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DIGGERS & DEALERS PREVIEW

Kirkland detours Super Pit

by Mark Andrews

t is a safe bet that high acclaim will come for both Northern Detour Lake is the company’s second flagship asset in
IStar Resources Ltd and Saracen Mineral Holdings Ltd Ontario, Canada, and the current reserve base can sustain
at Diggers & Dealers, October 12-14 in Kalgoorlie, for a mine life of more than 20 years.
their acquisitions of equal stakes in KCGM and resultant In 2019, production from Detour Lake totalled 602,000oz @
ownership of the Super Pit. AISC of $US1,101/oz.
And applause may well be heard across the Pacific by an The addition of Detour Lake means Kirkland Lake is targeting
equally impressive company in a similar ilk. production of 1.35-1.4 moz gold at operating cash costs of
“We looked at that. In terms of value paid and the value that $US410-430/oz and AISC $US790-810/oz in 2020.
they see, we would have been just as happy to be a partner Detour Lake and Fosterville in Victoria (2019: 619,000oz
there as anyone of those two. The difference for us was @ $US291/oz) are somewhat benchmarks for acquisitions,
timing; as that was happening, we were having discussions while the low-cost nature of Macassa, Ontario, (2019:
around Detour Lake,” Kirkland Lake Gold Ltd president Tony 241,000oz @ $US695/oz) represents the business model
Makuch told GMJ about his company’s interest in the iconic Kirkland Lake is committed to.
Kalgoorlie asset.
“We have been pretty diligent from an M&A perspective and
“One deal would see us be a 50% operator and the other if we see another opportunity to be as transformational as
we could own 100% of and that is where the trade-off came. Fosterville has proven to be and we are in the process of
And it is their backyard, Detour Lake is in our backyard and proving Detour Lake to be, that is something we will look
there are certain times to stick closer to home when the at,” Kirkland Lake senior vice president of investor relations
opportunity arises.” Mark Utting told GMJ.
Shareholders were overwhelmingly supportive of Kirkland “When we took Fosterville from 150,000 ozpa gold to up over
Lake’s intention to buy Detour Gold Corp, with the implied 300,000 ozpa and obviously last year we did over 600,000oz
equity value at the time of $C4.9 billion. at such very low unit costs, it resulted in profitability and cash
The transaction for Detour Lake – one of the world’s largest flow that really are in a leadership position in the industry in
open pits – was completed in January at which point Kirkland terms of those metrics.”
Lake became the proud owner of a mine producing at rate Being a debt-free, cash generating machine ($US537 million
of about 600,000 ozpa gold and hosts reserves of 14.8 moz cash as at June 30) certainly positions Kirkland Lake to
@ 0.97 g/t. cherry pick a Fosterville or Detour Lake-replica from another

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