TICKER: TSX:DGC
DESCRIPTION: Detour Gold Corporation is a Canadian gold exploration and development company whose primary focus is to advance the Detour Lake property located on the Abitibi Greenstone Belt in northeastern Ontario toward development and production. The positive results of the pre-feasibility study confirmed that the future Detour Lake open-pit operation can be a significant gold producer with the added benefits of a long mine life within a stable political environment. The company continues to advance the project towards completion of a feasibility study for the first half of 2010.
Detour featured in San Francisco Chronicle (8/2/10)
The information provided below is based on the most recent information we have received from analysts, newsletters and other contributors to Streetwise Reports' The Gold Report or The Energy Report. We encourage you to visit the company's web site and call the company for more specifics on this company before you decide to invest.
"Getting even more love. Detour Gold received a couple target price increases from the Street on Tuesday, one of which came from Canaccord Genuity Precious Metals and Minerals Analyst Steven Butler. He is bullish on Detour Gold based on the company's superior leverage to higher gold prices, an expected year-end reserve increase, potentially improved project economics vs. the feasibility study and rerating potential on advancing Detour Lake to production. More specifically, Butler highlights the following: i) The likelihood of an increased reserve based on a higher gold price (i.e., lower cut-off grade) and westward extension of the ore body confirmed by ongoing drilling. Butler has increased his reserve estimate by 2.1 Moz. to 13.5 Moz. grading 0.9 g/t (from 11.4 Moz at 1.02 g/t); ii) An approximately 30% expansion in throughput to 80,000 tpd beginning Q117 for a total capital cost outlay of US$200M; iii) A reduction in the life-of-mine average strip ratio to 2:1 compared with 3.3:1 as per the feasibility study; and iv) Lower than previously modeled dilution from the recently concluded equity financing for gross proceeds of $289.8M (12.1M shares at $24/share) vs. our estimate of $300M at $19/share."
Catherine Gignac, NCP Northland Capital Partners
(08/20/10)
"Price target increased to $35 from $30. . .Based on the June 2010 feasibility study, the Detour Lake Project hosts proven and probable (P&P) reserves of 11.4 Moz. at an average grade of 1.02 g/t and has a projected annual open-pit production averaging 649,000 oz. gold beginning in 2013. The brownfield site has, historically, produced over 1.8 Moz., which could expedite the permitting process. Further drilling results from the current 90,000m program are expected to lead to a resource update at year-end, which could extend the 16-year mine life based only on P&P reserves. The project is 55% financed using all available cash, and mill equipment is scheduled for a late 2011 delivery. Assuming there is continued strength in the gold price through to the start of production, upside to the share price could be substantial. A 10% change in the gold price affects our NAV by 18%."
The Gold Report Interview with Brian Mok (08/04/10)
"I think there's a bit of a gap that needs to be filled. You've got the large projects that will be coming into production, like. . .Detour Gold's Detour Lake. Those scale at a half-million to a million ounces per year."
View Entire Article: Brian Mok: Gold Dynamics
Ralph Profiti, Credit Suisse Securities (Canada) Inc.
(07/27/10)
"Our Canadian team has initiated coverage on. . .Detour Gold with an OUTPERFORM rating and target price of C$31.5. . .Detour's main asset, the Detour Lake project, is expected to commence production in 2013. We are forecasting LOM average production of 636 koz. at $523/oz., with the first three years at 639 koz. and $459/oz. With over 11 Moz. in reserves and over 21 Moz. in total resources, Detour has accumulated an impressive platform from which to develop into a notable mid-tier miner. With Detour's large reserve base, it trades as the cheapest company on an EV/oz. of reserves relative to its covered peers. As permits are acquired and more financing is arranged, we believe the valuation discount should narrow and a re-rating of the shares may occur. . .Detour currently trades at a P/NAV of 0.6xs, well below its producing peer average of 0.9xs and, in our view, the current share price represents a buying opportunity."
Kerry Smith, Haywood Securities
(07/21/10)
"Our $31.75 target price is at the higher range of Street estimates (ranging from $22.50–$36.00), as we remain bullish on the outlook for the company and believe that management is committed to development and further de-risking of the Detour Lake project.
On July 19, Detour completed its previously announced equity bought-deal financing, resulting in gross proceeds of C$282 million (net C$276M). In total, 11.75 million common shares at C$24/share were issued. These funds will be used to advance the company's 100%-owned Detour Lake gold project. With nearly C$570M cash on the balance sheet (after financing), Detour has effectively secured 50% of the estimated US$1 billion of capital expenditures required to complete construction of the Detour Lake project. We expect Detour will secure all remaining project financing by early 2011."
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