Ekati Diamond Mine Site Tour

DOMINION DIAMOND
CORPORATION
Canada’s Largest Independent Diamond Producer
and Third Largest Producer Globally by Value
Ekati Diamond Mine Site Tour - 2015
Forward Looking Information
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Caution Regarding Forward Looking Information
Certain information included in this presentation constitutes forward-looking information within the meaning of Canadian and United States securities laws. Forward-looking
information relates to management’s future outlook and anticipated events or results, and can include statements or information regarding plans for mining, development,
production and exploration activities at the Company’s mineral properties, sales estimates, expected sales, and expected operating costs. Forward-looking information
included in this presentation includes the estimated mine life and other plans, timelines and targets for mining, development, permitting, production and exploration activities at
the Ekati Diamond Mine, estimated reserves and resources at the Ekati Diamond Mine, production, capital and operating cost estimates for the Ekati Diamond Mine.
Forward-looking information is based on certain factors and assumptions, including, among other things, the current mine plan the Ekati Diamond Mine; construction and
exploration activities at the Ekati Diamond Mine; the timely receipt of required regulatory approvals; mining methods; currency exchange rates; estimates related to the capital
expenditures required to bring the Jay pipe into production; required operating and capital costs; labour and fuel costs; world and US economic conditions; future diamond
prices; and the level of worldwide diamond production. While the Company considers these assumptions to be reasonable based on the information currently available to it,
they may prove to be incorrect. Forward-looking information is subject to certain factors, including risks and uncertainties, which could cause actual results to differ materially
from what the Company currently expects. These factors include, among other things, the uncertain nature of mining activities, including risks associated with underground
construction and mining operations, risks associated with joint venture operations, risks associated with the estimates related to the capital expenditures required to bring the
Jay pipe into production, risks associated with the remote location of and harsh climate at the Ekati Diamond Mine, variations in mineral reserve and mineral resource
estimates, grade estimates and expected recovery rates, failure of plant, equipment or processes to operate as anticipated, risks resulting from the Eurozone financial crisis,
risks associated with regulatory requirements and any delays in receiving required regulatory approvals, the risk that diamond price assumptions may prove to be incorrect,
the risk of fluctuations in diamond prices and changes in US and world economic conditions, or the risk of fluctuations in the Canadian/US dollar exchange rate and cash flow
and liquidity risks. Please see the Company’s most recently filed Management’s Discussion and Analysis, as well as the Company’s current Annual Information Form, both
available at www.sedar.com and www.sec.gov, respectively, for a discussion of these and other risks and uncertainties involved in the Company’s operations. Actual results
may vary from the forward-looking information.
Readers are cautioned not to place undue importance on forward-looking information, which speaks only as of the date of this presentation, and should not rely upon this
information as of any other date. Due to assumptions, risks and uncertainties, including the assumptions, risks and uncertainties identified above, actual events may differ
materially from current expectations. While the Company may elect to, it is under no obligation and does not undertake to update or revise any forward-looking information,
whether as a result of new information, future events or otherwise at any particular time, except as required by law.
Technical Information
The scientific and technical information relating to the Ekati Diamond Mine included herein has been prepared and verified by Dominion, operator of the Ekati Diamond Mine,
under the supervision of Peter Ravenscroft, FAusIMM, of Burgundy Mining Advisors Ltd., an independent mining consultant, and a Qualified Person within the meaning of
National Instrument 43-101 of the Canadian Securities Administrators and is given as of January 31, 2015.
Agenda
• Health & Safety – Ekati’s Journey to Zero Harm
• Our Assets, Skilled Workforce and Overview of Operations
• Ekati Kimberlites - Geology
• Ekati Underground Operations
• Misery Main
• Pigeon
• Ekati Processing Plan & Plant Facilities
• Future Development – Lynx, Jay and Sable
• Next Steps
• Questions?
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Health & Safety – Ekati’s journey to Zero Harm
At Ekati, our message for health and
safety is and will always remain as the
“Courage to Care”
•
Our goal: To work with our people to
reduce and eliminate workplace injuries
•
Our approach: To provide a safe and
injury free workplace through committed
leadership and teamwork
•
To achieve this we are using the Zero
Incident Process (ZIP) Program which is
a behavior-based safety system that
focuses on the “people” component of a
safety culture model
•
Our people are the most important
resource
•
All of us have a role to play to make
Ekati a safe place to work
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Our Assets
A Canadian diamond mining company
with ownership interests in two of the
world’s most valuable diamond mines
Both are located in the stable fiscal and
political environment of northern Canada
• Ekati Diamond Mine - 88.9%
ownership of the Core Zone, 65.3%
of the Buffer Zone
• Diavik Diamond Mine – 40%
ownership
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Ekati – Mine Facts
•
Ekati started operations in 1998
•
Mining methods are open pit and
underground
•
To date, more than 465 million tonnes
of rock mined and more than 68 million
tonnes processed (100% basis)
•
Over 60 million carats produced to date
(100% basis)
•
Plant capacity of 4.35 million tonnes per
year or approximately 12,000 tonnes
per day
•
27 million tonnes of rock (kimberlite and
waste) expected to be mined in fiscal
year 2016
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Ekati – Skilled Workforce
Our Ekati Workforce
• 1413 employees as at January 31, 2015
• 57% (808) of our employees are
permanent (DDEC)
• 43% (605) of our employees are
contractors
• Northerners – presently at 64% versus
target of 62%
• Aboriginal – 42% versus target of 31%
Our Goals
• Attract skilled talent, ensuring focus on
commitments and business needs
• Actively engage and develop our people
• Implement improved mechanisms to
gauge employee satisfaction
• Roll out new Organizational Development
Performance management tools
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Overview of Operations
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Sable
Koala U/G
Pigeon
Koala North
Panda
Beartooth
Ekati
Fox
Jay
A-21
A-418
A-154S
A-154N
Misery
Lynx
Diavik
Ekati – Active Mining Operations
Pigeon (May 2015)
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Misery
Ekati – Pipe Shapes
Grid: 100m x 100m
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Ekati – Underground Operations
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Koala Cave Draw Strategy
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• ‘Ring pull’ draw levels around the
circumference of the pipe at the 1970L,
1850L, and 1830L
• 1970L to draw phase 5 ore in earlier
and at a higher elevation
• 1810L to draw as standard SLC level
(from one side only)
• Individual draw points are mucked in a
specific sequence that allows for an
even drawdown of the broken ore
blanket
1970
1850
1830
1810
Misery Main
Misery Main
•
Probable reserve grade increased from 4.0
carats per tonne to 4.7 carats per tonne
•
Approximate price per carat of US$861
•
3 million tonnes of probable reserves
Satellites – South and Southwest
Extension
•
H1 FY16: 747,000 carats recovered; grade of
1.6 carats per tonne, average price of US$80
per carat
Capex
•
Approximately US$78 million to be spent this
year. The first ore from Misery Main is
anticipated to be put through the processing
plant in early 2016
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Based on the Company’s October 2014 prices.
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Ekati – Pigeon Pipe
•
Located 5 kilometers northwest of
Koala with a surface area of 3.5
hectares
•
Stripping of waste material is
underway
•
Ore mining scheduled to commence
in calendar 2015 and finishing in
2019
•
Probable reserves of 7.4 million
tonnes at a grade of 0.5 carats per
tonne
•
Approximate price per carat of
US$1801
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Based on the Company’s October 2014 prices.
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Pigeon pit development as of May 2015 with
superimposed kimberlite pipe (green)
Ekati Plant Capacity of 4.35 million tonnes
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Operating Case Mine Plan – Ore Mined and Mill Feed Mined
Tonnage by financial year ending January 31st
Dry Tonnes Million
Spare Capacity filled
with Coarse Ore
Rejects (“COR”)
5.00
4.50
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.50
-
Spare Capacity
Jay
Misery SW
Misery South
Lynx
Fox Stockpile
Pigeon
Misery Main
Koala
FY2016
1.35
0.60
0.50
0.10
0.70
1.10
FY2017
1.54
0.68
0.28
0.02
0.23
0.69
0.91
FY2018
1.28
0.13
0.01
0.76
0.38
1.07
0.72
FY2019
0.08
0.67
0.30
1.89
0.71
0.70
FY2020
1.15
0.23
2.30
0.24
0.43
FY2021
0.01
1.98
0.16
1.80
0.31
0.09
Lynx and Jay are part of the Buffer Zone All other deposits are part of the Core Zone.
Misery South and Southwest are currently inferred resources. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
Inferred mineral resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be
categorized as mineral reserves. There is no certainty that this assessment will be realized. Readers should reference the Company’s technical report in
respect of the Ekati Diamond Mine dated March 12, 2015 available through www.sedar.com or www.ddcorp.ca
Ekati – Processing Plant
•
Ore processed through
crushing, screening and
scrubbing circuits
•
Heavy minerals including
diamonds separated from
light minerals by the Dense
Media Separation circuits
•
Diamonds separated from
the dense mineral
concentrate using X-ray
luminescent sorting and
grease tables
•
Fine processed kimberlite
deposited into the Long
Lake Storage Facility
(LLCF) and Beartooth pit
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Ekati – Plant Improvements
Plant improvements completed:
•
Pre-feasibility study for fine diamond
recovery circuit
•
Upgrading of plc system (programmable
logic controller)
•
Six day annual maintenance shutdown
completed
Additional planned improvements:
•
Back to basics and steady state approach
•
Optimisation of diamond liberation from
host kimberlite by improving crusher
controls and loadings
•
Optimisation and efficiency improvements
around dense media separation (DMS)
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Diamond Recovery Optimization – July 2015
• New diamond liberation initiative commenced
in July 2015. Testing of the initiative is
continuing
• The initiative includes a reduction in the level
of throughput to the plant from 12,000 to
10,500 tonnes per day (or approximately 4.3
million tonnes to 3.8 million tonnes per year)
• Initial test results show a significant increase in
grade recovered, primarily of diamonds of all
sizes up to 1.5 carats, and only marginal
decrease in dollar per carat
• Early indications show the financial impact
could be incrementally positive to annual
revenues even at a lower throughput
• An updated mine plan including the impact of
the changes on the production schedule,
diamond prices and operating costs, will be
published once the changes have been fully
tested and positive results confirmed
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Project Update - Lynx
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2015 Program
• All permits in place to initiate work
• Road construction, dewatering lines, fish
out and de-watering this summer
• Pre-stripping scheduled for late 2015
Mine Plan
• Less than one year pre-strip
• Ore production expected in fall 2016
• Probable reserve of 1.1 million tonnes at
a grade of 0.9 carats per tonne
• Approximate price per carat of US$2411
• Over 12 million tonnes of granite to be
mined and used for Jay road and dike
construction projects
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Based on the Company’s October 2014 prices.
Proposed Lynx pit development showing lake to be de-watered
(blue) and superimposed kimberlite pipe (green)
Project Update - Jay
2015 Drilling Program – current
status
•
Winter drilling program completed along
planned dike alignments
•
Winter geotechnical and hydro-geology
drilling program complete
•
Currently incorporating results into feasibilitylevel design of dike, pit, and associated
infrastructure
•
Winter Reverse Circulation drilling program
at Jay to better understand the diamond
value complete (1,250 tonne sample
collected)
•
Jay sample currently being processed
through Ekati sample plant
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Project Update - Jay
Jay Permitting – Current status
•
Developer’s Assessment Report submitted
November 6, 2014
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501 information requests received,
responses submitted April 7
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Technical sessions held April 20-24
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Responses to second round of information
requests submitted July 3
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Public Hearings scheduled for September
14-21 in Yellowknife, Behchokǫ̀, Łutsel K'e,
and Kugluktuk
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Decision on Environmental Assessment
expected January 2016
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Land Use Permit and Water License
expected by end of 2016
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Sable Project
Summary Facts and Status
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15.4 million tonnes of indicated resource at 0.9
carats per tonne
•
Located 17 kilometers N/NE of Ekati
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Permitted with Pigeon/Beartooth
Activities in FY16
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Winter bulk sample RC drilling (1500 tonnes)
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Diamond valuation (>2000 carats total)
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Pre-feasibility Study in progress
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Project Update - Sable
2015 Program - Update
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Bulk sampling program recovered
approximately 1,500 tonnes from
eight large diameter holes
•
All eight reverse circulation drill holes
have been processed at the Ekati
Sample Plant and diamond picking
has been completed. Parcel
valuation in progress.
•
Pre-feasibility study in progress
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Ekati - Next Steps
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In the current Mine Plan
Longer-term exploration potential
•
•
•
•
•
• Fox underground
• Jay underground
• Exploration potential on existing trend lines
Misery Main pushback on plan
Koala underground operation
Pigeon on plan
Lynx permitted and on schedule
Jay open pit – Feasibility Study in progress
Not In the current Mine Plan
• Sable – Open Pit
• Permitted for mining; haulage road is
permitted but design requires approval
• Economic evaluation in progress
• Pre-feasibility study in progress
• Koala Underground – Potentially additional
material below 1810 level
• Process plant Liberation Optimization
Questions?
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