Agnico Eagle Releases Detour Lake Proposed Underground Mining Plan Demonstrating Strong Returns and Pathway to Annual GOLD Production of One Million Ounces
Stock Symbol: AEM (NYSE and TSX)
For further information: Investor Relations: (416) 947-1212
(All amounts expressed in U.S. dollars unless otherwise noted)
AGNICO EAGLE RELEASES DETOUR LAKE PROPOSED UNDERGROUND MINING PLAN
DEMONSTRATING STRONG RETURNS AND PATHWAY TO ANNUAL GOLD PRODUCTION OF ONE
MILLION OUNCES
Toronto (June 19, 2024) – Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM) ("Agnico Eagle" or the
"Company") is pleased to provide an update on the Detour Lake mine, located in Ontario.
The Company has recently completed an updated mineral reserve and mineral resource estimate
("MRMR") and an updated life of mine plan (the "2024 Life Of Mine Plan" or the "2024 LOMP") for its
Detour Lake mine as at March 31, 2024. The 2024 LOMP builds on the Company's previously filed
technical report on Detour Lake (2021) as well as the mine plan update released by the Company in July
2022 (the "2022 LOMP") (see the Company's news release dated July 27, 2022).
The 2024 LOMP updates the open pit mine production profile and incorporates updated costing. The
Company has also completed a preliminary economic assessment (the "2024 PEA") which contemplates
the concurrent operation of the open pit and a proposed underground mining project (the "Underground
Project"), combined with mill throughput optimization to 29 million tonnes per annum ("Mtpa"). The 2024
PEA demonstrates that the Underground Project and the mill optimization have the potential to increase the
Detour Lake mine's overall production to an average of approximately one million ounces of gold per year
over a 14 year period, starting in 2030.
"At Detour Lake, the Company continues to build on the unique potential of this world class asset. With the
development of an underground mine to complement the existing open pit mine, we see the opportunity to
transform the asset into one of the top five gold mines in the world by output. We believe the Underground
Project has relatively low execution risk, and has the potential to generate a strong risk-adjusted return on
capital while maintaining exploration and production upside for decades in one of the best mining
jurisdictions in the world," said Ammar Al-Joundi, Agnico Eagle's President and Chief Executive Officer. "We
have adopted a phased and disciplined approach to develop this potential, with the approval of a $100
million investment over the next three years to further study and de-risk the Underground Project, including
the development of an exploration ramp and the collection of a bulk sample. Concurrently, we are planning
a conversion and expansion drill program to realize the upside exploration potential along the western
plunge of the mineralization. The long mineral reserve life and significant production base at both Detour
Lake and Canadian Malartic provide a solid foundation for Agnico Eagle's production profile and strongly
positions the Company for decades to come," added Mr. Al-Joundi.
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Highlights from the 2024 PEA include:
• Pathway to produce one million ounces per year at Detour Lake
◦ The PEA 2024 delivers on the Company's objectives to increase returns and lengthen the
mine life. The Underground Project provides earlier access to a high grade core of
mineralization at depth below the reserve pit through underground development and
displaces lower grade open pit production to the end of life. The project also sets the stage
for future underground expansion along the western plunge of the mineralization
◦ The updated MRMR delineates a subset of the mineral resources with a gold cut-off grade
of 1.22 grams per tonne ("g/t"), which is amenable to underground mining within, and
proximal to, the open pit mineral resource. The mineral resource estimate from the high-
grade mineralized corridors totals 1.2 million ounces of gold ( 19.0 million tonnes grading
1.93 g/t gold) of indicated mineral resource and 7.1 million ounces of gold (107.7 million
tonnes grading 2.05 g/t gold) of inferred mineral resource
◦ In the 2024 PEA, t he Underground Project incorporates in the mine plan approximately
55% of the in-situ high-grade mineral resources, including approximately 0.7 million
ounces of gold in indicated mineral resources ( 9.0 million tonnes grading 2.36 g/t of gold)
and 3.9 million ounces in gold of inferred mineral resources ( 48.5 million tonnes grading
2.50 g/t of gold)
◦ Relative to the 2022 LOMP, the life of mine payable gold production increases by 27% to
22 million ounces of gold in the 2024 PEA, including an increase of 0.7 million ounces of
gold from the open pit and the addition of 4.0 million ounces of gold from the Underground
Project
◦ The 2024 PEA assumes an underground mining rate of approximately 11,200 tonnes per
day ("tpd") (equivalent to 4.0 Mtpa) starting in 2030, combined with a mill expansion to
79,450 tpd (equivalent to an annualized 29 Mtpa) starting in 2028. Annual production is
expected to increase by approximately 43% or 300,000 ounces of gold per year, from 2030
to 2043 to approximately one million ounces per year when compared to average annual
production in years 2024 to 2029
◦ The 2024 PEA extends Detour Lake's mine life by two years to 2054. The Company
believes that there is a good upside potential for additional exploration to add ounces to
the mine plan in future years, which could result in an increase in production in the period
between 2044 and 2054 or extend the life of the mine
◦ The large MRMR base provides a foundation for the Company's production profile for
decades to come
• The Underground Project and mill optimization bring value forward and improve valuation
◦ Overall, the inclusion of a portion of the large mineable mineral resource, increased mill
throughput rate and current high gold price environment contribute significantly to increase
the economic value of Detour Lake, more than offsetting inflationary cost increases since
the 2022 LOMP
◦ The average total cash costs for the Underground Project, combined with the mill
optimization to 29 Mtpa, are expected to be $690 per ounce
◦ Development capital expenditures for the Underground Project and mill optimization to 29
Mtpa are forecast to be approximately $731 million . Sustaining capital expenditures are
forecast to be approximately $631 million over the life of the Underground Project, or
between $40 million to $45 million per year from 2030 to 2043
◦ The Underground Project and mill throughput optimization to 29 Mtpa are expected to
generate an after-tax internal rate of return ("IRR") of approximately 18% using a gold price
assumption of $1,900 per ounce and a C$/US$ foreign exchange rate of 1.34. At current
gold prices of approximately $2,300 per ounce and a C$/US$ foreign exchange rate of
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1.34, the Underground Project and mill throughput optimization to 29 Mtpa are expected to
generate an after-tax IRR of approximately 25%
◦ The Detour Lake mine is forecast to generate strong free cash flow through the
construction phase of the Underground Project
◦ Phased approach to further study and de-risk the project, with limited investment over next
three years
◦ The Company has approved a $100 million investment from 2024 to 2026 to develop a 2.0
kilometre exploration ramp to a depth of approximately 270 metres to collect a bulk sample
and to facilitate infill and expansion drilling of the current underground mineral resource.
Another zone to the east will be tested through a high intensity drilling program in 2025.
The analysis of the bulk sample and results from the high intensity drilling program will help
validate the continuity of the mineralization and the accuracy of the geological model
◦ The exploration ramp will be sized to accommodate a potential production phase and is
included in the initial capital expenditure estimate of approximately $731 million
• Significant exploration potential to grow underground mineral resources
◦ The 2024 PEA is based on a mineral resource estimate which relies on a drill database
cut-off as at October 16, 2023. The Company has since drilled an additional 131,500
metres in 142 holes at Detour Lake to the end of May 2024 in an ongoing exploration
program which has returned some of best intercepts to date at Detour Lake. The recent
exploration results show potential to significantly expand the underground mineral resource
at shallow depth, west of the pit
◦ As part of the Company's exploration budget, over the next three years, an exploration
program of $65 million will be carried out at Detour Lake to accelerate conversion and
expansion drilling of the current underground mineral resource. Exploration in 2024 is
continuing to test and extend the western plunge of the main deposit
• Continue to enhance value through optimization studies and exploration focus
◦ Concurrent with the enhanced exploration program and the development of the exploration
ramp, the Company will continue to evaluate the optimization of the open pit, underground
mining and mill processes to further improve project returns, including the potential to
increase the mill throughput beyond the currently contemplated 29 Mtpa
◦ The Company will continue to advance regional exploration activities on satellite targets on
the Company's large land position around the Detour Lake and adjacent Detour East
properties that could potentially extend the mine life
Detour Lake Technical Presentation
Agnico Eagle's senior management will host a conference call on Wednesday, June 19, 2024 at 9:00 AM
(E.D.T.) to provide a technical update on the Detour Lake mine and the Underground Project.
Via Webcast:
A live audio webcast of the conference call will be available on the Company's website
www.agnicoeagle.com.
Via URL Entry:
To join the conference call without operator assistance, you may register and enter your phone number at
https://emportal.ink/45cKG9E to receive an instant automated call back. You can also dial direct to be
entered to the call by an Operator (see "Via Telephone" details below).
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Via Telephone:
For those preferring to listen by telephone, please dial 416.764.8659 or toll-free 1.888.664.6392. To ensure
your participation, please call approximately five minutes prior to the scheduled start of the call.
Replay Archive:
Please dial 416.764.8677 or toll-free 1.888.390.0541, access code 971569#. The conference call replay
will expire on July 19, 2024.
The webcast, along with presentation slides, will be archived for 180 days on the Company's website.
Operating and Financial Parameters Highlights – 2022 LOMP, 2024 LOMP and 2024 PEA
The life of mine totals, from the second quarter of 2024 to the end of life, for the operating and financial
parameters of the 2022 LOMP, the 2024 LOMP and the 2024 PEA are set out in the table below.
The forecast parameters surrounding the 2024 PEA were based on a preliminary economic assessment,
which is preliminary in nature and includes inferred mineral resources that are too speculative geologically
to have economic considerations applied to them that would enable them to be categorized as mineral
reserves and there is no certainty that the forecast production amounts will be realized. The basis for the
preliminary economic assessment and the qualifications and assumptions made by the qualified persons
who undertook the preliminary economic assessment are set out in this news release. The results of the
preliminary economic assessment had no impact on the results of any pre-feasibility or feasibility study in
respect of Detour Lake.
Economic Assumptions
Gold Price $/oz $ 1,500 $ 1,900 $ 1,900
Exchange Rate USD:CAD 1.30 1.34 1.34
Effective Tax Rate (as % of free cash flow
before tax) % 26.7 % 27.7 % 28.7 %
Production
Mine Life 2052 2053 2054
Open Pit
Tonnes Mined Mt 736.2 755.7 755.7
Gold Grade g/t 0.77 0.77 0.77
Strip Ratio t:t 1.71 1.76 1.76
Underground
Tonnes Mined Mt — — 52.8
Gold Grade g/t — — 2.46
Mill Metrics
Mill Feed kt 781.2 818.6 871.5
Gold Grade g/t 0.75 0.75 0.85
LIFE OF MINE TOTALS
(All numbers are approximate) Unit
2022 LOMP 2024 LOMP 2024 PEA
Open Pit
Mill at 28 Mtpa
Open Pit
Mill at 28 Mtpa
Open Pit
Underground
Mill at 29 Mtpa
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Recovery % 91.6 % 91.3 % 92.2 %
Average Mill Throughput Mtpa 28.0 28.0 29.0
Gold production
Open Pit Moz 17.3 18.0 18.0
Underground Moz — — 4.0
Operating Costs
Minesite costs per tonne1 C$/t $ 21.8 $ 22.1 $ 24.9
Total Cash Cost*,1 $/oz $ 761 $ 752 $ 741
Capital Expenditures
Total Open Pit Development*,2 ($ millions) $ 1,550 $ 2,252 $ 2,252
Total Open Pit Sustaining*,2 ($ millions) $ 2,973 $ 3,601 $ 3,601
Total Underground Project Development2 ($ millions) $ — $ — $ 731
Total Underground Project Sustaining2 ($ millions) $ — $ — $ 631
Total Capital Expenditures2 ($ millions) $ 4,523 $ 5,852 $ 7,215
LIFE OF MINE TOTALS
(All numbers are approximate) Unit
2022 LOMP 2024 LOMP 2024 PEA
Open Pit
Mill at 28 Mtpa
Open Pit
Mill at 28 Mtpa
Open Pit
Underground
Mill at 29 Mtpa
Note: * Capitalized deferred stripping at Detour Lake was adjusted for the life of mine estimates following
the integration of Kirkland Lake Gold Ltd, which resulted in the reclassification of approximately $444
million from operating costs to capital expenditures in the 2024 LOMP when compared to the 2022 LOMP.
The major variances between the 2024 LOMP and 2022 LOMP include:
• Total gold production – Gold production increased by 4% or 0.7 million ounces of gold primarily
due to the replacement and identification of further open pit mineral reserves in 2022 and 2023
• Total cash costs per ounce – Total cash costs per ounce decreased by 1%, or $9 per ounce, as a
result of the reclassification of $444 million (approximately $26 per ounce) from operating costs to
capital expenditures, the assumption of a weaker Canadian dollar assumption, strong cost control
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1 Minesite costs per tonne and total cash costs per ounce are non-GAAP measures that are not
standardized financial measures under International Financial Reporting Standards ("IFRS"). For a
discussion of the composition and usefulness of certain of these non-GAAP measures and a reconciliation
of this historical measure to production costs, see "Reconciliation of Non-GAAP Financial Performance
Measures" and "Note Regarding Certain Measures of Performance" in the Company’s Management
Discussion & Analysis for the periods ended December 31, 2023 and March 31, 2024. Unless otherwise
indicated, but total cash costs per ounce are reported on (i) a per ounce of gold production basis, and (ii) a
by-product basis. For the years ended December 31, 2023 and December 31, 2022, the Company reported
minesite costs per tonne, total cash costs per ounce at the Detour Lake mine of C$26 and C$25, and $735
and $657, respectively.
2 Sustaining capital expenditures and development capital expenditures are non-GAAP measures that are
not standardized financial measures under IFRS. For a discussion of the composition and usefulness of
these non-GAAP measures and a reconciliation of these historical measures to production costs, see
"Reconciliation of Non-GAAP Financial Performance Measures" and "Note Regarding Certain Measures of
Performance" in the Company’s Management Discussion & Analysis for the periods ended December 31,
2023 and March 31, 2024. For the years ended December 31, 2023 and December 31, 2022, the Company
reported sustaining capital expenditures and development capital expenditures at the Detour Lake mine of
$249,765 and $214,060 and $172,903 and $180,072, respectively.
programs, partially offset by higher costs associated with three years of inflation
• Total Capital expenditures – Total capital expenditures increased by 25%, or $1,329 million ,
primarily due to the reclassification of $444 million in operating costs to capital expenditures,
increased maintenance costs associated with higher wear and tear at the mill of approximately
$162 million due to the higher throughput rate and the update in costs associated with three years
of inflation, partially offset by the assumption of a weaker Canadian dollar assumption
The major variances between the 2024 PEA and 2024 LOMP include:
• Total gold production – Gold production increased by 22% or 4.0 million ounces of gold primarily
due to the addition of production from the Underground Project
• Total cash costs – Total cash costs decreased by 1%, or $11 per ounce, as a result of higher gold
grades from the Underground Project and lower processing cost per tonne due to the increased in
mill throughput, partially offset by higher unit operating cost per tonne from the Underground
Project
• Total Capital expenditures – The increase in total capital expenditures of approximately $1,364
million reflect the development capital of approximately $731 million and the sustaining capital
expenditures of $631 million for the Underground Project and the mill optimization to 29 Mtpa
Overall, the inclusion of the large mineable mineral resource, increased mill throughput rate and higher
gold price environment contribute significantly to the increased economic value of Detour Lake, more than
offsetting inflationary cost increases since the 2022 LOMP.
The Underground Project and mill optimization provide the Detour Lake mine with the potential to transform
and grow annual gold production from approximately 700,000 ounces per year to approximately one million
ounces per year starting in 2030. Over the pre-production period of the Underground project, annual
average free cash flows 3 would be of approximately $115 million at an assumed gold price of $1,900 per
ounce and a USD:CAD exchange rate assumption of 1.34. The 2024 PEA provides that once the
Underground Project is in production, annual free cash flow generation would be expected to increase
significantly to an annual average of approximately $650 million. Once the open pit and underground mine
would be forecast to end operating in 2044, the mill would be expected to run for another 10 years
processing stockpiles. During that 10-year period, the site would be expected to remain a strong cash flow
generator with annual average free cash flow of approximately $280 million.
The Company believes that there is a good upside potential for additional exploration to add ounces to the
mine plan in future years, which could result in continued mine production and a resulting increase in
annual gold production in the period 2044 to 2054 or an extension of the life of mine.
The graph below provides a breakdown of the annual gold production in the 2024 LOMP and 2024 PEA
and shows the key operational and financial parameters over the main production phases of the 2024 PEA.
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3 Free cash flow is a non-GAAP measure that is not a standardized financial measure under IFRS. For a
discussion of the composition and usefulness of this non-GAAP measure, see "Note Regarding Certain
Measures of Performance" in this news release.
Updated MRMR Estimate at March 31, 2024
The MRMR estimate at Detour Lake has been updated to March 31, 2024, from the previously released
MRMR estimate at December 31, 2023 (see the Company's news release dated February 15, 2024). No
additional drill results were incorporated into this latest update, which used the same drill database as the
MRMR estimate at year-end, with a database closure date of October 16, 2023.
In contrast with the year-end 2023 MRMR estimate, the MRMR estimate at March 31, 2024 incorporates an
improved mineral resource model and includes high grade and low grade mineralized corridors factoring an
improved structural and geological understanding. The new mineral resource model provides more
flexibility and reliability in ongoing project studies and optimization efforts.
The parameters of the updated MRMR estimate are in the notes of the table below and in the Appendix.
The updated MRMR estimate as at March 31, 2024 and the variances to the estimate as at December 31,
2023 are set out in the table below. The variance between estimates largely illustrates the replacement of
lower grade ore that could be mined well into the future (primarily in the measured mineral resource and
indicated mineral resource categories) with higher grade ore amenable to underground mining in the nearer
term (primarily in the inferred mineral resource category).
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As at March 31, 2024 As at December 31, 2023 Variance
Category Tonnes
(000s)
Gold
Grade
(g/t)
Contained
Gold
(000 oz)
Tonnes
(000s)
Gold
Grade
(g/t)
Contained
Gold
(000 oz)
Contained
Gold
(000 oz)
Mineral Reserves
Total Proven &
Probable1 818,621 0.75 19,672 819,049 0.76 19,928 -256
Mineral Resources
Measured and
Indicated Low Grade2 647,093 0.58 12,116 728,681 0.77 17,955
Measured and
Indicated High Grade3 19,025 1.93 1,183 — — —
Total Measured &
Indicated 666,118 0.62 13,299 728,681 0.77 17,955 -4,656
Inferred Low Grade2 27,798 0.54 483 58,317 0.62 1,156
Inferred High Grade3 107,658 2.05 7,085 21,801 2.23 1,561
Total Inferred 135,456 1.74 7,568 80,127 1.05 2,717 4,851
Notes:
1. Proven and Probable mineral reserves are reported at a cut-off grade of 0.30 g/t gold.
2. March 31, 2024 low grade mineral resources are reported at a cut-off grade of 0.25 g/t gold. December 31, 2023 low grade mineral
resources are reported at a cut-off grade of 0.30 g/t gold inferred mineral resources are undiluted
3. High-grade mineral resources are reported at a cut-off grade of 1.22 g/t gold.
The main variances in the MRMR estimate are set out below:
• Mineral Reserves – The slight decline of 0.26 million ounces of gold in the March 31, 2024
estimate, compared to the December 31, 2023 estimate, is primarily due to mining depletion
totalling 171,000 ounces of in situ gold
• Measured and Indicated Mineral Resources – The decline of 4.7 million ounces of gold (or 26%)
in the March 31, 2024 estimate compared to the December 31, 2023 estimate is primarily due to
the updated open pit costs leading to a shallower mineral resource pit, offset partially by an
optimized cut-off grade. The variance is also explained by a local reclassification of indicated
mineral resources within the high-grade corridors to inferred mineral resources where tighter drill
spacing is required to return these areas to indicated mineral resources that could be potentially
mined by underground methods. The decline in measured and indicated mineral resources is
partially offset by the initial declaration of an underground indicated mineral resource totalling 0.7
million ounces of gold (10 million tonnes grading 2.0 g/t gold) at March 31, 2024
• Inferred Mineral Resources – The increase of 4.9 million ounces of gold (or 179%) in the March
31, 2024 estimate, compared to the December 31, 2023 estimate is primarily due to the mineral
resource reclassification within the pit resource and the addition of underground inferred mineral
resource below the shallower resource pit
• The proportion of underground mineral resources has increased in the March 31, 2024 estimate,
compared to the December 31, 2023 estimate, as they are now being reported below a shallower
resources pit. Future exploration, conversion drilling, bulk sampling and geological and structural
studies are expected to improve and add evidence of high-grade continuity in the next iterations of
the Detour Lake model
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