1. 1|
BMO Capital Markets 26th Global Metals & Mining Conference
Hollywood, FL – February 26 - March 1, 2017
CANADA’S
INTERMEDIATE
GOLD PRODUCER
2. 2|
Forward Looking Information
This presentation contains certain forward-looking information and forward-looking statements, as defined in applicable securities laws (collectively referred to herein as “forward-looking
statements”). Forward-looking statements relate to future events or future performance and reflect current expectations or beliefs regarding future events and include, but are not limited to,
statements with respect to: (i) the amount of mineral resources and mineral reserves and exploration targets; (ii) the amount of future production over any period; (iii) net present value and
internal rates of return of mining operations; (iv) assumptions relating to recovered grade, average ore recovery, internal dilution, mining dilution and other mining parameters set out in the
technical reports, studies and disclosure of the Company; (v) assumptions relating to revenues, operating cash flow and other revenue metrics set out in the Company’s disclosure materials (vi)
mine expansion potential and expected mine life; (vii) expected time frames for completion of permitting and regulatory approvals; (viii) future capital and operating expenditures; (ix) future
exploration plans; (x) future gold prices; and (xi) sources of and anticipated financing requirements. All statements other than statements of historical fact are forward-looking statements. Often,
but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “continues”, “forecasts”, “projects”,
“predicts”, “intends”, “anticipates”, “targets”, or “believes”, or variations of, or the negatives of, such words and phrases or state that certain actions, events or results “may”, “could”, “would”,
“should”, “might” or “will” be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause actual results to differ
materially from those anticipated in such forward-looking statements. The forward-looking statements in this presentation speak only as of the date of this presentation or as of the date or dates
specified in such statements.
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, the ability of the Company to refinance its convertible notes and credit facility on or before maturity (November 30, 2017 and August
31, 2017, respectively) on acceptable terms, gold price volatility, changes in debt and equity markets, a reduction in the company’s available cash resources, the uncertainties involved in
interpreting geological data, risks relating to variations in recovered grades and mining dilution, variations in rates of recovery, changes or delays in mining development and exploration plans,
the success of mining, development and exploration plans, changes in project parameters, risks related to the receipt of regulatory approvals, increases in costs, environmental compliance and
changes in environmental legislation and regulation, delays in the consultation and permitting process for West Detour, 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
2015 AIF and in the continuous disclosure documents filed by Detour Gold on and available on SEDAR at www.sedar.com.
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: a constant gold price
of $1,200/oz in 2017, a constant CAD/US exchange rate of 1.30 in 2017, a constant diesel fuel price of C$0.70/L in 2017, and a constant power cost of C$0.30/kWhr in 2017, the ability of the
Company to refinance its convertible notes and credit facility on or before maturity (November 30, 2017 and August 31, 2017, respectively) on acceptable terms, the availability of financing for
exploration and development activities; operating and capital costs; the Company’s available cash resources in 2017; the Company's ability to attract and retain skilled staff; the mine
development schedule and related costs; the mine production schedule; dilution control, sensitivity to metal prices and other sensitivities; the supply and demand for, and the level and volatility of
the price of, gold; timing of the receipt of regulatory and governmental approvals for development projects and other operations; the timing and results of consultations with the Company’s
Aboriginal partners, the supply and availability of consumables and services; the exchange rates of the Canadian dollar to the U.S. dollar; energy and fuel costs; required capital investments;
estimates of net present value and internal rate of returns, the accuracy of reserve and resource estimates, production estimates and capital and operating cost estimates and the assumptions
on which such estimates are based; 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.
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.
3. 3|
Notes to Investors
The scientific and technical content of this presentation was reviewed, verified and approved by Drew Anwyll, P.Eng., Senior Vice President Technical Services,
a Qualified Person as defined by Canadian Securities Administrators National Instrument 43-101 “Standards of Disclosure for Mineral Projects”.
Qualified Persons
Non-IFRS Financial Performance Measures
The Company has included non-IFRS measures in this presentation: total cash costs and all-in sustaining costs,. The Company believes that these measures, in
addition to conventional measures prepared in accordance with IFRS, provide investors an improved ability to evaluate the underlying performance of the
Company. The non-IFRS measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS. These measures do not have any standardized meaning prescribed under IFRS, and therefore may not be
comparable to other issuers. Other companies may calculate these measure differently.
Detour Gold reports total cash costs on a sales basis. Total cash costs include production costs such as mining, processing, refining and site administration,
agreements with Aboriginal communities, less non-cash share-based compensation and net of silver sales divided by gold ounces sold to arrive at total cash
costs per gold ounce sold. The measure also includes other mine related costs incurred such as mine standby costs and current inventory write downs.
Production costs are exclusive of depreciation and depletion. Production costs include the costs associated with providing the royalty in kind ounces.
The Company believes the measure all-in sustaining costs more fully defines the total costs associated with producing gold. The Company calculates all-in
sustaining costs as the sum of total cash costs (as described above), share-based compensation, corporate general and administrative expense, exploration and
evaluation expenses that are sustaining in nature, reclamation cost accretion, sustaining capital including deferred stripping, and realized gains and losses on
hedges due to operating and capital costs, all divided by the gold ounces sold to arrive at a per ounce figure.
Costs excluded from all-in sustaining costs are non-sustaining capital expenditures and exploration costs that are expected to materially increase production,
financing costs and tax expense. Consequently, this measure is not representative of all of the Company’s cash expenditures. In addition, the calculation of all-in
sustaining costs does not include depreciation and depletion expense as it does not reflect the impact of expenditures incurred in prior periods.
All monetary amounts are in U.S. dollars unless otherwise stated.
4. 4|
Unmatched combination of long
life and large production profile
Competitive cost profile
relative to industry peers
Production growth
Strong exploration potential
Top-ranked jurisdiction
| 4
DGC Investment Thesis
5. 5|
#1 Large Scale/Long Life Mine
100% OWNERSHIP IN QUALITY ASSET
2015/16YE Reserves (M oz) 2017 Production Guidance (K oz)
AEM/YRI
Canadian
Malartic
G
Eleonore
AEM
LaRonde
G
Red Lake
16.4
7.7
4.6
3.1
2.0
AEM/YRI
Canadian
Malartic
G
Eleonore
AEM
LaRonde
G
Red Lake
600550-
600
315 300315
DGC
Detour
Lake
DGC
Detour
Lake
6. 6|
Since 2012 total exploration
budgets have been cut by
50%
Too few large discoveries to
sustain current production
rates
Current timelines to
production are much longer
(permitting, project size, and
complexity)
Source: RBC Capital Markets
0
5
10
15
20
2008 2009 2010 2011 2012 2013 2014 2015 2016E
Reserve life (yrs)
Producing Gold Companies
Long Life Assets on the Decline
Insufficient spending to replace reserves causing reserve life to
fall from 18 yrs in 2010 to 13 yrs in 2016
Current Status of the Gold Industry
7. 7|
OPERATIONS GROWTH BALANCE SHEET
Mine and mill
optimization
Organic growth
valuation
Debt
re-financing
Realize on
economies
of scale
Add value with: Maintain
capital
discipline
Satellite deposit
development
Early-stage
project
acquisition
Shareholder
returns
DGC Strategic Focus
232
457
506 538 550-
600
600-
670
2013 2014 2015 2016 2017E 2018E
Gold Production (K oz)
8. 8|
Balance Sheet Management
Repaid $142 M in 2016
At year-end 2016
Net cash = $129 M
Net debt = $272 M
Not highly leveraged
Net debt/EBITDA 2016 = ~1.3:1
Preferred re-financing alternatives
for the Notes (due November 2017):
Bank syndicate (currently 5 bankers)
Equipment provider
Non-covenant driven debt
9. 9|
Finishing 2016 on a Positive Note
Gold production of 537,765 oz; Q4 gold
production 143,512 ounces
Estimated AISC1 of $1,005/oz sold; Q4
AISC1 of $1,124/oz sold
Debt reduction of $142 million
Year-end cash and short-term
investments balance of ~$129 M
Positive drilling results from Zone 58N
$1,056 $1,005
$200
$600
$1,000
0
100
200
300
400
500
232
Detour Lake Mine
■ AISC ($/oz sold)1
■ Gold Production (K oz)
2015 2016
506 538
2016 Highlights
1. Refer to the section on Non-IFRS Performance Measures on slide 3 of this presentation. Subject to year-end closing.
10. 10|
2016 Operating Results
total mined87.4 MT
2.9 strip ratio
MT
ore milled
0.90 G/T AU
head grade
%
recovery
20.8
89
Throughput rate at 56,792 tpd
Record mill performance
Head grade and recovery
below plan for the year
Processed 0.7 Mt of fines (<2”);
65% grade improvement
Mining rates of 239,000 tpd
Below projections for the year;
9 Mt behind mine plan
Campbell pit recovery plan on
schedule
Addition of a CAT6060 shovel
and haul trucks for 2017
7.0 stockpiles
MT
g/t Au@ 0.65
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2016 Capital Costs
Sustaining capital ~$100 M
Include Q4 capital purchases of $16 M
originally planned in 2017-18 (i.e. 3 haul
trucks and first payment on a new camp)
Capitalized stripping ~3 M
Non-sustaining expenditures ~2 M
Q4'16 2016Q4’16
AISC 1($/oz sold)
$1,124
$1,005
2016
1. Refer to the section on Non-IFRS Performance Measures on slide 3 of this presentation. Subject to year-end closing.
12. 12|
2017 Guidance
550-600 THOUSAND
oz gold
$690-750 TCC
per oz sold
1
$1,025-1,125
All-in sustaining costs
AISC
per oz sold
1
fifth year
of operation
2017
Estimated production
Estimated costs
Total cash costs
Key Assumptions
Gold price of $1,200/oz, diesel fuel price of C$0.70 per litre; power
cost of C$0.03/kWh; and CAD/US FX rate of 1.30.
1. Refer to the section on Non-IFRS Performance Measures on slide 3 of this presentation.
13. 13|
2017 Operating Plan
1 MINE: 100 Mt
2 MILL: 21-22 Mt
Mining rate increase in Q2 with
additional shovel, 4 haul trucks,
and ROM fleet (total fleet: 6
shovels & 32 haul trucks)
Campbell pit mining to Bench
148
Strip ratio at 3.6:1
Head grades improving after
Q1
Recovery improvement after
Q2 with lead nitrate/oxygen
control system
No processing of fines
Higher Gold Production After Q1
14. 14|
2017 Expenditures
Mine
$78 M
TMA
$40 M
Other*
$31 M
Mill
$6 M
2017 Budget
Sustaining Capital $155 M
Capitalized Stripping $14 M
Development (West Detour) $5 M
Total Capital Expenditures $160-180 M
Corporate G&A $21 M
Share-based Compensation $11 M
Exploration $6 M
Sustaining capex include: $40 M for mining equipment, $30 M of
accelerated capital mainly for TMA Cell #2 ($9 M) and new camp ($17 M)
~$23 M of these expenses to be paid in 2018
~65% of costs in Cdn$
14
1. Refer to the section on Non-IFRS Performance Measures on slide 3 of this presentation.
15. 15|
Organic Growth Pipeline
WEST DETOUR
DEVELOPMENT
1 ZONE 58N
LOWER DETOUR
2
Provincial ESR filed;
Request from FN for
Federal EA process
LOM plan being
revised for optimal
timing of West
Detour to reflect
Federal EA
Reserves: 1.5 M oz
Evaluating options for
mining widths and cut-off
grade for different UG
mining scenarios
Infill drilling program
between 250-450 m
Potential for high-
grade UG mine
| 15
3
BURNT BUSH
CLAIM BLOCK
New claim block
staked 70 km
south of Detour
Lake
Airborne
geophysics
planned for H2’17
16. 16|
West Detour Development
Permitting Update
Water management and increased footprint required additional
permitting approvals
Provincial Environmental Study Report (ESR) filed on Jan. 30,
2017 to trigger Provincial Environmental Assessment (EA)
process
One Aboriginal partner has requested Federal EA process
› Awaiting response from Canadian Environmental
Assessment Agency (CEAA)
Company believes ESR meets both Provincial and Federal
requirements
1
Provincial or Federal EA – We are ready to go
17. 17|
West Detour Development1
Revising Life of Mine Plan
Optionality in LOM plan based on timing of receiving permits
› West Detour pit not before 2021
› North satellite pit in 2019: scheduling flexibility with a
contractor (less implementation time)
In both cases, annual mining rate ramp up to 120 Mt
No change to prelim. guidance of 600,000-670,000 oz in 2018
Lower gold production projected in 2019-2020
Capital and operating costs to be updated
New LOM Plan and Technical Report prior to March 31, 2017
18. 18|
Exploration Program - Zone 58N
2017 Drilling Program Underway
30,000 m of infill drilling between
250-450 m below surface
Selective holes deeper to
delineate continuity
450m
2
Preliminary Model and Conceptual Design
Model assumes 3 metre min. horizontal thickness
Evaluation underway for potential wider mining areas
Conceptual UG advanced exploration program prepared;
cost estimated at C$30-50 M over 5 years
Advanced exploration permit required for
for U/G access
21. 21|
Total Recordable Injury
Frequency Rate (TRIFR)1
Safety Performance
1. TRIFR: Total recordable injuries x 200,000 hours divided by total man
hours worked.
2016 Achievements:
Established leading indicators for
Managers
Partnered with Dupont Safety Systems
Improved Visible Felt Leadership
methodology
2017 Plans:
Roadmap and actions for our
5-Year Safety Journey
Detailing procedural and cultural
improvements
2.5
2.3
1.7
0.0
0.5
1.0
1.5
2.0
2.5
2014 2015 2016
23. 23|
Year-end 2015 Reserves & Resources
Notes:
1. Mineral resources and reserves were
completed by Detour Gold in conformity
with generally accepted definitions and
guidelines given in the Canadian Institute
of Mining, Metallurgy and Petroleum (CIM)
Standards on Mineral Resources and
Mineral Reserves as required by NI 43-
101.
2. Mineral reserves were estimated using a
gold price of $1,000/oz and mineral
resources were estimated using a gold
price of $1,200/oz at a US$/C$ exchange
rate of 1.10.
3. Mineral reserves and resources were
based on a cut-off grade of 0.50 g/t Au.
4. Mineral reserves included an average
mining dilution of 5.3% from 2016 to 2018
and 4% for 2018+, at a diluting grade of
0.20g/t Au. Mining ore loss of 5% also
included.
5. Only Probable LG Fines scheduled in the
mine plan were reported as mineral
reserves. The LG fines reserves were
based on a cut-off grade of 0.40 g/t Au.
6. Mineral resources are reported exclusive
of mineral reserves. Mineral resources
that are not mineral reserves do not have
demonstrated economic viability.
7. Totals may not add due to rounding.
At Dec. 31, 2015
Reserves
Tonnes
(millions)
Grade
(g/t Au)
Contained
Gold Ounces
(000’s oz)
Detour Lake Mine Proven 89.2 1.26 3,603
Probable 351.6 0.95 10,779
Stockpiles 4.8 0.64 98
Total P&P 445.5 1.01 14,480
West Detour Proven 1.8 0.99 56
Probable 47.0 0.97 1,473
Total P&P 48.8 0.98 1,529
LG Fines Probable 20.0 0.60 386
Total P&P 514.3 0.99 16,395
Resources
Detour Lake Mine Measured 17.4 1.33 746
Indicated 66.2 1.00 2,125
M+I 83.6 1.07 2,871
West Detour Measured 0.4 0.85 10
Indicated 36.5 0.86 1,005
M+I 36.9 0.86 1,015
Total M+I 120.5 1.00 3,886
Detour Lake Mine Inferred 33.7 0.81 875
West Detour Inferred 8.6 0.89 246
Total Inferred 42.3 0.82 1,121
24. 24|
1. Conversion price for the Notes is $38.50.
Shareholder Information
>80% INSTITUTIONS TOTAL
4.9 M Share options
9.3 M Convertible notes 1
188.8 M FULLY DILUTED
174.6 M Issued & outstanding
Share Structure (03/31/2014) Top Shareholders
12%
~$129MILLION
cash and short-term investments at December 31, 2016
Share Structure (December 31, 2016) Top Shareholders
BlackRock
7% Van Eck Associates
4% Fidelity
25. 25|
Initiating
Research
Firm Analyst Target Price at
February 15, 2017
14.02.06 Cormark Securities Richard Gray/Tyron Breytenbach $32.00
07.06.11 Haywood Kerry Smith $32.00
09.06.17 Laurentian UNDER REVIEW $30.00
07.07.09 Paradigm Don Blyth/Don MacLean $27.50
14.06.17 Eight Capital Research Josh Wolfson $27.00
08.01.14 Canaccord Rahul Paul $26.50
13.11.12 Beacon Securities Michael Curran $25.00
07.12.20 Macquarie Mike Siperco $25.00
07.11.26 National Bank Steve Parsons $25.00
08.07.14 TD Dan Earle $25.00
14.04.22 Goldman Sachs Andrew Quail $24.00
13.04.16 Scotiabank Trevor Turnbull $24.00
13.12.09 GMP Securities Ian Parkinson $23.25
16.06.06 Bank of America Merrill Lynch Michael Jalonen $23.00
08.11.06 BMO Brian Quast $23.00
08.09.04 RBC Dan Rollins $23.00
13.08.14 Desjardins Michael Parkin $21.50
10.05.19 CIBC World Markets Cosmos Chiu $21.00
10.07.22 Credit Suisse Anita Soni $21.00
16.10.18 Global Mining Research David Radclyffe/David Cotterell $18.00
07.08.07 Raymond James UNDER REVIEW
Average target C$24.84
Analyst Coverage (21)
26. 26|
Paul Martin
President and CEO
Pierre Beaudoin
COO
James Mavor
CFO
Julie Galloway
General Counsel &
Corporate Secretary
Drew Anwyll
Sr VP Technical Services
Derek Teevan
Sr VP Corporate &
Aboriginal Affairs
Charles Hennessey
Mine General Manager
Laurie Gaborit
VP Investor Relations
Jean-François Métail
VP Mineral Resource
Management
Ruben Wallin
VP Environment & Sustainability
Alberto Heredia
Controller
Jacques McMullen
Corporate Technical Advisor
Lisa Colnett
Edward C. Dowling
Robert E. Doyle
Paul Martin
Alex G. Morrison
Jonathan Rubenstein
André Falzon
Ingrid Hibbard
Michael Kenyon
Management & Directors
MANAGEMENT
DIRECTORS
27. 27|
Laurie Gaborit
VP Investor Relations
Email: lgaborit@detourgold.com
Phone: 416.304.0581
Paul Martin
President and Chief Executive Officer
Email: pmartin@detourgold.com
Phone: 416.304.0800
www.detourgold.com
Contact Information
