Dual-listed Alamos Gold has broken ground on the Phase 3 expansion of its Island Gold mine, in Ontario, more than doubling the mine life of the Algoma region’s “economic engine”, CEO John McCluskey said on Monday.

The Phase 3 expansion study, published in 2020, outlined a 16-year mine life during which Island Gold is expected to expand from 1 200 t/d to 2 000 t/d following the completion of the shaft in 2025. This will drive up production by 70% to an average of 236 000 oz/y at an all-in sustaining cost of $534/oz.

Since the release of the study, mineral reserves and resources have increased by 37% to 5.1-million ounces of gold. This growth will be included in an updated mine plan, which will be published by mid-year.

“When we first acquired the Island Gold mine we were aware of its potential. It had 1.8-million ounces of mineral reserves and resources, and through exploration investment we have increased this high-grade deposit to 5.1-million ounces of mineral reserves and resources.

“By further investing in the Phase 3 expansion, we will more than double the mine life. This mine will be an economic engine for this region for years to come, and positively impact the closest town of Dubreuilville and surrounding communities,” McCluskey said.

Commenting in a statement, Ontario Minister of Northern Development, Mines, Natural Resources and Forestry Greg Rickford stated that the expansion project was the latest in a series of recent success stories in Ontario’s mining sector.

“The project will bring good-paying jobs and prosperity throughout the region including northern and Indigenous communities."

The Island Gold mine is a significant employer in the region, sustaining more than 600 jobs a year, which will continue over the life-of-mine. During the construction phase of the expansion, employment is expected to double to 1 200 jobs.

Island Gold’s employees account for over 20% of total mining employment in the Algoma region. Among Island Gold employees, about 6% belong to Indigenous communities, which is more than twice the Ontario mining industry's average of 2.4%.