August 2012

Measure twice, build once

Detour Gold takes the cautious route to mine development

By Dan Zlotnikov

When Detour Gold’s Detour Lake project comes online in the first quarter of next year, the operation is expected to process 55,000 tonnes of low-grade ore per day and turn out an average of 650,000 ounces of gold every year of its 20-year life.

Pierre Beaudoin, Detour Gold’s senior vice-president of capital projects, is mindful that the industry has seen projects fail to meet predicted results in the past. Many have ended up having to add equipment or make other costly changes before projects could reach nameplate throughputs. These harrowing tales have taught Detour’s team some invaluable lessons and made them extra cautious in the design of this new mine.

According to Beaudoin, not all mining companies are risk-averse enough when they approach feasibility studies. While large companies can sometimes get away with slow ramp-ups, single-asset juniors like Detour cannot afford the same luxuries. That is why Beaudoin and his team opted for two separate process streams instead of going with one large SAG mill, and why they delayed delivering BBA’s feasibility study results by three months to conduct third-party reviews.

Delays are better at early stages

Delaying a new project is never a popular decision, but the payback can be worth it if it is done in the early stages. Beaudoin says an independent review of the feasibility study was standard procedure at Barrick Gold, where he had spent 16 years prior to joining Detour Gold in early 2010. “We wanted to make sure that our consultants removed the maximum amount of risk possible from the project, and it was the reviewers' job to cross-check that,” he explains.

Some sort of audit of a feasibility study is almost a given, says André Allaire, vice-president of markets, mining and metals at BBA. But, he notes, those reviews are usually done by investors. Allaire points out that with BBA’s studies posted on SEDAR or their clients’ websites as part of NI 43-101 compliance, new investors will frequently audit the technical work. Clients like Detour Gold do not frequently request audits.

“As it happens, it was very beneficial, and we certainly support Detour’s aversion to risk,” Allaire says. “We got audited by different specialists. These people are very knowledgeable, so it gives rise to good discussions and further improvement for the design. It builds confidence, both for the client and the consultant.”

In all, Detour brought in eight world-class experts in their respective fields: comminution, metallurgy, block modelling, open pit mining, capital cost estimation, pit slope, tailings design and water management. They were each assigned a part of the study and, for the most part, Beaudoin told them: “You have two months, please find holes in it.”

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