Capital and Operating Costs
Capital and operating costs in the Optimization Study were adjusted on the basis of modified deliverables and material take offs arising from the mine design scope changes. No changes were made to quantity estimates where no design changes had been made. Capital cost is estimated at an accuracy of -11% and +19%. All estimated costs were escalated to October 2012 terms from June 2011 terms previously by applying market inflation indices. Indirect, owners and EPCM costs were re-assessed on the basis of the revised project schedule including early works and infrastructure availability. Contingencies, risk and escalation factors were all re-assessed.
Initial capital costs are now estimated at C$752.1 million, including a contingency of C$64.7 million, expressed in October 2012 terms. Life of Mine capital cost, including escalation commencing in Q4 2012, the Renard Mining Road, sustaining and deferred capital, less credits for pre-production revenue and salvage value, are estimated at C$1,012.9 million.
November 2011Table 2: Estimate of Capital Costs(1) Feasibility January 2013 Study Optimization---------------------------------------------------------------------------Site Preparation & General $ 22.9 $ 32.7Mining $ 236.9 $ 151.2Mineral processing plant $ 168.4 $ 175.4Onsite utilities and infrastructures $ 102.4 $ 114.8Owner's Cost $ 86.2 $ 94.7Spares, fills, tools $ 10.2 $ 7.1EPCM services $ 45.0 $ 47.9Field indirect costs, vendor representatives $ 22.5 $ 33.9Construction camp & Catering $ 25.0 $ 24.5Freight and duties $ 8.1 $ 5.5Contingency $ 74.3 $ 64.7---------------------------------------------------------------------------Total Initial Capital $ 801.8 $ 752.1---------------------------------------------------------------------------Escalation Allowance on Initial Capital $ 57.3 $ 45.1Pre-Production Revenue $ (24.6) $ (25.0)Deferred & Sustaining Capital(2) $ 138.8 $ 175.9Deferred Capital (Route 167 Extension) $ 44.0 $ 0.0Renard Mine Road(2) $ 0.0 $ 78.0Salvage Value(2) $ (22.9) $ (13.3)---------------------------------------------------------------------------Total Life of Mine Capital, After $ 994.4 $ 1,012.9Contingency, Escalation, Deferred andSustaining Capital---------------------------------------------------------------------------All figures in C$ million.1. Totals may not add due to rounding.2. After Escalation
Life of mine operating cost is estimated at C$57.63/tonne (C$76.63 per carat; Table 3). The majority of open pit costs at Renard 2 and 3 occur before June 2016 and are contained within the capital cost estimates.
Table 3: Estimate of Operating Costs(1,2) November 2011 January 2013 Feasibility Study Optimization ------------------------------------------------ Unit Cost Unit Cost C$ millions $/Tonne C$ millions $/Tonne---------------------------------------------------------------------------Open Pit Mine $ 6 $ 0.27 $ 10 $ 0.43Underground Mine(3) $ 556 $ 24.45 $ 555 $ 23.64Processing $ 344 $ 15.13 $ 359 $ 15.29G&A $ 338 $ 14.86 $ 429 $ 18.27---------------------------------------------------------------------------Total Life of Mine $ 1,244 $ 54.71 $ 1,352 $ 57.63Operating Costs ($70.27/ct) ($76.63/ct)---------------------------------------------------------------------------1. Totals may not add due to rounding. November 2011 Feasibility Study costs are expressed in Q3 2011 terms. January 2013 Optimization costs are expressed in Q3 2012 terms.2. Excludes capitalized preproduction costs.3. Unit cost per processed tonnes. Unit cost per mined tonnes were $26.13 in the November 2011 Feasibility Study and are $25.53 in the 2013 Optimization Study.
