TORONTO (miningweekly.com) – Toronto-based Iamgold expects its Westwood project, in Quebec, to cost $401-million, including money already spent, the company said on Monday.

Iamgold has completed an updated preliminary assessment for the project, and confirmed that it aims to start production at the mine in early 2013.

Westwood is expected to produce about 186 000 oz/y of gold at an average cash cost of $358/oz over a 16-year mine life.

Costs have increased from a 2008 preliminary assessment, in which they were estimated at $298/oz, mainly because of exchange-rate movements, Iamgold said.

In the first five years of production output is forecast at 191 000 oz/y, at average cash costs of $352/oz.

Iamgold said still expects 2009 spending on the project to come in at $86-million and has forecast capital spending of $102-million next year.

"Westwood is an important component of Iamgold's growth strategy," said CEO Joseph Conway.

"The strength and experience of our team in the region and our established infrastructure continues to be an advantage and has driven the project forward on schedule and on budget."

Westwood is located about two kilometers from Iamgold's Doyon mine in Quebec.

During 2009, the company made progress on site preparation and infrastructure construction, including the head frame, hoist room building and the installation of two hoists for the exploration shaft, as well as ongoing exploration work.

The shaft sinking began in July and is expected to reach 500 m by year end, Iamgold said.

By the end of 2010, the shaft sinking is forecast to reach 1 300 m, and the company expects to have completed 11 00 m of lateral and vertical excavation development work.

Production and service hoists will be installed and the surface facilities will be completed, the company will take another 2 000-t bulk sample to test mining methods and about 41 000 m of valuation and definition drilling should be completed next year.

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