Iamgold (TSX: IMG; NYSE: IAG) is a step closer to buying back the 9.7% interest in its Côté gold mine in Ontario from Sumitomo Metal Mining, after issuing a 60-day notice to exercise its repurchasing right.
The move will increase Iamgold’s stake in the mine, which will be Canada’s third-largest gold operation once at full tilt, to 70%. In the first six years of production, Côté’s expected to churn out 495,000 oz. gold per year. Over the life of the mine, it will average 365,000 oz. per year.
Located 125 km southwest of Timmins, Ont., Côté produced its first first doré bar in April, achieving commercial production in August this year.
The asset is currently owned as a joint venture set in December 2022 between the Toronto-based miner and Sumitomo. At the time, the company faced financial hurdles, so it sought a loan from the Japanese miner to complete construction. As a result, Sumitomo’s stake in Côté increased from 30% to 40%. The loan agreement allowed Iamgold to buy back its 70% interest within a specified period.
In May, Iamgold announced it had secured US$300 million in funding that would be used to repurchase the 9.7% interest from its partner.
Total gold production from Côté this year is expected to be in the range of 220,000-290,000 oz. as improvements to mill availability are made during the ramp-up of operations. Iamgold’s share in the mine is anticipated to be on the lower end of 130,000-175,000 ounces.
The company reiterated the mine was on track to reach 90% throughput by the end of the year.
In addition to Côté, Iamgold operates two other mines — Essakane in Burkina Faso and Westwood in Quebec.
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