en.Wedoany.com Reported - Iamgold (TSX: IMG; NYSE: IAG) reported a resource update for its Côté gold mine in northeastern Ontario, showing a 12% increase in contained gold ounces by incorporating the adjacent Gosselin deposit.
The company stated in a release that measured and indicated resources at Côté now total 838.8 million tonnes at a grade of 0.75 grams per tonne, containing 20.34 million ounces of gold, up from the 18.2 million ounces estimated as of December 31. Inferred resources jumped 61% to 177.1 million tonnes at a grade of 0.61 grams per tonne, containing 3.48 million ounces of gold.
National Bank Financial mining analyst Mohamed Sidibé said in a note that the update is positive due to a larger, higher-confidence resource inventory for mine planning in the fourth-quarter technical report, and the first integrated Côté-Gosselin resource model. However, he noted that the technical report remains a key item, with factors such as reserve conversion, mine sequencing, permitting, throughput rates, capital expenditures, strip ratios, and tailings assumptions determining how much of the expanded resource base enters the mine plan.
The resource update comes as the company works to complete an expansion technical report and updated mine plan, expected by year-end. Iamgold said the update better defines the mineralization geometry and continuity of the combined Côté and Gosselin deposits, based on extensive diamond drilling and refined geological interpretation.
Toronto-based Iamgold is advancing a plan to expand the Côté plant's capacity by 40% to over 50,000 tonnes. The company expects attributable gold production from Côté this year to be between 270,000 and 310,000 ounces, compared to 279,900 ounces last year.
The Côté mine, located near Gogama about 175 km northwest of Sudbury, achieved commercial production in August 2024 and quickly became one of Canada's largest new gold mines. Iamgold operates the mine in a 70-30 joint venture with Japan's Sumitomo Metal Mining.
The updated data shows measured and indicated resources of 12.76 million ounces at the Côté deposit, compared to 7.43 million ounces at Gosselin. The combined model also delineated additional gold ounces in the saddle zone connecting the two deposits.
Key changes in the update include a higher gold price assumption. Iamgold now uses a price of $2,500 per ounce and a cut-off grade of 0.25 grams per tonne, replacing the previous assumptions of $2,100 per ounce for Côté and $2,500 per ounce for Gosselin, along with a cut-off grade of 0.30 grams per tonne.
TD Cowen mining analyst Steven Green said the resource increase enhances Iamgold's appeal to larger industry competitors. Green stated in a note that the company remains a potential M&A target as Côté develops into one of the industry's largest ongoing projects. RBC Capital Markets estimates that Côté accounts for approximately 67% of Iamgold's net asset value.
Iamgold said the Côté team plans to complete another 30,000 metres of diamond drilling this year, with the next phase aimed at infill drilling and testing the potential to further expand the mineralization envelope in preparation for 2027. Additionally, the company has identified several regional targets within its land package, including Jerome, Northshore, and Monella Point, supporting the view that the broader Côté gold district has potential for additional deposits that could supplement existing operations if successfully developed.
On Monday morning, as the broader market declined, Iamgold shares fell 5.8% to C$23.50 in Toronto, valuing the company at approximately C$13.6 billion (US$9.9 billion). The stock has traded in a range of C$9.22 to C$34.09 over the past year.
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