Detour Gold updates West Detour project development plan

30 January 2017 (Last Updated January 30th, 2017 18:30)

Detour Gold Corporation has announced that due to current uncertainties associated with the approval process for the West Detour project, it is no longer certain that permits required will be secured in time to start mining in January 2018.

Detour Gold Corporation has announced that due to current uncertainties associated with the approval process for the West Detour project, it is no longer certain that permits required will be secured in time to start mining in January 2018.

As a result, the firm is preparing an alternative mine plan and will file a new life of mine (LOM) plan and associated technical report under National Instrument 43-101 before the end of March 2017.

Detour has filed an environmental study report (ESR) with provincial authorities. However, the company was recently notified by one of its aboriginal partners that it had made a request for a federal environmental assessment process.

The company stated that although the company believes that the ESR meets both provincial and federal environmental standards, the provincial process usually takes one year compared with two to three years for the federal process.

Detour Gold president and CEO Paul Martin said: "Although we are disappointed with the permitting delay for West Detour, having the benefit of a large reserve base allows us to manage this schedule change. The company is currently in discussions with the federal authorities and looks forward to concluding this matter shortly."

The ESR was filed with the Ministry of Natural Resources and Forestry (MNRF) under the Ontario Environmental Assessment Act for a Class 'C' Environmental Assessment for Resource Stewardship and Facility Development Projects.

"Annual mining rates are expected to ramp-up to around 120 million tonnes in 2017."

In addition, the ESR was distributed to both provincial and federal ministries and impacted aboriginal communities for their review and comment.

The company stated that it has yet to obtain support of all aboriginal partners. It filed the ESR to spur the commencement of the environmental assessment process.

Detour stated that it will continue to engage with all of its aboriginal partners throughout the environmental assessment process.

The company has reworked its mine plan to determine the optimal timing to start West Detour.

Under the currently developed base case plan, mining of the West Detour pit will not begin before 2021 in relation to the timing of a federal process, while including flexibility for a quicker provincial process by offering an option to begin the adjacent north satellite pit in 2019.

In both cases, annual mining rates in 2017 are expected to ramp-up to around 120 million tonnes from 100 million tonnes.

Currently, there is no change to the preliminary gold production guidance of 600,000oz to 670,000oz for 2018.

Production of gold is expected to be lower in 2019 and 2020 than in the prior LOM plan due to delay of West Detour.