Agnico-Eagle releases Detour Lake underground mine plan

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Agnico-Eagle Mines Ltd. (AEM-TSX, AEM-NYSE) has released a proposed underground mining plan for its Detour Lake gold mine in northeastern Ontario.

The company said the plan demonstrates strong returns and a pathway to transform Detour Lake into a one million ounce per-year gold producer.

Details of the plan have been announced after the company said it recently completed an updated mineral reserve and mineral resource estimate and an updated life of mine plan for Detour Lake. It also completed a preliminary economic assessment (PEA) which demonstrates that the underground project and the mill optimization (to 29 million tonnes per annum) have the potential to increase Detour Lake’s overall production to an average of about one million ounces per year over a 14-year period starting in 2030.

Agnico is a Canadian gold mining company with operations in Canada, Australia, Finland and Mexico.

Agnico acquired its 100% interest in the Detour Lake mine back in February, 2022, via a merger with Kirkland Lake Gold.

Detour Lake is the largest gold producing mine in Canada with large gold reserves of 19.9 million ounces. The mine is expected to produce 690,000 ounces of gold this year, up from 677,446 ounces in 2023.

The underground project is located on the west side of the open pit, within the Detour Lake mining permit. It will benefit from the existing infrastructure at the Detour Lake site, including tailings storage facilities area, processing plant and maintenance facilities.

“With the development of an underground mine to complement the existing open pit mine, we see the opportunity to transform the asset into one of the top five gold mines in the world by output,’’ said Agnico-Eagle President and CEO Ammar Al-Joundi.

“We have adopted a phased and disciplined approach to develop this potential, with the approval of a $100 million investment over the next three years to further study and de-risk the Underground Project, including the development of an exploration ramp and collection of a bulk sample,’’ he said.

The Underground Project provides earlier access to a high-grade core of mineralization at depth below the reserve pit through underground development and displaces lower grade open pit.

Life of mine payable gold production increases by 27% to 22 million ounces of gold in the 2024 PEA, including an increase of 0.7 million ounces of gold from the open pit and the addition of 4.0 million ounces from the underground project.

On Wednesday, Agnico shares eased 0.53% or 47 cents to $88.21. The shares trade in a 52-week range of $96.20 and $59.36.

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