All amounts are in US dollars, unless otherwise indicated.
TORONTO, June 5, 2017 /CNW/ - IAMGOLD Corporation ("IAMGOLD" or the "Company") today announced positive results from a Prefeasibility Study ("PFS") for its Côté Gold Project (Project) in Northern Ontario. The results, which outline an economically viable project and confirm the development concept previously set out in the Preliminary Economic Assessment, clear the way for the Company to initiate a feasibility study and to support the permitting process. Coinciding with this news release the Company also announced a partnership with Sumitomo Metal Mining in which they will acquire a 30% participating interest in the Côté Gold Project.
Steve Letwin, President and CEO of IAMGOLD, said "The robust project economics generated from the PFS further validates our view that Côté Gold is an exceptional organic growth project, particularly when our industry faces a shortage of undeveloped gold deposits in attractive mining jurisdictions with surrounding infrastructure. This is a project with low operating costs and an attractive rate of return, that's expected to deliver 320,000 ounces a year for 17 years. The conversion of nearly six million ounces from resources to reserves on a project basis and over 3.8 million ounces attributable to IAMGOLD, representing an overall increase in our attributable consolidated reserves by 49%1, stands out in an industry challenged with reserve replacement. Additionally, Côté has significant exploration upside potential with more than 500-square kilometres of exploration rights-held property surrounding the deposit. We are looking forward to working with Sumitomo to advance the Côté Gold Project towards development."
The PFS was completed jointly by IAMGOLD, Amec Foster Wheeler (Amec), and Roscoe Postle Associates Inc. (RPA), with inputs from technical studies completed by other consultants. The PFS represents a comprehensive study of the technical and economic viability of a mineral project that has advanced to a stage where a preferred mining method is established and an effective method of mineral processing is determined.
A technical report summarizing the PFS will be filed on SEDAR within 45 days of the date of this news release.
1 Based on IAMGOLD's 2016 year-end reserves of 7.8 million ounces and the Company's attributed reserves of 3.8 million ounces from the Côté Gold Project (based on IAMGOLD's 64.75% [70% x 92.5%] working interest in the Côté Gold Project).
*excludes deferred initial capital attributable to equipment leasing of $116M, net of down payments and leasing payments.
The RPA Mineral Resource estimate used as the basis for the study is summarized below.
CIM Definition Standards were followed for classification of Mineral Resources.
Mineral Resources are reported at a cut-off grade of 0.30 g/t Au.
Mineral Resources are estimated using long-term gold price of $1,500 per ounce, and a US$/C$ exchange rate of 1:1.25.
Bulk density varies from 2.69 t/m3 for tonalite to 2.75 t/m3 for diorite, and 2.93 t/m3 for diabase.
The tonnes, grades, and classification of the Mineral Reserves captured within the PFS mine plan are summarized below.
Treatment and refining costs, including transport and selling cost, estimated to be $4.00/oz Au.
Variable royalty percentages by zone: 0.75% for zone 1, 1.00% for zone 2, 0.00% for zone 3, 1.50% for zone 4, 0.75% for zone 5, 1.50% for zone 6, 0.75% for zone 7, and 0.75% for zone 8. Only zones 2, 3, 5 and 6 have Mineral Reserves.
Processing costs: $8.77/t. Include process cost: $6.58/t, G&A: $1.45/t, Sustaining: $0.57/t, Closure: $0.18/t.
Mining costs: $1.93/t incremented at $0.035/t/12 m below 388m elevation. Average mining cost: $2.39/t. Rehandling cost $0.84/t.
Open pit mining includes 40 Mt extracted during the two year pre-production period followed by 16 years of production mining. Stockpile reclaim extends the operation into Year 17. The amount of rehandled mill feed over the life of the operation is 42 Mt. The average grade scheduled is 0.94 g/t Au and the LOM stripping ratio is 2.85:1.
Life of mine total cash costs are estimated at $605/oz of gold produced and all-in sustaining costs at $689/oz of gold sold.
Initial Capital costs are estimated at $1,047 million, life-of-mine Sustaining Capital costs are estimated at $418 million, and Closure costs are estimated at $40 million, with details below. Costs assume leasing of the mine production fleet and some other major equipment components.
* total cost of capital leases (initial + sustaining) including financing costs, excluding down payments.
The PFS recommended the completion of a feasibility study to validate and detail the elements of the development concept set out in the PFS, and which would include additional drilling, stripping, engineering studies and environmental studies, including hydrological, hydrogeological and geotechnical analyses. The recommended feasibility study is expected to be completed in the second half of 2018. In addition, we continue to conduct exploration activities within our more than 500-square-kilometre property surrounding the Côté Gold deposit, the objective being to develop and assess targets that could further maximize our flexibility with respect to future development decisions.
Other scientific and technical information in this news release has been reviewed and approved by Geoffrey Chinn M.Sc.(A)., P.Geo., IAMGOLD, Project Manager, a Qualified Person under the terms of National Instrument 43-101. Mr. Chinn has verified the technical data disclosed in this news release.
IAMGOLD technicians and geologists on site follow a sample preparation protocol to ensure quality control before sending samples to the assay laboratory. Most of the drill holes are sampled at one-metre intervals and consist of one-half the drill core. Sample intervals are tagged by the geologist. All sample intervals are logged with a unique number in a sample book by the geologist. The borehole number and sample interval are transferred to one of the tags and recorded in the logs. One tag is placed in a plastic sample bag with the sample and the second is stapled in the core box beneath the remaining representative half core sample. During this procedure, the location for the insertion of certified reference material and blanks into the sample sequence is noted. Core is sawed by geotechnicians following the orientation line drawn by the geologist. The entire length of a drill hole is sampled, except, diabase dykes that occur within the sequence are not sampled, aside for two one-metre shoulder samples at the upper and lower contacts. The remaining half of the core is stored in racks at the core farm facilities located on site.
For quality assurance/quality control (QA/QC) purposes, IAMGOLD inserts control samples after every twelfth sample interval. The control samples consist either of a certified reference material (CRM) or a blank sample. IAMGOLD inserts control samples as a standard procedure. The primary laboratory sets aside the pulp from one out of every 10 samples to be sent to a second laboratory as a check assay. Between 2012 and 2014, check assays were completed at ActLabs, Ancaster, Ontario. During the 2015 drilling campaign, check assays on pulps were completed by ALS Minerals, Val d'Or, Quebec. All of the samples were analyzed using the FA-AA method. Samples that assayed above the maximum limit using FA-AA were re-analyzed with the FA-Gravimetric method.
an inspection of the core farm, core shack, and specific outcrops of the Côté Gold Project.
Status on legal and assessment work requirements for the maintenance of the Côté Gold district exploration properties portfolio and updates.
Reviewed geology of stripped outcrops within the conceptual pit boundary.
The logging, sampling procedures, and data entries were completed to industry standards. It is the QP's opinion that the database is adequate to support a Mineral Resource estimate on the Côté Gold deposit.
Mr. Tony Lipiec, P. Eng., has been involved in supervising the Côté Gold testwork since October 2016 and has visited the laboratories performing the work. He visited the facilities at the University of British Columbia in Vancouver, Canada on January 16, 2017. He also visited and reviewed work performed at COREM in Quebec City, Canada on March 9-10, 2017.
Proposed location of open-pit, mine rock area, mill feed stockpile, topsoil/overburden storage, tailings management facility, property access, mine facilities, utility corridors, water management structures.
Ms. Debbie Dyck, P. Eng., has been involved in the Côté Gold Project baseline studies and EA process since 2012, and last visited the site on April 13-14, 2017.
A conference call will be held on Tuesday, June 6, 2017 at 8:30 a.m. (Eastern Daylight Time) for a discussion with management regarding the IAMGOLD-Sumitomo transaction and highlights from the Côté Gold prefeasibility study. A webcast of the conference call will also be available through IAMGOLD`s website - www.iamgold.com.
Conference Call Information: North America Toll-Free: 1-800-319-4610 or 1-604-638-5340.
A replay of this conference call will be accessible for one month following the call by dialing: North America toll-free: 1-800-319-6413 or 1-604-638-9010, passcode: 1490#.
All Mineral Reserve and Mineral Resources estimates reported by the Company were estimated in accordance with the Canadian National Instrument 43-101 and the Canadian Institute of Mining, Metallurgy, and Petroleum Definition Standards (May 10, 2014). These standards differ significantly from the requirements of the U.S. Securities and Exchange Commission. Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability.
estimates of operating costs and total costs, net cash flow, net present value and economic returns from an operating mine.
Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives or future events or performance (often, but not always, using words or phrases such as "expects", "anticipates", "plans", "projects", "estimates", "envisages", "assumes", "intends", "strategy", "goals", "objectives" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements.
the fulfillment of environmental assessment commitments and arrangements with local communities.
Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Many forward-looking statements are made assuming the correctness of other forward looking statements, such as statements of net present value and internal rates of return, which are based on most of the other forward-looking statements and assumptions herein. The cost information is also prepared using current values, but the time for incurring the costs will be in the future and it is assumed costs will remain stable over the relevant period.
By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that estimates, forecasts, projections and other forward-looking statements will not be achieved or that assumptions do not reflect future experience. We caution readers not to place undue reliance on these forward-looking statements as a number of important factors could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates assumptions and intentions expressed in such forward-looking statements. These risk factors may be generally stated as the risk that the assumptions and estimates expressed above do not occur as forecast, but specifically include, without limitation: risks relating to variations in the mineral content within the material identified as Mineral Resources and Mineral Reserves from that predicted; variations in rates of recovery and extraction; the geotechnical characteristics of the rock mined or through which infrastructure is built differing from that predicted, the quantity of water that will need to be diverted or treated during mining operations being different from what is expected to be encountered during mining operations or post closure, or the rate of flow of the water being different; developments in world metals markets; risks relating to fluctuations in the Canadian dollar relative to the US dollar; increases in the estimated capital and operating costs or unanticipated costs; difficulties attracting the necessary work force; increases in financing costs or adverse changes to the terms of available financing, if any; tax rates or royalties being greater than assumed; changes in development or mining plans due to changes in logistical, technical or other factors; changes in project parameters as plans continue to be refined; risks relating to receipt of regulatory approvals; delays in stakeholder negotiations; changes in regulations applying to the development, operation, and closure of mining operations from what currently exists; the effects of competition in the markets in which IAMGOLD operates; operational and infrastructure risks and the additional risks described in IAMGOLD's Annual Information Form filed with SEDAR in Canada (available at www.sedar.com ) for the year ended December 31, 2016 and in the Corporation's Annual Report Form 40-F filed with the U.S. Securities and Exchange Commission on EDGAR (available at https://www.sec.gov/edgar/searchedgar/companysearch.html. IAMGOLD cautions that the foregoing list of factors that may affect future results is not exhaustive.
When relying on our forward-looking statements to make decisions with respect to IAMGOLD, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. IAMGOLD does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by IAMGOLD or on our behalf, except as required by law.