agnico eagle mines, ltd mexico · geology and drilling drilling campaign 2012: 13,800 m ddh´s...
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AGNICO EAGLE MINES, LTD
MEXICO Chihuahua, Chih.
Sept 13rd, 2012.
The information in this document has been prepared as at September 18, 2012. Certain statements contained in this document constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward looking information under the provisions of Canadian provincial securities laws. When used in this document, the words “anticipate”, “expect”, “estimate”, “forecast”, “will”, “planned”, and similar expressions are intended to identify forward-looking statements or information.
Such statements include without limitation: statements regarding timing and amounts of capital expenditures and other assumptions; estimates of future reserves, resources, mineral production, optimization efforts and sales; estimates of mine life; estimates of future internal rates of return, mining costs, cash costs, minesite costs and other expenses; estimates of future capital expenditures and other cash needs, and expectations as to the funding thereof; statements and information as to the projected development of certain ore deposits, including estimates of exploration, development and production and other capital costs, and estimates of the timing of such exploration, development and production or decisions with respect to such exploration, development and production; estimates of reserves and resources, and statements and information regarding anticipated future exploration; the anticipated timing of events with respect to the Company's mine sites and statements and information regarding the sufficiency of the Company's cash resources. Such statements and information reflect the Company's views as at the date of this document and are subject to certain risks, uncertainties and assumptions, and undue reliance should not be placed on such statements and information. Many factors, known and unknown could cause the actual results to be materially different from those expressed or implied by such forward looking statements and information. Such risks include, but are not limited to: the volatility of prices of gold and other metals; uncertainty of mineral reserves, mineral resources, mineral grades and mineral recovery estimates; uncertainty of future production, capital expenditures, and other costs; currency fluctuations; financing of additional capital requirements; cost of exploration and development programs; mining risks; community protests; risks associated with foreign operations; governmental and environmental regulation; the volatility of the Company's stock price; and risks associated with the Company's byproduct metal derivative strategies. For a more detailed discussion of such risks and other factors that may affect the Company’s ability to achieve the expectations set forth in the forward-looking statements contained in this document, see the Company's Annual Report on Form 20-F for the year ended December 31, 2011, as well as the Company's other filings with the Canadian Securities Administrators and the U.S. Securities and Exchange Commission. The Company does not intend, and does not assume any obligation, to update these forward-looking statements and information. Marc Legault, a Qualified Person and the Company’s Senior Vice-President, Project Evaluations, reviewed the technical information disclosed herein. For a detailed breakdown of the Company’s reserve and resource position see the February 15, 2012 press release on the Company’s website. That press release also lists the Qualified Persons for each project. For a detailed breakdown of the La India reserve and resource position see the September 4, 2012 press release on the Company’s website.
Forward Looking Statements
SHAFT PROJECT
GROWTH OPPORTUNITIES
LA INDIA PROJECT
Q2 UPDATE
• Q2, no lost time accidents. The total combined frequency index for Q2 2012 was 1.62 and YTD was 1.20
• Total Q2 payable Au ounces production 63,355 Au oz; YTD was 120,370 Au oz . Cash costs $358 Q2 and $322 YTD
• Exploration results at Creston Mascota shows an increase of approximately 190k oz in probable reserves, add approx 3 yrs to mine life.
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2010 2011 2012
Mexico Au Production (´000 Oz)
Actual Q1 Actual Q2 Actual Annual Guidance
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2,978
13,932
26,229 29,665
35,247 39,954
48,000 51,067 52,740 52,574 57,014
63,355
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Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012
Payable Au Oz
Au Oz / Qtr
15,343
106,308
222,213 248,411
289,427
426,853 406,045 451,771
485,100 508,513 507,626
535,285
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Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012
Payable Ag Oz
Ag Oz / Qtr
Mexico Oz Production by Quarter
• 3,265 tpd ore production average during Q2 vs. 3,000 tpd design
• Total UG unit cost was $28.67 per tonne .
• Meters of lateral development YTD was 3,710 vs. 3,695 budget and unit cost $2,480 USD/m
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Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012
Tonnes Quarter USD$/tonne YTD USD$/tonne
Ore Production & Cost per tonne performance
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Underground Mine
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• Total Open pit ore production for Q2 was 844,851 tonnes averaging 1.86 g/t Au.
• Total Open pit unit cost was $1.34 per tonne.
• The indicators YTD at the end of June were as follows:
Open Pit Mine (SN+OW+Mascota)
Performance indicators Current Quarter YTD Realized
Waste production (t) (000´) 4,911 10,395
Ore production (t) (000´) 844 1,573
Total Material (t) (000´) 5,756 11,968
Total blasting (t) (000´) 5,906 12,783
Total drilling (m) 6,100 13,097
• The mill Avg. availability for Q2 was 93.07% • Productivity for Q2 was 5,035 TPD • Cost per tonne was US$18.09/tonne YTD. • Q2 Mill Au-Oz Production of 40,421 & 79,225 Au-Oz YTD. • Q2 Heap Leach Au-Oz Production of 4,887 & 9,373 Au-Oz YTD.
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2010 2011 Q1 2012 Q2 2012
Mill Ore Production (‘000 tpQrtr)
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Pinos Altos Process
Mascota Process
• Q2 ore production in Mascota Pit was 477,013.
• Q2 Total Heap Leach Au-Oz produced 18,048 Oz and 31,172 Au-Oz YTD.
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Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012
Au Ounces Production (Oz)
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Ore Placed (000 tonnes)
tonnes placed
AEM SHAFT I
AGNICO-EAGLE MINES LIMITED MEXICO SEP 2012
• Budget investment of US$106 million Approved in Q2 2012 from BOD.
• Shaft project under construction actually for an increase UG production from 3,000 tpd to 4,500 tpd, lower cash costs, reduced capex LOM, and higher NAV (shorter mine life). Incremental IRR 23%
Shaft Highlights
LA INDIA AERIAL VIEW
AGNICO-EAGLE MINES LIMITED MEXICO SEP 2012
AGNICO EAGLE MINES, LTD LA INDIA PROJECT
Sonora, Mex.
Sept 13rd, 2012.
La India
Location: Municipality of Sahuaripa at Sonora State, Mexico. 210 km at E-SE from Hermosillo.
The La India property is located in the prolific Mulatos Gold Belt, in the Sierra Madre Occidental gold and silver belt
PA and Mascota are located 70 Kms to the southeast of LI
Location
La India & Tarachi
• Probable reserves: 0.93 million ounces gold (44.6 million tonnes at 0.65 g/t)
• Indicated gold resources: La India : 0.4 million ounces gold (27.2 million tonnes at 0.5 g/t)
• Inferred gold resource: La India : 1.1 million ounces gold (103.4 million tonnes at 0.3 g/t)
Property: 55,000 has aproximately.
• $157.6 million capital expenditure for construction • Production of 44.6 Million ore tons @ 0.65 gr/ton. • Mine operations : 16,000 tpd, Open pit – heap leach mine • Stripping ratio of 1:1 • Metallurgical recoveries : estimate an average of 80% • Estimated LOM: 8 – 9 years
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PP 2014 2015 2016 2017 2018 2019 2020 2021 2022
USD
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Au O
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Au Oz (´000) vs. USD$/Oz
Au Oz (´000) La India USD$/ Oz
Preliminary Production & Cost Estimates – La India
Geology and Drilling
Drilling campaign 2012: 13,800 m DDH´s & 7,500 m RC.
• Numerous epithermal gold occurrences are exposed in old abandoned mines or works in the area of India.
• Massive silica bodies are the most common
• The host rocks include hydrothermal breccias, andesitic, dacitic porphyries and volcaniclastic strata, both high angle and low angle structural stratigraphic which control the mineralization.
• Additional budget for infill conversion: 5,000 m DDH.
General Arrangement
• On September 4, 2012 the development and construction of the La India Mine in Sonora Mexico was approved.
• Site preparation work was initiated in the third quarter of 2012.
• Construction of the project will begin immediately.
• Regional exploration in progress. • Environmental permits MIA and CUS
authorized to start construction and operations.
• Approval of Municipalities of Arivechi and Sahuaripa for project development.
• Explosives permit request in evaluation by SEDENA (explosives management entity).
Current Status
CONSTRUCTION IN
PROGRESS
A first phase of preparation activities that includes magazines, construction camp, heap leach and pond areas is in progress.
Site Preparation
AGNICO EAGLE MINES, LTD LA INDIA PROJECT
Sonora, Mex.
Sept 13rd, 2012.
AGNICO-EAGLE MINES LIMITED MEXICO SEP 2012
CONCESSIONS
AEM Mining Concessions in Mexico PA & LA
54,981 Has
PINOS ALTOS
MASCOTA
58,339 Has
Pinos Altos & Mascota operations & satellite projects
La India and Tarachi Projects
Resources for Growth Opportunities
Tonnes Au Ag Au Ag(T) (g/t) (g/t) (Oz.) (Oz.)
Cubiro UG 2,003,000 2.57 16.72 165,000 1,076,000 Bravo PIT - - - - - Sinter PIT 3,661,000 1.08 17.38 127,000 2,046,000 Reina de Plata - - - - - Tarachi* 21,456,000 0.57 - 390,000 - Total Indicated 27,120,000 0.79 17.14 683,000 3,122,000
Tonnes Au Ag Au Ag(T) (g/t) (g/t) (Oz.) (Oz.)
Cubiro UG 1,237,000 2.58 16.80 103,000 668,000 Bravo PIT 5,009,000 0.75 10.65 121,000 1,715,000 Sinter PIT 537,000 0.90 12.98 16,000 224,000 Reina de Plata 8,722,000 0.86 24.30 240,000 6,813,000 Tarachi* 12,395,000 0.52 - 208,000 - Total Inferred 27,900,000 0.77 18.90 687,000 9,420,000
Inferred
Indicated
Resources as of December 31,2011 (*) Oxides The assumptions used for the mineral resources estimates reported by the Company on February 15, 2012 were based on three-year average prices for the period ending December 31, 2011 of $1,255 per ounce gold, $23.00 per ounce silver and a MXP/US$ exchange rate of 12.86. The Qualified Person responsible for the mineral resource estimate at the Pinos Altos property (Cubiro, Bravo, Sinter and Reina de Plata) is Dyane Duquette, P.Geo., Superintendent of geology, Technical Services Group. The Qualified Person responsible for the resource estimate at Tarachi is Gary Giroux, P.Eng., independent consultant.
AGNICO EAGLE MINES, LTD
MEXICO Chihuahua, Chih.
Sept 13rd, 2012.