1.0 Introduction and Purpose of Undertaking The DLPP proposes to re-connect the Detour Lake site to the provincial electrical grid. 1.0 INTRODUCTION AND PURPOSE OF UNDERTAKING 1.1 Introduction Detour Gold Corporation (Detour Gold) has been exploring the previously developed Detour Lake mineral property since 2007. The Detour Lake property is located approximately 185 kilometres (km; by road) northeast of Cochrane in northern Ontario (Figure 1-1). The Detour Lake deposit was discovered in 1974 and was operated by another mining company from 1983 to 1999. Power was provided to this mine by a 115 kilovolt (kV) transmission line connection to the Ontario electrical grid at Island Falls. Detour Gold proposes to construct, operate and eventually close a new open pit gold mine, the Detour Lake Project at the site. Detour Gold has completed a positive pre-feasibility engineering study for the Detour Lake Project and is nearing completion of a feasibility study. Engineering work to date indicates that the Detour Lake Project will require approximately 120 megawatts (MW) of power for construction and operation. The Detour Lake site is no longer connected to the electrical grid and activities are constrained by the current availability at site of less than 1 MW of diesel generating power. A dependable power supply is required to construct and operate the proposed open pit gold mine. 1.2 Purpose of the Undertaking Detour Gold is proposing to re-connect the Detour Lake site with the Ontario electrical grid (the Detour Lake Power Project; DLPP). Detour Gold is not in the business of power generation or power transmittal and the transmission line is intended solely to meet the needs of the proposed mine. The purpose of the undertaking is therefore to: construct a new 230 kV transmission line connecting the Detour Lake site with the Ontario electrical grid at the Pinard Transformer Station, located west of Fraserdale, Ontario. Power was provided to the previous mine at the Detour Lake site by means of a 115 kV transmission line from Island Falls. The proposed Detour Lake Project has greater power requirements than the mine that previously operated at the Detour Lake site. Consideration was given within the approved Terms of Reference (ToR), as to whether a 115 kV connection to the electrical grid could reliably supply the quantity of power required for the Detour Lake Project. During engineering investigations for the Detour Lake Project it was determined that insufficient reliable power would be provided by this means. There was the potential that the starting and stopping of large motors powered through a 115 kV system could destabilize the electrical grid or damage sensitive equipment when in full production. For this reason, the undertaking considers a 230 kV connection. The closest connection point for a 230 kV transmission line is at the Pinard Transformer Station (TS) near Fraserdale, Ontario. Other connection points are further away and offer no advantage, as sufficient capacity is available at Pinard. DETOUR LAKE POWER PROJECT Page 1 Individual Environmental Assessment 230 kV Transmission Line Power Supply Through the ToR process, only connection to the Ontario electrical grid was determined to have the ability to meet the needs of the Detour Lake Project. Alternative means of supplying power to the mining project considered within the approved ToR but determined to be unacceptable were: • On-site diesel fired generation; • On-site natural gas fired generation; • Run of river hydroelectric; • Other alternative forms of energy (solar, wind, forest biomass); and • Conservation. On-site diesel generation is not considered practical under any engineering scenario given the quantity of power required. The necessary power plant would comprise a large number of generators and large onsite tankage for fuel storage, as well as considerable transport of fuel along a remote provincial highway (Highway 652) and access road. Fuel usage for on-site diesel fired generation for the operations phase of the Detour Lake Project is estimated as being in the in the order of 200 million litres per year. While Highway 652 is a multi-purpose road which is well maintained and is open year round, the volume of tanker trucks required could pose a conflict to existing local traffic, including forestry vehicles and proposed mine traffic. Burning of this quantity of diesel fuel would also impart considerable greenhouse gases (GHG) to the atmosphere. A new natural gas pipeline and co-generation facility would have to be constructed to support the natural gas fired power generation at the Detour Lake Project. The remoteness of the Detour Lake Project site does not support any longer term use for a co-generation plant. An entirely new right-of-way (ROW) from Cochrane with associated infrastructure would be required. A considerable length of the pipeline could potentially parallel the existing road network including Highway 652, although in some areas, there is insufficient space between the existing road and waterbodies and a new cross-country ROW would be needed. There are no potential hydroelectric sites capable of producing at least 120 MW closer to the Detour Lake Project site than the Pinard TS. Construction of a new hydroelectric generating station and a transmission line to more distant location is not justified; would not be financially supportable by the Detour Lake Project; and would have greater unnecessary adverse environmental effects compared with the grid connection to the Pinard TS. Solar, wind and forest biomass power supply alternatives were also reviewed within the proposed ToR. These alternatives sources can not deliver reliable power at the scale required. Wind power cannot consistently deliver reliable power under any practicable development scenario, irrespective of nameplate capacity. Technologies such as solar photovoltaic, fuel cells and micro-turbines are in research and development stages and would not be practical for a large scale mining operation in a northern Ontario setting. Forest biomass is also not feasible at the scale needed. DETOUR LAKE POWER PROJECT Page 2 Individual Environmental Assessment 230 kV Transmission Line Power Supply Conservation is not a realistic power alternative and is unacceptable, as the Detour Lake Project is a new facility, and energy efficiency is being considered in the facility design and equipment selection. 1.3 Environmental Assessment Approach The DLPP is a proposed transmission line of more than 50 km length with a voltage of between 115 kV and 500 kV. As a result, a Category C Individual Environmental Assessment (EA) is required, pursuant to the Electricity Projects Regulation (O.Reg. 116/01; MOE 2001). The planning stage for the DLPP is well advanced and the only feasible proposal for increasing the power supply has been determined. For these reasons, the EA will be completed in accordance with Sections 6(2)(c) and 6.1(3) of the Environmental Assessment Act. It will follow the generic requirements of subsection 6.1(2) but will focus on the transmission of power to site from the provincial electrical grid by means of a 230 kV transmission line. In accordance with the approved ToR, the Individual EA document will not assess all alternatives to the undertaking (such as alternative power sources) or all alternative means (including the routing of the DLPP; AMEC 2009a). Through the development, consultation and approval of the ToR for the DLPP, the framework for the EA development was narrowed to a limited but justified number of alternatives to be considered within the EA document. For this reason, alternatives such as the development of the preferred DLPP routing, primarily utilizing and expanding on existing and historic ROWs already present, is not considered herein. A copy of the approved ToR which provides details regarding other alternatives considered and the framework for this EA document is provided in Appendix A. Detour Gold has retained AMEC Earth & Environmental (AMEC) to prepare documentation related to the Individual EA process and to assist in the associated consultation process. In accordance with Regulation 344 of the Environmental Assessment Act, the EA document is to contain: • A list of studies and reports which are under the control of the proponent and which were done in connection with the undertaking or matters related to the undertaking. • A list of studies and reports done in connection with the undertaking or matters related to the undertaking of which the proponent is aware and that are not under the control of the proponent. These are provided in Appendix B. DETOUR LAKE POWER PROJECT Page 3 Individual Environmental Assessment 230 kV Transmission Line Power Supply 1.4 Document Structure The Individual EA document has been structured as follows: Section 1: Introduction and Purpose of Undertaking Section 2: Identification of the Proponent Section 3: Regulatory Framework Section 4: Terms of Reference Requirements Section 5: Description of the Undertaking Section 6: Existing Conditions Section 7: Assessment of Alternatives Section 8: Environmental Effects and Mitigation Measures Section 9: Consultation Plan and Consultation to Date Section 10: Flexibility to Accommodate New Circumstances Section 11: Other Approvals Required Section 12: Commitments and Monitoring Section 13: References Appendices DETOUR LAKE POWER PROJECT Page 4 Individual Environmental Assessment 230 kV Transmission Line Power Supply 300000 P:\EM\Projects\2008\TC81510 2008 Detour Gold Project\GIS_Data\TransmissionLine_EA\SD_Maps\MXD_Maps\ProjectLocation.mxd LEGEND . ! KEY MAP . ! 0 25 50 75 100 12512.5 Hearst Regional Road/Highway/Access Road Provincial Border First Nation Community Regional Communities Proposed Transmission Line Route Area Enlarged 620 H w 350000 y km 1 1 Kapuskasing Flying Post 73 ^_ Smooth Rock Falls 400000 . ! Pinard Kilometres 450000 Timmins . ! ^ _ H w . ! Fraserdale y Projection: UTM Zone 17N Datum: NAD83 - Base data from GeoGratis, NOTES: (NTDB), 1:250,000 vector sheets. National Topographic Database 1 1 . ! 655 Hwy (Taykwa Tagamou) New Post 69 Island Falls A b it Moosonee ib Night Hawk i 500000 Frederick R .