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Iamgold meets guidance, says Cote decision expected in Q1

17th January 2019

By: Mariaan Webb

Creamer Media Senior Deputy Editor Online

     

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Midtier miner Iamgold produced 231 000 oz in the fourth quarter of 2018, bringing the year’s production to 882 000 oz, comfortably meeting its guidance of 850 000 oz to 900 000 oz.

In a preliminary production announcement, the company said on Wednesday that it had a record production year at its Essakane mine, in Burkina Faso, which produced 405 000 oz in the year.

Total cash costs for the year are forecast to be at the high-end of the guidance of $750/oz to $800/oz and all-in sustaining costs (AISC) are forecast to be near the high-end of the guidance of $990/oz to $1 070/oz.

For 2019, the miner is forecasting production of between 810 000 oz and 870 000 oz, with owner-operator production expected to remain flat, while the Sadiola mine, in Mali, is expected to deplete its oxide stockpiles in the first half of the year.

Following two years of record output at Essakane, production is forecast to be lower than in 2018, owing to lower availability of high-grade zones, partially offset by higher recoveries resulting from the positive impact of the newly commissioned oxygen plant.

At Rosebel, in Suriname, production will be higher than the 287 000 oz produced in 2018, owing to the inclusion of Saramacca ore in the second half of the year. Westwood production is forecast to be between 100 000 oz and 120 000 oz.

The AISC guidance for 2019 is set at $1 030/oz to $1 080/oz. Iamgold is building a growth pipeline and is aiming to produce between 1.2-million and 1.3-million ounces a year by 2020, at an AISC of below $850/oz.

The company said that it would announce an investment decision for the $1.15-billion Côté project, in Canada's Ontario, in the first quarter of this year. A November 2018 feasibility study for the joint venture project with Sumitomo Metal Mining demonstrated its economical and technical viability.

The base case is for a 36 000 t/d operation producing 367 000 oz/y over a 16-year mine life at an AISC of $694/oz.  An extended mine plan adds two years to the base case mine plan, increasing production to 372 000 oz/y at an AISC of $703/oz.

The base case has an after-tax net present value (NPV) of $795-million and an internal rate or return (IRR) of 15.2%, with a payback period of 4.4 years. The extended mine plan scenario increases the NPV by $10-million to $905-million and improves the IRR to 15.4%.

Edited by Creamer Media Reporter

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