Production at Canada-based gold miner Iamgold could fall below 700 000 oz this year, owing to the continuing global Covid-19 crisis.

The company, which owns assets in Canada, Burkina Faso, Mali and Suriname on Monday lowered its guidance for 2020 to between 685 000 oz and 740 000 oz, compared with its previous guidance of between 700 000 oz and 760 000 oz for the year.

Iamgold also lowered its capital expenditure (capex) guidance by $25-million to $345-million and revised upwards its cost guidance, with all-in sustaining costs to range between $1 195/oz and $1 245/oz.

The guidance for development or expansion capex has been reduced from $250-million to $220-million, while sustaining capex has been increased from $120-million to $125-million.

The $30-million decrease in non-sustaining capex was primarily owing to a reduction in capitalised stripping and timing of spend on other projects at Essakane, in Burkina Faso, timing of spend on the Saramacca project, in Suriname, and lower development at Westwood, Canada, partially offset by higher expected capex to continue progressing the Early Works programme at the Côté gold project, also in Canada.

Iamgold produced 170 000 oz in the first quarter, down 3 000 oz from the same prior-year period. The decrease was attributed to lower grades at Essakane as a result of mine sequencing, lower throughput at Rosebel as ore feed was supplemented from lower grade ore stockpile and higher grade pebbles as mining activity focused on achieving strategic pushbacks, partially offset by higher throughput at Westwood.

Attributable gold sales from continuing operations were 159 000 oz for the first quarter 2020, down 19 000 oz from the same prior year period.

The group reported all-in sustaining costs of $1 230/oz, up 12% from the same prior year period. The increase was primarily owing to higher cost of sales per ounce, partially offset by lower sustaining capex.

“Iamgold benefited from strong revenues on higher gold prices in the quarter, generating $44-million in operating cash flow, notwithstanding the rapid onset of the Covid-19 crisis toward the end of the quarter," commented newly appointed president and CEO Gordon Stothart.

"Our gold margins improved 45% from one year ago, with production on plan, but lower sales volumes. We made good progress on waste stripping at Essakane, and are on track to achieve our 2020 run rate at Saramacca in the second half of the year, while Westwood has been steadily achieving production and cost targets.”

Iamgold lowered its net loss from continuing operations to $34.4-million in the quarter, compared with a net loss of $40.7-million in the same period a year ago. The adjusted net loss came to $4.9-million, or $0.01 a share, from $6.9-million in the first quarter of 2019.