Agnico Eagle is spending a combined US$300 million on two exciting gold projects in northeastern Ontario to lengthen its life in the Abitibi gold belt.
Heading into the next decade, the Toronto gold company has plans to build two underground mines by expanding its Detour Lake mine, northeast of Cochrane, and develop its Upper Beaver Project, north of Larder Lake.
To Agnico, both Detour and Upper Beaver are considered low-cost, long-life projects with solid returns and blue sky potential.
In June, Agnico provided more details on the underground opportunity at its Detour pit where there’s a push on to make that operation a one-million-ounce-per-year producer.
In releasing its second-quarter 2024 financials and operating performance in July 31, Agnico revealed its next steps on delivering Upper Beaver, one of the projects it’s been grooming in the Kirkland Lake mining camp.
When it comes to decision-making at Agnico, it’s all about taking a “steady and disciplined approach” on investing. In attempting to eliminate all risks when it comes to mine-building, Agnico is spending US$100 million at Detour and $200 million at Upper Beaver over the next three years on advanced underground exploration.
At Detour, an exploration ramp will be driven down two kilometres to collect a bulk sample and do some infill and expansion of an identified underground mineral resource.
For Upper Beaver, both a ramp and exploration shaft will be developed down 250 metres and 760 metres, respectively, to carve out underground drill platforms and collect bulk samples.
Agnico believes it can put Upper Beaver into production as early as 2030. The deposit has the potential to average 210,000 ounces of gold a year along with 3,600 tonnes of copper over a 13-year mine life.
“This is a measured and responsible approach,” said Agnico Eagle president-CEO Ammar Al-Joundi in a conference call last week.
“These are great projects with great economics, with tremendous upside to expand and extend mine lives. They are straight down the fairway of what we do and what we’ve done. These are not new projects in countries we’ve never been to before; they are in our backyard and we’ve done our homework. We have the people, the skills, the resources to take these projects prudently to the next level.”
Chief operating officer Natasha Vaz called Upper Beaver “another low-risk opportunity to grow the production profile in a camp that we know pretty well."
Upper Beaver is located relatively close to Agnico's processing plants at Macassa in Kirkland Lake and in LaRonde, Que. The company is weighing options on whether to build a standalone mill at Upper Beaver or consider transporting the ore to an existing plant.
Exploration vice-president Guy Gosselin said a considerable amount drilling of the deposit has been done since a pre-feasibility study on Upper Beaver was posted in 2017. The geological modelling and interpretation of the ore body has been “completely refreshed” showing 3.4 million ounces of indicated resources and 400,000 ounces in the inferred category.
Vaz and Gosselin said heading underground at Upper Beaver allows them to unlock the full gold potential on some nearby satellite deposits, Upper Canada and Anoki-McBean, in the camp.
