The Gold Report
Notable Quotes
"ICG has closed a CA$2.5M flow-through placement." (12/24/15) Integra Gold Corp. - Thibaut Lepouttre, Caesars Report More >
"The exploration upside at MAG's Juanicipio project is substantial." (12/23/15) MAG Silver Corp. - Gwen Preston, Resource Maven More >
"AKG's management continues to deliver on its development milestones." (12/22/15) Asanko Gold Inc. - Nana Sangmuah, Clarus Securities More >
"We are initiating coverage on KDX with a Buy rating." (12/21/15) Klondex Mines Ltd. - Don Blyth, Paradigm Capital More >
"VIT's Eagle is a shovel-ready, fully permitted, prefinanced gold project." (12/17/15) Victoria Gold Corp. - Tom Hayes, Edison Investment Research More >
DGC Increases P&P Reserves by 31%
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KERRY SMITH, Haywood Securities
(02/11/2011)
"Reserves Keep on Growing: Detour has released an updated reserve and resource estimate for its wholly owned Detour Lake gold project in NE Ontario. The estimate was based on the 100,000m drilled in 2010, using the same assumptions and parameters as the June 2010 feasibility study (gold price: US$850/oz. and a cutoff grade of 0.5 g/t). Detour reported an impressive 14.9 Moz. of proven and probable gold reserves (just under our current modeled estimate of 15.0 Moz.), which represents a 31% increase over the feasibility study reserve estimate. Total resources increased 22%, to 25.7 Moz. from 21.1 Moz. Reserve gold grade increased slightly to 1.03 g/t gold from 1.02 g/t gold, while the stripping ratio increased to 3.9:1 from 3.3:1 by assuming all in-pit inferred resources are waste—a conservative assumption. Additional drilling will convert most of this inferred into reserves over time. At a cutoff grade of 0.3 g/t gold, in-pit inferred resources increase to 36.7 Mt. from 14.2 Mt. using a cutoff grade of 0.5 g/t. Based on the new reserves, mine life at Detour Lake increases to 21 years from 16 years. We currently model mineable reserves of 15.0 Moz., including 1.5 Moz. of low-grade stockpiles. For 2011, Detour plans to spend CAD$14M on its exploration program and will target five areas, including 50,000m on the western extension of the current ultimate open-pit design, which should add a further 1–1.5 Moz. gold (Haywood estimate). . .Our $43.25 target price is based on 1.4x our after-tax project NAVs% of US$2,213M, or CAD$25.05/share, plus corporate adjustments and an exploration credit, on a fully project-financed basis assuming a long-term gold price of US$1,050/oz. We continue to recommend the shares of Detour Gold with a SECTOR OUTPERFORM rating." |
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