit completion

Completion of First Nations IBAs

Vendor-supplier financing negotiations

34


35/38

Additional Information

35

Gerald Panneton, President & CEOEmail: [email protected]

Ph: 416 304 0800

Laurie Gaborit, Director Investor Relations

Email: [email protected]: 416 304 0800

www.detour old.com

Detour Gold Corp., Royal Bank Plaza, North Tower

200 Bay Street, Suite 2040, Box 23, Toronto, ON, M5J 2J1


36/38

DGC=Detour Lake + 50% Block ADGC=Detour Lake + 50% Block A

Ind = 1.2 M ozInf = 0.3 M oz Feasibility stageFeasibility stage

AdvancedExploration

Stage

AdvancedExploration

Stage

US$700 Pit

US$775 Pit

Historic DDH

DHs in June 08 resource

DHs post-resource(results announced)

36

P&P= 8.8 M oz


37/38

Management & DirectorsManagement & Directors

Management

Gerald Panneton, President, CEO & Director

Michael Kenyon, Chairman (formerly CEO of Canico and Sutton)

Paul Martin, CFO

Pat Donovan, Vice President Corporate Development

Derek Teevan, Vice President Aboriginal & Government Affairs

Paul Chawrun, Director Technical Services

aur e a or , rec or nves or e a ons

Denis Caron, Mine Manager

Bob Jankovic, Chief Geologist

Directors

Michael Kenyon Andr Gaumond

Peter Crossgrove Ingrid Hibbard

Gerald Panneton Phil Olson

Louis Dionne Jonathan Rubenstein

Ron Thiessen

37


38/38

Analyst Coverage (13)Analyst Coverage (13)InitiatingCoverage

Firm Analyst Target

07.06.11 Haywood Kerry Smith $18.00

07.07.09 Paradigm Don Blyth/Don MacLean $18.75

07.08.07 Raymond James Brad Humphrey $18.75

07.11.26 Wellington West Steve Parsons $20.00

07.12.03 Thomas Weisel Andrew Mikitchook $10.00*

07.12.20 Macquarie Pierre Vaillancourt $15.00

08.01.14 Canaccord Steven Butler $19.50

08.07.14 TD Dan Earle $20.00

08.09.04 RBC Michael Curran $19.00

08.11.06 BMO NB John Hayes Outperform

09.02.25 Fraser Mackenzie Gary Baschuk $16.50

09.06.01 Sandfire Catherine Gignac $17.00

09.06.17 Laurentian Eric Lemieux $16.50

38* Target not revised since pre-feasibility results

detour gold dec 2009 presentation

Documents