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Gold production in Canada fell 22% in Q2 2020 due to pandemic-related suspensions

Commentaries & Views

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In Q2 2020, gold miners in Canada produced 1,160 koz of gold, or 22% less than in Q2 2019. Detour Lake was the largest gold mine in Canada while Moose River was the lowest cost gold operation measured by AISC.

Based on data collected from publicly released corporate reports, Canada produced 1,160 koz of yellow metal in Q2 2020 from primary gold mines and as a by-product of base metals and platinum group metals operations. This is significantly less (-22%) than 1,482 koz mined in Q2 2019. Production stoppages caused by COVID-19 related suspensions was the main contributing factor behind overall decline in gold output.

Production at Canada’s biggest Detour Lake gold mine in Ontario, owned by Kirkland Lake, totalled 132 koz and was 12% lower than in Q2 2019 mainly due to feeding lower grade stockpiled material to the mill during reduced operations.

Canadian Malartic mine in Quebec, jointly owned by Yamana and Agnico Eagle, was the second largest gold operation in Canada with 114 koz of gold produced in Q2 2020, a 33% decline compared to 169 kozt mined in Q2 2019. The Canadian Malartic mine entered care and maintenance on March 24, 2020, in response to government restrictions related to COVID-19 that required mining companies to minimize operational activities. Canadian Malartic resumed operations starting on April 15, 2020.

Pretium’s Brucejack mine in B.C. was third largest gold mine in Canada. Gold production totaled 90,419 ounces, and was similar to 2019, where the company produced 90,761 ounces of gold and 135,797 ounces of silver. COVID-19 did not directly affect second quarter gold production.

Gold production at fourth Canada’s biggest Newmont’s Porcupine gold mine, Ontario, increased by 64%, from 53 kozt in Q2 2019 (results have been included from the date of Porcupine acquisition by Newmont on April 18, 2019) to 87 kozt in Q2 2020. Gold output growth was primarily driven by higher ore grade mined from Borden, which achieved commercial production in the fourth quarter of 2019, and higher mill recovery from the lead nitrate circuit.

Agnico Eagle’s LaRonde mine complex in Quebec is fifth with 74 kozt of gold produced during Q2 2020. Gold production in the second quarter of 2020 decreased by 20% compared to the prior-year period primarily as a result of the suspension of operations in April, partially offset by higher grade related to positive grade reconciliation in stopes mined in the West mine area.

Only two operations (Porcupine, Moose River) out of the top 15 largest gold mines in Canada increased their gold output during Q2 2020.

With $649/oz AISC achieved in Q2 2020, St Barbara’s Moose River mine in Nova Scotia was the lowest cost gold mine in Canada. Moose River was followed by Alamos Gold’s Island Gold mine ($781/oz) in Ontario and Eldorado Gold’s Lamaque mine in Quebec ($796/oz).

The complete lists are below.

Top 15 largest gold mines in Canada.

Mine

Province / Territory

Major owner / operator

Q2 2020 Au output, koz

Q2 2019 Au output, koz

% change

1

Detour Lake

Ontario

Kirkland Lake

132

150

-12

2

Canadian Malartic

Quebec

Yamana/Agnico

114

169

-33

3

Brucejack

BC

Pretium

90

91

-1

4

Porcupine

Ontario

Newmont

87

53

64

5

LaRonde (incl. LZ5)

Quebec

Agnico Eagle

74

93

-20

6

Meliadine

Nunavut

Agnico Eagle

59

61

-3

7

Hemlo

Ontario

Barrick

54

55

-2

8

Rainy River

Ontario

New Gold

49

66

-26

9

Macassa

Ontario

Kirkland Lake

42

49

-15

10

Mount Milligan

BC

Centerra

36

49

-27

11

Timmins Mines

Ontario

Pan American

34

44

-22

12

Lamaque

Quebec

Eldorado Gold

33

33

0

13

Casa Berardi

Quebec

Hecla

31

31

-2

14

Moose River Consolidated

Nova Scotia

St Barbara

29

23

27

15

Hope Bay

Nunavut

TMAC

29

39

-25

Other mines

267

477

-44

Total

1,160

1,482

-22

Top 10 lowest cost gold mines in Canada measured by AISC.

Mine

Province / Territory

Major owner / operator

Q2 2020 AISC, $/oz

1

Moose River Consolidated

Nova Scotia

St Barbara

649

2

Island Gold

Ontario

Alamos Gold

781

3

Lamaque

Quebec

Eldorado Gold

796

4

Porcupine

Ontario

Newmont

800

5

Macassa

Ontario

Kirkland Lake

841

6

Eagle River

Ontario

Wesdome

879

7

New Afton

BC

New Gold

881

8

Brucejack

BC

Pretium

911

9

Canadian Malartic

Quebec

Yamana/Agnico

986

10

Hope Bay

Nunavut

TMAC

990

The following is more detailed information about top 15 largest gold mines in Canada.

1. Detour Lake, Ontario. 132 koz.

Detour Lake mine. Source: Detour Gold.

The Detour Lake open pit mine is located in northeastern Ontario, approximately 300 kilometres northeast of Timmins and 185 kilometres by road northeast of Cochrane, within the northernmost Abitibi Greenstone Belt. The operation is situated in the area of the historic Detour Lake open pit/underground mine operated by Placer Dome which produced 1.8 million ounces of gold from 1983 to 1999.

Detour Gold acquired the property in January 2007, completed a feasibility study in June 2010 and commenced gold production in February 2013. The Detour Lake operation has a mine life of approximately 22 years with an average gold production of 659,000 ounces per year, and includes the development of the West Detour project which is currently being permitted. Kirkland Lake Gold completed acquisition of Detour Gold on January 31, 2020.

2. Canadian Malartic, Quebec. 114 koz.

Canadian Malartic mine. Source: Agnico Eagle.

Canadian Malartic mine is located 25 km west of Val-d’Or, northwest Quebec. The large open-pit mine and plant built by Osisko Mining Corp. began commercial production in May 2011.

In June 2014, Agnico Eagle and Yamana Gold acquired Osisko and created the Canadian Malartic General Partnership that owns and operates the mine. Agnico Eagle and Yamana each have an indirect 50% ownership interest in the Partnership.

3. Brucejack, BC. 90 koz.

Brucejack mine. Source: Pretium.

The Brucejack Mine is a high-grade gold underground mine located in northwestern British Columbia, approximately 65 kilometers north of Stewart. A year-round, all-weather access road connects the mine to Highway 37. The mine’s operations and camps are fully grid-powered, with diesel backup available. The mine began commercial operation in July 2017.

4. Porcupine, Ontario. 87 koz.

Porcupine gold mine. Source: Goldcorp.

Newmont’s Porcupine Underground & Open-Pit Gold Mine located in and around the City of Timmins.

Porcupine district has produced more than 67 million ounces since 1910. Currently, approximately 60% of the gold comes from the Hoyle Pond underground mine, where mechanized cut and fill and longhole mining methods are used to extract the ore, and the remaining ore comes from the Hollinger Open Pit mine. The Dome Underground mine ceased operations in 2017.

Ore is processed at the Dome processing facility using a circuit that includes crushing, grinding, gravity concentration, cyanide leaching, carbon in pulp recovery, stripping, electrowinning and refining.

5. LaRonde, Quebec. 74 koz.

LaRonde mine. Source: Agnico Eagle.

LaRonde is Agnico Eagle’s flagship mine, located in the Abitibi region of northwestern Quebec. LaRonde has produced almost 6 million ounces of gold since it opened in 1988. LaRonde’s 2.2-km deep Penna Shaft is now the deepest single-lift shaft in the Western Hemisphere.

6. Meliadine, Nunavut. 59 koz.

Meliadine gold mine. Source: Agnico Eagle.

Agnico Eagle’s Meliadine Underground Gold Mine is located near the western shore of Hudson Bay in the Kivalliq District of Nunavut, about 25 kilometres north of Rankin Inlet and 290 kilometres southeast of our Meadowbank mine.

Commercial production began at Meliadine in mid-May 2019. The Company anticipates that mining at Meliadine will be carried out through several underground mining operations and open pits over a 14 year mine life. There are numerous opportunities to create additional value at Meliadine, both at the mine and on the large regional land package.

7. Hemlo, Ontario. 54 koz.

Hemlo gold mine. Source: Barrick.

Barrick’s Hemlo property consists of David Bell, an underground mine, and Williams, an underground and open pit mine, located approximately 350 kilometers east of Thunder Bay, Ontario.

The Williams and David Bell mines share milling, processing and tailings facilities where ores from the two mines are co-mingled and fed to a standard grind, leach and carbon-in-pulp extraction mill.

8. Rainy River, Ontario. 49 koz.

Rainy River mine. Source: New Gold.

New Gold’s Rainy River Mine located 65 km northwest of Fort Frances, Ontario, in the southern half of Richardson Township. Rainy River commenced processing ore on September 14, 2017 and completed its first gold pour on October 5, 2017. Commercial production followed on October 19, 2017. Development of the underground mine began in the second half of 2018.

The mine occupies approximately 6,050 hectares, comprising 87 patented mining rights and surface rights claims (including eight leasehold interest mining rights and/or surface rights claims). In addition, New Gold has a land package of approximately 17,240 hectares surrounding the mine site, including patented mining rights and/or surface rights and unpatented claims. All unpatented claims are in good standing and assessment work credits are sufficient to maintain that standing for several years.

9. Macassa, Ontario. 42 koz.

Macassa gold mine. Source: Kirkland Lake.

Kirkland Lake’s Macassa Underground Gold Mine is located in the Town of Kirkland Lake, 580 km north of Toronto, Ontario, Canada.

Macassa is one of the highest gold grade mines in the world. Macassa commenced operations in 2002, and with the discovery of the South Mine Complex (SMC), has been able to increase its level of production significantly over the past five years. The SMC has been driving grade improvement at Macassa, with results from ongoing exploration drilling continuing to extend the SMC mineralization and adding to the Mine’s Mineral Resources in support of growing production and extending mine life.

The mine is located in an area with well-developed infrastructure, including a provincial highway, a railway system and a private airport. High-grade ore is processed at the Macassa Mill, which currently has available capacity and is located in close proximity to the mine.

10.Mount Milligan, BC. 36 koz.

Mount Milligan mine. Source: Centerra.

Mount Milligan is located approximately 155 kilometres northwest of Prince George in central British Columbia, Canada. The Mount Milligan Mine is a conventional truck-shovel open-pit copper and gold mine and concentrator with a 60,000 tpd capacity copper flotation processing plant. Mount Milligan has an estimated mine life of 9 years.

11. Timmins, Ontario. 34 koz.

Timmins gold operation. Source: Pan American Silver.

Timmins operation consists of two underground gold mines, the Timmins West mine and the Bell Creek mine, which both feed the Bell Creek mill. The gold mineralization at Bell Creek mine is mined using underground longhole mining methods. At the Timmins West mine, primary mining methods include longitudinal and transverse longhole mining.

Ore from both mines is processed at the Bell Creek mill via single-stage crushing and single-stage grinding, with a portion of the gold recovered by gravity methods, followed by pre-oxidation and cyanidation with carbon-in-leach and carbon-in-pulp recovery.

12. Lamaque, Quebec. 33 koz.

Lamaque mine. Source: Eldorado Gold.

Lamaque is an underground gold mine in Val-d’Or, Quebec. Commercial production was declared on March 31, 2019.

The Lamaque operation consists of the newly-discovered Triangle gold deposit located only 2.5km south of the historical world-class Lamaque and Sigma Mines, which are also on the property and produced over 10Moz of gold. The Triangle deposit is located in the Val d’Or mining camp, at the eastern end of the prolific Southern Abitibi Greenstone Belt.

The deposit is an Archean greenstone-hosted orogenic lode gold deposit. Gold is found within quartz-tourmaline-carbonate veins, which are hosted within a series of sub-parallel sub-vertical shear zones centered around a steeply plunging cylinder-shaped porphyritic diorite (“The Triangle Plug”), which intrudes the mafic volcanic stratigraphy of the Val d’Or formation.

13. Casa Berardi, Quebec. 31 koz.

Casa Berardi mine. Source: Hecla.

Casa Berardi Underground Gold Mine is situated 95 kilometres north of La Sarre, Quebec and straddles a 37 kilometre section of the Casa Berardi fault.

The Casa Berardi gold deposits are located along a five kilometre east-west mineralized corridor. They include the East and West mines, and the Principal Zones.

The mine has produced approximately 1.9 million recovered gold ounces since commencing production in 1988, including about 931,244 recovered ounces since production recommenced in November 2006.

14. Moose River, Nova Scotia. 29 koz.

Moose River mine. Image credit: St Barbara.

Moose River (Touquoy) Open Pit Gold Mine is located approximately 60km north east of Halifax, Nova Scotia.

After a feasibility study was completed in 2015, mining of the current open pit at Touquoy commenced in 2017, with commercial production declared in March 2018. The operation was delivered on time and on budget and exceeded production guidance in the first year.

Commissioned in October 2017, the processing plant at Touquoy is a conventional CIL circuit with a nominal capacity of 2.0 million tonnes per year.

Further to the currently operational open pit, there is planned expansion of three additional pits nearby at Beaver Dam, Fifteen Mile Stream and Cochrane Hill, with a combined estimated mine life for the operation of 12 years.

As at 25 March 2019, the Atlantic Gold operation had a combined estimated 1.9 million ounces of gold in reserves at a grade of 1.12 grams per tonne. 

St Barbara acquired Atlantic Gold and its Moose River operations on 19 July 2019.

15. Hope Bay, Nunavut. 29 koz.

Hope Bay mine, Nunavut. Image credit: TMAC.

Hope Bay Underground Gold Mine located in Nunavut, Canada. 

Hope Bay is a fly in/fly out operation serviced from Edmonton, Alberta, Yellowknife, Northwest Territories and several Kitikmeot, Nunavut communities with supplies provided by annual sealift and regular aircraft. The nearest community and commercial airport are in Cambridge Bay, approximately 160 km by air.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.