The cost to finish IAMGOLD’s troubled Côté gold mine project will be close to $2 billion.
The Toronto gold company released a project update on the Gogama-area open-pit development project in the wake of a thorough project review started last March.
In May, company management estimated it would take more than a billion dollars to complete construction and bring it into production. A new technical report issued by IAMGOLD now places that figure at $1.9 billion.
The costs that are attributable to IAMGOLD are estimated at $1.2 to $1.3 billion, as of July 1.
Sumitomo Metal Mining of Japan is a 30 per cent partner with IAMGOLD at Côté.
Construction is just past the halfway mark at 57 per cent.
At the beginning of the year, gold production was scheduled to start at the halfway of 2023. It’s now been pushed back to early 2024.
Since the turn into the new year, the project has been hammered by a perfect storm of setbacks with an outbreak of COVID among its earthworks contractors that slowed the pace of construction, inflation impacting the cost of parts and consumables, global supply chain issues, a February fire that destroyed a concrete batch plant, and even a brief strike among crane operators on site.
Last spring, with construction costs rapidly escalating, the company appointed a new project manager to work with the contractor, EPCM, to do the review, a risk analysis and deliver an updated mine plan.
In an Aug. 3 statement, interim president-CEO Maryse Bélanger said these new costs and schedule “give us greatly improved visibility toward completion.”
“Côté Gold is a project that is being advanced in an environment with significant headwinds, including COVID-19, inflation and other global events - and their impacts on global supply chains, labour availability, and the associated costs of doing business,” she added.
“We are very proud of our teams as they navigate these challenges to continue to advance the project for the benefit of our partners, stakeholders and our business.”
There’s also been some shuffling in the front office with CEO Gordon Stothart departing earlier this year, movement on the board of directors, and project management turnover on the ground at Gogama. Bélanger, the former president of Atlantic Gold Corp., is helping to project manage Côté until a new president is chosen.
The Côté project is situated just off Highway 144 in the Gogama area. It is 175 kilometres north of Sudbury and 125 kilometres south of Timmins. The sod-turning to start construction was in September 2020.
Côté’s mine life is estimated at 18 years based on mineral reserves of 7.2 million ounces in the main deposit.
The company stands by Côté as a “transformational” project due to its "tremendous" exploration upside based on the gold potential of a nearby deposit, dubbed Gosselin, which contains 3.4 million ounces in an indicated mineral resource.
Senior management will host a conference call Aug. 4 at 8:30 a.m. to discuss Côté Gold and their second quarter 2022 operating performance and financial results.
Besides the Côté Gold project, IAMGOLD runs mines in Burkina Faso, in Suriname and northwestern Quebec with its Westwood Gold Mine between Rouyn-Noranda and Val d’Or.