Iamgold will secure roughly US$282 million from the sale of its African assets to fund the construction of Côté Gold. Courtesy of Iamgold.

Iamgold revealed last August it would need more money than initially expected to complete its Côté Gold project in Ontario. On Dec. 19, Iamgold shared that the project, jointly owned 70/30 with Sumitomo Metal Mining, had secured the needed funding for the project to continue development and meet its revised early-2024 production target.

Sumitomo will contribute approximately US$340 million to the project over the next year. In return, Iamgold will offer the company roughly 10 per cent further interest in Côté Gold.

The agreement will have Sumitomo provide up to US$250 million to fund ongoing construction in exchange for expanded interest in the project. Once the US$250 million limit has been reached, each party will contribute funds based on their revised ownership stake in the project towards construction costs, which for Sumitomo is estimated at US$90 million.

Iamgold will have the option to repurchase the transferred ownership stake in the future. According to board chairman and interim president and CEO Maryse Bélanger, Iamgold intends to return to its original 70 per cent stake once the company has improved its liquidity.

Sumitomo president and representative director Akira Nozaki said “the Côté Gold project has the potential to become a world-class, low-cost, long-life gold mine, and is one of the major pillars of Sumitomo Metal Mining’s growth strategy…. We believe that this transaction will further strengthen the friendly relationship between Iamgold and [Sumitomo], while ensuring that the construction of this project will proceed without delay and secure the early start-up of operations.”

Iamgold also announced the sale of its 90 per cent-stake in the Senegal-based Boto Gold project, the Diakha-Siribaya gold project in Mali, the Karita gold project and other associated exploration locations based in Guinea, as well as any other early-stage exploration locations of the aforementioned projects, to Moroccan-based company Managem for roughly $US282 million.

"The proceeds of the sales, coupled with the financing agreement with Sumitomo announced last night, meet the remaining funding requirements for completion of construction at the Côté Gold Project, which is approximately 70 per cent complete and on track for production in early 2024,” said Bélanger.

The anticipated capex was US$1.3 billion when construction was approved in 2020, but in August, with the project nearly 60-per cent complete, Iamgold estimated it would need US$1.9 billion to see construction through. Once producing, the mine is expected to average 365,000 ounces of gold per year over 18 years.