TORONTO (miningweekly.com) – The Essakane gold project, in Burkina Faso, is moving towards commercial production in August ahead of schedule and within budget, Iamgold interim CEO Peter C Jones reported on Wednesday.
Completion of the $443-million project, which Iamgold bought in 2009 by acquiring Orezone Resources, is a key milestone for the firm, he said.
Iamgold started out as a minority joint venture partner on gold mines in West Africa with South Africa's AngloGold Ashanti, but acquired some operations of its own in a C$1,3-billion acquisition of fellow Canadian Cambior Mining in 2006.
“Essakane is really the story on 2010 for us,” Jones said on a conference call.
“The start of Essakane later this year will further solidify Iamgold as a company that can acquire, develop, and run operations well.”
Iamgold announced last year that it would bring the target date for commercial production at Essakane forward, to August 2010, compared with an earlier forecast of year-end, and the project is now several months ahead of the original schedule and on budget.
“All the major construction milestone have been met, and we are confident in our estimated August commercial production date,” Jones said.
The mills, trucks, crusher and generators are all on site and installed or being installed, earthworks are substantially complete, structural steel construction is on track and approximately 80% complete and the equipment, piping and electrical is on site and being installed.
Iamgold has also announced a 1,1-million increase in reserves at Essakane, and exploration teams are optimistic about further growth.
The company is focused on "aggressive" organic growth, as it seeks to take advantage of high gold prices and offset declining output from its Doyon mine, in Quebec and Mupane in Botswana. The firm closed another Quebec mine, Sleeping Giant, in 2008.
Once the new Essakane mine is in production and ramping up, Iamgold's next internal growth milestone will be the Sadiola deeps sulphide project, in Mali, which is due to start up in mid-2012, then the Westwood project, in Quebec, in early 2013, followed by Quimsacocha, in Ecuador.
The Westwood project is also on schedule and on budget, Jones said.
The shaft was advanced to 500 meters by the end of 2009 and the head frame steel structure was completed, along with many surface infrastructure buildings. Iamgold expects the Westwood shaft to reach 1 300 m by the end of 2010.
At Quimsacocha, the firm has continued working on engineering for the concentrator, but is still awaiting government approval to resume work on site.
Once the authorisation is granted, Iamgold expects it will need 12 to 15 months to complete a feasibility study, as well as conclude an investment agreement for the project with the government of Ecuador.