CANADA S NEXT INTERMEDIATE GOLD PRODUCER

Transcription

1 CANADA S NEXT INTERMEDIATE GOLD PRODUCER 1

2 Forward Looking Information This presentation contains certain forward-looking information as defined in applicable securities laws (referred to herein as forward-looking statements ). Specifically, this presentation contains forward-looking statements regarding commissioning of the second production line, securing a $90 million credit facility, commencement of commercial production, completing a prefeasibility study on Block A, reserve and resource estimates, ore grade, expected mine life, anticipated gold production, gold recovery, cash operating costs and other costs, capital costs, sensitivity to metal prices and other sensitivities, ramp-up of operations, future operating plans, potential expansion opportunities, and plans for organic growth. 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 Business - Risk Factors in Detour Gold s 2011 AIF and in the continuous disclosure documents filed by Detour Gold on and available on SEDAR at 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. 2

3 NI Disclosure Information Containing Estimates of Mineral Reserves and Resources The mineral reserve and resource estimates reported in this presentation were prepared in accordance with Canadian National Instrument Standards of Disclosure for Mineral Projects ( NI ), as required by Canadian securities regulatory authorities. For United States reporting purposes, the United States Securities and Exchange Commission ( SEC ) applies different standards in order to classify mineralization as a reserve. In particular, while the terms measured, indicated and inferred mineral resources are required pursuant to NI , the SEC does not recognize such terms. Canadian standards differ significantly from the requirements of the SEC. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories constitute or will ever be converted into reserves. In addition, inferred mineral resources have a great amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian securities laws, issuers must not make any disclosure of results of an economic analysis that includes inferred mineral resources, except in rare cases. On September 4, 2012, Detour Gold announced an updated mine production plan for the Detour Lake project. The NI compliant Technical Report for this update was filed on SEDAR on October 18, The following QPs participated in this update: BBA Inc., under the direction of André Allaire, Eng., Vice-President, Markets Mining and Metals and Patrice Live, Eng., Mining Manager; SGS Canada Inc., under the direction of Michel Dagbert, Eng., Senior Geostatistician 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. 3

4 Invest in Detour Gold Our Vision Focus and Discipline Leverage to gold price Optimize operation Organic growth Safe jurisdiction Per Share Value Creation Free cash flow growth Limit share dilution Return on capital 4

5 Company Profile TSX:DGC SNAPSHOT Market cap: $2.3 B Cash position: $236 M 2012 Share liquidity: 507,448 avg volume/day Closing price (02/20/2013): $19.16 SHAREHOLDERS: Institutional 80% / Retail 20% Paulson & Co. 15% CONVERTIBLE NOTES 13.0 M OPTIONS & FN SHARE COMMITMENTS 8.8 M FULLY DILUTED M ISSUED AND OUTSTANDING 117.9M Carmignac Gestion 5% Detour Gold Mgmt <2% Note: Cash position at December 31, 2012 and share data at January 31,

6 Focused on One Core Asset Detour Lake - Ontario, Canada Low-risk, mining friendly jurisdiction Large prospective land package of 566 km 2 on Abitibi Greenstone Belt In production: Detour Lake open pit mine 15.6 M oz in reserves In progress: Block A prefeasibility study Exploration: Targeting high-grade mineralization 6

7 From Core to Pour Record Timing from Discovery to Production Detour Lake in 6 years PRODUCTION 2013 ACQUISITION /DISCOVERY PRE-FEASIBILITY STUDY FEASIBILITY STUDY & PERMITTING DEVELOPMENT PRODUCTION 7

8 Detour Lake Mine in 6 Years Consistently Delivered Results Focused on execution Built strong management team with track record of success Increased resource growth by 750% since acquisition at <$5/oz Completed positive economic studies over a 2-year period Raised over $2 billion while limiting share dilution Completed mine construction within time frame (27 months) Obtained strong community and Aboriginal support 8

9 2013 Objectives H First gold pour in February Commissioning of second production line Securing $90 million credit facility 20,000 m drilling program targeting high-grade gold mineralization H Achieving commercial production Gold production target of +350,000 ounces for the year Completing pre-feasibility study on Block A Advancing evaluation of mine expansion scenarios Year-end mineral resources/reserves update 9

10 Corporate Responsibility Focus on health and safety of our employees, the well-being of our community and the protection of the natural environment Hiring in the region, giving priority to local Aboriginal communities: 95% of workforce from region 25% are Aboriginals Scholarship and job training Supporting local communities Business opportunities Participation in municipal development Corporate philanthropy WORKFORCE ORIGIN COCHRANE AREA 26% NORTHERN ONTARIO 43% COCHRANE 25% REST OF ONTARIO 3% OTHER 2% 10

11 Detour Lake Mine Production Start 02/ 2013 OP reserves (M oz) 15.6 Mill throughput (tpd) 55,000 Strip ratio (waste:ore) 3.7 Gold recoveries 91% Average grade (g/t) 1.03 Estimated mine life (yrs) 21.5 Avg. production (oz/yr) 657,000 Initial capex (C$ B) 1.5 Sustaining capex (C$ B)

12 Projected LOM Operating Costs Breakdown of TCC Mining costs Processing cost G&A Cash operating costs Royalty (2%) and other Refining Silver credit (0.20) -- (7) Total cash costs (TCC) A 10% change in: Diesel or power costs = $9/oz change in TCC Cdn$ FX rate = $63/oz in TCC MAINTENANCE 22% LABOUR 18% CONSUMABLES 29% POWER 12% DIESEL G&A 8% 5% ROYALTY+ OTHER (2% NSR) 6% 12

13 2013 Guidance Total production: 350,000 oz to 400,000 oz of gold Post commercial production (Q3): Total cash costs of C$800/oz to C $900/oz based on 200,000 oz to 250,000 oz sold Sustaining capital: C$180 M (< $80 M in H1) Commercial production target in Q3 NOTE: Commercial production to be declared after 60 consecutive days of operating at >75% of throughput (55,000 tpd x 75% = 41,250 tpd) 13

14 2013 Ramp Up Mining Current stockpile of g/t) Mining rates to ~200,000 tpd by year-end Mining fleet of 20 haul trucks & 4 shovels Processing Plant 55,000 tpd conventional gravity and CIP processing plant with two production lines Line 1 in operation Line 2 start-up in March 2013 Optimize and improve efficiencies 14

15 Mining Production Satellite image dated July

16 Organic Growth Opportunities Development Grow reserve base to +20 M oz Complete Block A pre-feasibility study in 2013 Evaluate Detour Lake expansion Exploration Large prospective land position of 566 km 2 Test gold targets on structure south of Detour Lake: 20,000 m in H1 30M oz 20M oz 10M oz Inferred M&I P&P

17 Development Block A Block A Pre-feasibility Block A pre-feasibility study by year-end 2013 Evaluate potential expansion options *TWD Technical Report dated July

18 Exploration South Structure 15.6 M oz in Reserves 20,000 m in H Existing DDH Gold occurrence (OGS) DDH intersection >1g/2m DDH intersection >1g/10m *Note: Excludes drilling around Detour Lake and M zone (Block A). 18

19 Invest in Detour Gold Our Vision Focus and Discipline Leverage to gold price Optimize operation Organic growth Safe jurisdiction Per Share Value Creation Free cash flow growth Limit share dilution Return on capital 19

20 ADDITIONAL INFORMATION 20

21 Current Valuation vs. Peers Consensus P/NAV (1) EV / Reserves (1)(2) Share of Au Reserves per $1000 (1)(3) Source: Bloomberg, company filings, select Street Research Note: Market data updated to February 14, Alamos shown pro-forma Aurizon acquisition announced January 14, Shown based on gold only reserves on an attributable basis. 3. Calculated as US$1,000 divided by fully diluted market capitalization multiplied by total attributable gold only reserves. 21

22 Detour Lake Profile Detour Lake Sept Mine Plan (3) 22 Gold price (US$/oz) (1) 1,200 Foreign exchange rate (US$/Cdn$) 1.00 Assumptions Fuel price (US$/barrel) 100 Income/mining tax rate (%) 25/10 Net Smelter Royalty (%) 2 Ore milled (Mt) Waste mined (Mt) (4) 1,734 Mine Strip ratio (waste:ore) 3.7 Parameters Avg. gold grade (g/t) 1.03 Total contained gold (M oz) 15.6 Estimated gold recovery (%) 91.0 Total recovered gold (M oz) 14.1 Mine life (years) 21.5 Avg. annual gold production (oz) 657, US$1,600/oz for 2013, US$1,500/oz for 2014, and US$1,400/oz for Press release Jan. 31, 2011 with Technical Report dated Mar. 15, Press release Sept. 4, 2012 with Technical Report dated Oct. 18, Includes low-grade stockpile. 700 m 16,500E Open 0.5 g/t cut-off 20,600E 1.0 g/t Au g/t Au <0.5 g/t Au

23 Gold Production/Cost/Grade Profile Gold Production ( 000 oz) 800 Avg. C$749/oz Avg. 657,000 oz/yr Grade (g/t Au) Total Cash Costs (C$/oz) Note: Excludes stripping adjustments. 23

24 Detour Lake Reserves & Resources As at December 31, 2011 Reserves (1) Proven ,222 Probable ,351 P&P ,573 Resources (2) Measured ,424 Indicated ,836 M&I ,261 Inferred , After a 95% mining recovery rate; Mining dilution factor of 15.5%. 2. Inclusive of mineral reserves. 24

25 Detour Lake & Block A Block A near-surface resource 2012 DH 2012 extension DH DH included in 2011 year-end reserves DH not included in 2011 year-end reserves Historical DH Detour Lake 2011 year-end reserves = 15.6 M oz 25

26 Analyst Coverage Updated February 20, 2013 Firm Analyst Bank of America Merrill Lynch Mike Parkin BMO NB John Hayes Canaccord Steven Butler CIBC Barry Cooper Credit Suisse Anita Soni Haywood Kerry Smith Laurentian Eric Lemieux Macquarie Mike Siperco National Bank Steve Parsons Paradigm Don Blyth/Don MacLean Raymond James Brad Humphrey RBC Dan Rollins TD Dan Earle 26

27 Management & Directors Management Gerald Panneton Founder, President & CEO Director Michael Kenyon Executive Chairman Paul Martin CFO Pierre Beaudoin Sr VP Capital Projects Julie Galloway Sr VP General Counsel & Corporate Secretary Derek Teevan Sr VP External & Aboriginal Affairs Pat Donovan VP Corporate Development James Mavor VP Finance Rachel Pineault VP HR & Northern Affairs James Robertson VP Environment & Sustainability Eric Josipovic Controller Drew Anwyll Director of Operations Andrew Croal Director Technical Services Laurie Gaborit Director Investor Relations Jean-Francois Metail Director Reserves and Resources Greg Miazga Director Construction & Engineering Bill Snelling Director Corporate Systems & Controls Christian Brousseau Project Manager Patrik Gillerstedt Mine Manager Directors Peter Crossgrove Louis Dionne Robert E. Doyle Ingrid Hibbard Michael Kenyon Alex G. Morrison Gerald Panneton Jonathan Rubenstein Graham Wozniak 27

28 Contact Information Gerald Panneton President & CEO Phone: Laurie Gaborit Director Investor Relations Phone: