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Donlin Gold

Technical Report

Operations & Infrastructure

Among the world's most significant gold projects with a 27 year mine life.

Mine Operations

Donlin Gold is expected to be a conventional open pit, truck-and-shovel operation. Production is expected to occur over 27 years (inclusive of one year of pre-stripping). The process plant will be fed with stockpiled low-grade ore for two additional years following the completion of production. Peak production rates are expected to reach 155 million tonnes per year (425,000 tonnes per day). The primary mining equipment required includes large hydraulic shovels, front-end loaders, ultra-class haul trucks, rotary blast hole drills, and various support equipment including track dozers, wheel dozers, graders, water trucks, and excavators.

Metallurgy and Processing

The run-of-mine (ROM) ore from the Donlin Gold deposit will be crushed in a gyratory crusher and then milled using semi-autogenous grinding (SAG) and two-stage ball milling. Average throughput is expected to be 53,500 tonnes per day. The gold-bearing sulphides will be recovered by flotation to produce a 7% sulphide concentrate representing around 15% of the original mass with an average gold grade of 12.7 to 13.0 g/t. The concentrate is refractory and will be pre-treated in a pressure oxidation circuit (autoclave) prior to cyanidation (Carbon-In-Leach). Overall gold recovery from flotation, pressure oxidation and cyanidation is estimated at 89.8%. Excess acid from the autoclave circuit will be neutralized with flotation tailings and slaked lime. Prior to being combined with flotation tails, cyanide tails will be detoxed. All tailings from this process will be impounded in the tailings storage facility. During operations, water will be reclaimed for re-use in the process plant.

Supporting Infrastructure

Due to the remote location of Donlin Gold, infrastructure required to support the mine and process operations include a marine cargo port near Bethel, an upriver port near Jungjuk Creek, ocean and river barging operations, an access road from the upriver port to site, a permanent camp, an airstrip, power generation facilities, fuel storage facilities, water management facilities, and a natural gas pipeline.

Natural Gas Pipeline

Donlin Gold is proposing to build a buried natural gas pipeline to serve as the energy source for on-site power generation. The 315 mile-long (507-kilometer-long), 14-inch-diameter (356 mm) (nominal pipe size [NPS]) steel pipeline would transport natural gas from the Cook Inlet region to the project site.

This natural gas pipeline is a better economic alternative over the life of mine to the previously considered barging of diesel fuel. Operating costs assume a delivered gas pricing which includes importing liquefied natural gas (LNG) to Anchorage; total delivery costs associated with purchase, transportation, and regasification of the LNG; delivery through the Cook Inlet pipeline network (existing 20-inch-diameter (508mm) natural gas pipeline near Beluga); and operating costs for the Cook Inlet-to-Donlin Gold pipeline.

Capital Cost Estimate

The total estimated cost as per the second updated feasibility study published in November 2011 and amended in January 2012, to design and build the Donlin Gold project, would be $6.7 billion.

Opportunities have been identified for potential reduction of the project’s initial capital cost amount, by transferring construction and operation of significant infrastructure components, such as the natural gas pipeline, power plant, oxygen plant, and port operations, to third-party owner/operators.
 

OPERATING COST ESTIMATE

Operating costs at Donlin Gold, estimated in the second updated feasibility study, are generally categorized into mining, processing, general and administrative (G&A), or refining.  Mine operating costs are expected to total approximately $8.2B over the life of mine (LOM), or $2.52 per tonne mined.  Process operating costs are expected to total $7.8B over the LOM, or $15.47 per tonne processed.  G&A costs are expected to total $1.6B over the LOM, or $3.22 per tonne processed.  Refining costs represent a minor component of operating costs at $31M over the LOM.  Average operating costs over the LOM are expected to be $34.99 per tonne processed or $581 per gold ounce produced.  Significant drivers of operating costs include diesel fuel, natural gas (for generating electric power), labor, processing reagents and consumables, explosives, tires, fixed and mobile maintenance supplies, and consulting and contracting services.  

Footnotes

Source: Donlin Gold Project NI 43-101 Technical Report entitled “Donlin Creek Gold Project Alaska, USA, NI 43-101 Technical Report on Second Updated Feasibility Study” effective November 18, 2011, amended January 20, 2012. A copy of the Donlin Gold Technical Report is available here as well as at www.sedar.com or www.sec.gov.

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