Iamgold Reports First Quarter 2018 Results: Net Earnings up 335%; Operating Cash Flow up 58%; Growth Projects Firmly ON Track
TSX: IMG NYSE: IAG
NEWS RELEASE
IAMGOLD REPORTS FIRST QUARTER 2018 RESULTS:
NET EARNINGS UP 335%; OPERATING CASH FLOW UP 58%;
GROWTH PROJECTS FIRMLY ON TRACK
All monetary amounts are expressed in U.S. dollars, unless otherwise indicated.
For more information, refer to the Management Discussion and Analysis (MD&A) and Unaudited Consolidated
Interim Financial Statements for the three months ended March 31, 2018.
Toronto, Ontario, May 7, 2018 - IAMGOLD Corporation (“IAMGOLD” or the “Company”) reported its
consolidated financial and operating results for the quarter ended March 31, 2018.
“We had an outstanding quarter," said Steve Letwin, President and CEO of IAMGOLD. "Earlier in the year
we said our priorities were to meet expectations and to execute a robust set of growth projects. Gold
production in the quarter was up year-over-year, with Essakane and Westwood setting record highs. All-in
sustaining costs of $953 an ounce were down $118 an ounce from the fourth quarter of last year. A
significant improvement in our bottom line drove operating cash flow up 58%. Annual production and cost
guidance remains unchanged and our growth projects are firmly on track. At Essakane, the world’s largest
hybrid solar/thermal power plant was completed, and the pre-feasibility study for a heap leaching project,
as part of our expansion of the mine, is nearing completion. In the second half of this year, we expect to
have a mineral reserve estimate for Saramacca and a completed feasibility study for our Boto Gold
Project. With recent resource estimates for our Monster Lake and Eastern Borosi projects, nearly all of our
advanced greenfield projects have confirmed a resource."
First Quarter 2018 Highlights
Operating Performance
• Attributable gold production of 229,000 oz, up 7% from Q1/17.
• Attributable gold sales of 235,000 oz, up 11% from Q1/17.
• Cost of sales1 of $741/oz sold, down $28/oz from Q1/17.
• All-in sustaining costs2 of $953/oz sold, down $39/oz from Q1/17.
• Total cash costs2 of $737/oz produced, down $29/oz from Q1/17.
• Gold margin2 of $594/oz, up $130/oz from Q1/17.
• Production and cost guidance for 2018 maintained.
Financial Results
• Revenues of $314.5 million, up 21% from Q1/17.
• Gross profit of $75.8 million, up 117% from Q1/17.
• Net earnings attributable to equity holders of $42.3 million, or $0.09 per share; up from Q1/17 by
$60.3 million, or $0.13 per share, representing a 335% increase.
• Adjusted net earnings attributable to equity holders2 of $40.4 million, or $0.09 per share2; up from
Q1/17 by $35.3 million, or $0.08 per share2, representing a 692% increase.
• Net cash from operating activities of $106.0 million, up $39.1 million or 58% from Q1/17.
• Net cash from operating activities before changes in working capital2 of $119.6 million, up $35.2
million from Q1/17.
• Cash, cash equivalents, short-term investments in money market instruments, and restricted cash
of $856.3 million at March 31, 2018.
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Strategic Developments
• On April 3, 2018, we reported a new resource estimate for the Eastern Borosi Project, comprising,
on a 100% basis, 4.4 million tonnes of inferred resources grading 4.93 g/t Au and 80 g/t Ag for
700,500 ounces of contained gold and 11,359,500 ounces of contained silver, respectively.
• On March 28, 2018, we reported the first mineral resource estimate for the Monster Lake Project,
comprising, on a 100% basis, 1.1 million tonnes of inferred resources grading 12.14 g/t Au for
433,300 ounces of contained gold.
• On March 19, 2018, we announced the completion of the 15 megawatt-peak solar power plant at
our Essakane mine in Burkina Faso, which will save approximately 6 million litres of fuel per year
and reduce carbon dioxide emissions by 18,500 tonnes annually.
• On March 6, 2018, IAMGOLD and its joint venture partner, Sumitomo Metal Mining Co., Ltd.
("SMM" or "Sumitomo"), were awarded the Prospectors and Developers Association of Canada’s
2018 Viola R. MacMillan Award in recognition of their leadership in the financing and management
of the Côté Gold Project as it advances towards development.
• On February 28, 2018, we announced further high-grade intersections from infill and expansion
drilling at the Saramacca Project. Highlights included 11.73 g/t Au over 46.0 metres, 22.90 g/t Au
over 15.0 metres, and 3.70 g/t Au over 31.5 metres.
Upcoming Growth Catalysts
• Mineral reserve estimate expected for Saramacca H2/18; production start expected H2/19.
• Completion of pre-feasibility study for Essakane's Heap Leach Project, as part of our expansion of
the mine, expected Q2/18.
• Commissioning of oxygen plant to improve recoveries at Essakane expected Q4/18.
• Completion of Boto Gold feasibility study expected H2/18.
• Westwood ramp-up to full production expected by 2020.
• Completion of feasibility study at Côté Gold expected H1/19; potential production start 2021.
• Expect to receive remaining $95 million cash payment from Sumitomo by end of 2018 in
conjunction with the sale of a 30% interest in the Côté Gold Project in June 2017.
• Targeting initial resource estimate for Nelligan Project in Quebec in Q4/18.
• Targeting initial resource estimate for Gossey satellite prospect at Essakane in Q4/18.
• Advance exploration at Brokolonko to confirm the presence of mineralization and evaluate the
resource potential.
SUMMARY OF FINANCIAL AND OPERATING RESULTS
Three months ended March 31,
Financial Results ($ millions, except where noted) 2018 2017
Revenues $ 314.5 $ 260.5
Cost of sales $ 238.7 $ 225.5
Gross profit $ 75.8 $ 35.0
Net earnings (loss) attributable to equity holders of IAMGOLD $ 42.3 $ (18.0 )
Net earnings (loss) attributable to equity holders ($/share) $ 0.09 $ (0.04 )
Adjusted net earnings attributable to equity holders of IAMGOLD1 $ 40.4 $ 5.1
Adjusted net earnings attributable to equity holders ($/share)1 $ 0.09 $ 0.01
Net cash from operating activities $ 106.0 $ 66.9
Net cash from operating activities before changes in working capital1 $ 119.6 $ 84.4
Key Operating Statistics
Gold sales – attributable (000s oz) 235 212
Gold production – attributable (000s oz) 229 214
Average realized gold price1 ($/oz) $ 1,331 $ 1,230
Cost of sales2 ($/oz) $ 741 $ 769
Total cash costs1 ($/oz) $ 737 $ 766
All-in sustaining costs1 ($/oz) $ 953 $ 992
Gold margin1 ($/oz) $ 594 $ 464
1 This is a non-GAAP measure. Refer to the non-GAAP performance measures section of the MD&A.
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2 Cost of sales, excluding depreciation, as disclosed in note 30 of the Company's consolidated interim financial statements is on an attributable ounce
sold basis (excluding the non-controlling interests of 10% at Essakane and 5% at Rosebel) and does not include Joint Ventures which are accounted
for on an equity basis.
FIRST QUARTER 2018 HIGHLIGHTS
Financial Performance
• Revenues for the first quarter 2018 were $314.5 million, up $54.0 million or 21% from the same prior
year period. The increase was primarily due to higher sales volume at Essakane ($25.4 million) and
Westwood ($12.9 million), and a higher realized gold price ($23.9 million), partially offset by lower
sales volume at Rosebel ($7.7 million).
• Cost of sales for the first quarter 2018 was $238.7 million, up $13.2 million or 6% from the same prior
year period. The increase was primarily due to higher operating costs ($9.5 million), higher royalties
expense ($2.8 million), and higher depreciation ($0.9 million). Operating costs were higher primarily
due to higher energy costs at Essakane and Rosebel, a weaker U.S. dollar relative to the euro and the
Canadian dollar, and higher operating costs at Westwood resulting from the continued ramp-up,
partially offset by higher capitalized stripping due to mine sequencing at Essakane.
• Depreciation expense for the first quarter 2018 was $64.3 million, up $0.9 mill ion from the same prior
year period. The increase was primarily due to higher amortization of capitalized stripping, and higher
production at Essakane, partially offset by an increase in reserves at Rosebel.
• Income tax expense for the first quarter 2018 was $11.8 million, up $3.1 million from the same prior
year period. Income tax expense for the first quarter 2018 comprised current income tax expense of
$22.5 million (Q1/17 - $11.4 million) and deferred tax recovery of $10.7 million (Q1/17 - $2.7 million).
The increase in income tax expense was primarily due to changes in deferred income tax assets and
liabilities, fluctuations in foreign exchange, and differences in the level of taxable income in
IAMGOLD's operating jurisdictions from one period to the next.
• Net earnings attributable to equity holders for the first quarter 2018 were $42.3 million, or $0.09 per
share, up $60.3 million, or $0.13 per share, from the same prior year period. The increase was mainly
due to higher gross profit ($40.8 million), higher interest income, derivatives and other investment
gains ($18.2 million), and lower finance costs ($3.5 million), partially offset by higher income tax ($3.1
million).
• Adjusted net earnings attributable to equity holders 2 for the first quarter 2018 were $40.4 million, or
$0.09 per share2, up $35.3 million, or $0.08 per share2, from the same prior year period.
• Net cash from operating activities for the first quarter 2018 was $106.0 million, up $39.1 million from
the same prior year period. The increase was mainly due to higher earnings after non-cash
adjustments ($32.2 million) and higher net settlement of derivatives ($3.1 million).
• Net cash from operating activities before changes in working capital 2 for the first quarter 2018 was
$119.6 million, up $35.2 million from the same prior year period.
Financial Position
• We ended the first quarter in a strong financial position, with Cash, cash equivalents, short -term
investments in money market instruments and restricted cash of $856.3 million at March 31, 2018, up
$40.5 million from December 31, 2017. The increase was primarily due to cash generated from
operating activities ($106.0 million), partially offset by spending on Property, plant and equipment
($57.1 million) and Exploration and evaluation assets ($11.3 million).
Production and Costs
• Attributable gold production, inclusive of joint venture operations, was 229,000 ounces for the first
quarter 2018, up 15,000 ounces from the same prior year period. The increase was due to higher
grades at Essakane (16,000 ounces) and higher grades and continued ramp-up at Westwood (10,000
ounces), partially offset by lower grades at Rosebel (9,000 ounces) and lower throughput at the Joint
Ventures (2,000 ounces).
• Attributable gold sales, inclusive of joint venture operations, were 235,000 ounces for the first quarter
2018, up 23,000 ounces from the same prior year period. The increase was primarily due to higher
sales at Essakane (19,000 ounces) and Westwood (10,000 ounces), partially offset by lower sales at
Rosebel (5,000 ounces) and the Joint Ventures (1,000 ounces).
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• Cost of sales1 per ounce for the first quarter 2018 was $741, down 4% from the same prior year
period. The decrease was primarily due to higher sales volume and capitalized stripping, partially
offset by higher energy costs at Essakane and Rosebel, and a weaker U.S. dollar relative to the euro
and the Canadian dollar.
• Total cash costs2 for the first quarter 2018 were $737 per ounce produced, down 4% from the same
prior year period. The decrease was primarily due to higher production volume and capitalized
stripping, partially offset by higher energy costs at Essakane and Rosebel, higher royalties driven by a
higher gold price and a weaker U.S. dollar relative to the euro and the Canadian dollar.
• All-in sustaining costs2 per ounce sold for the first quarter 2018 were $953, down 4% from the same
prior year period. The decrease was primarily due to higher sales volume and capitalized stripping,
partially offset by higher energy costs at Essakane and Rosebel, higher sustaining capital, and a
weaker U.S. dollar relative to the euro and the Canadian dollar.
• While there was no impact on total cash costs2 and all-in sustaining costs2 for the first quarter 2018,
the first quarter 2017 included a reduction of $3 per ounce produced and sold, respectively, for the
normalization of costs and the revised ramp-up at Westwood. Total cash costs2 and all-in sustaining
costs2 for the first quarter 2018 included realized derivative gains from fuel and currency hedging
programs of $11 per ounce produced and $13 per ounce sold, respectively (Q1/17 - $nil and $nil).
• We maintain our full-year attributable production and cost guidance for 2018. Production in the second
quarter is expected to be at a lower level than the first quarter and to trend upwards from there in the
second half of the year. While first quarter production benefited from planned mining in higher grade
areas augmented by significant positive grade reconciliation at Essakane and Westwood, the second
quarter is expected to reflect the impact of scheduled mill maintenance activities at Rosebel and
Essakane and the seasonal rains at Rosebel. All-in sustaining costs2 are expected to move higher in
the second quarter before trending downwards in the second half of the year.
Commitment to Zero Harm Continues
• The DART rate3, representing the frequency of all types of serious injuries across all sites and
functional areas for the first quarter 2018 was 0.78, above the Company's target of 0.50. Zero Harm
remains our number one priority, and this year we are accelerating the deployment of a new Health
and Safety Management System and new prevention initiatives across all sites.
ATTRIBUTABLE GOLD PRODUCTION AND COSTS
Gold Production
(000s oz)
Cost of Sales1
($ per ounce)
Total Cash
Costs2
($ per ounce
produced)
All-in Sustaining
Costs2
($ per ounce
sold)
Three months ended March 31, 2018 2017 2018 2017 2018 2017 2018 2017
Owner-operator
Essakane (90%) 109 93 $ 712 $ 793 $ 665 $ 766 $ 914 $ 973
Rosebel (95%) 65 74 798 737 829 727 914 886
Westwood (100%)3 40 30 719 792 716 759 873 965
Owner-operator4 214 197 $ 741 $ 769 725 750 955 990
Joint Ventures 15 17 904 962 924 1,011
Total operations 229 214 $ 737 $ 766 $ 953 $ 992
Cost of sales1 ($/oz) $ 741 $ 769
Cash costs, excluding royalties $ 678 $ 715
Royalties 59 51
Total cash costs2 $ 737 $ 766
All-in sustaining costs2 $ 953 $ 992
1 Cost of sales, excluding depreciation, as disclosed in note 30 of the Company's consolidated interim financial statements is on an attributable ounce sold basis (excluding the
non-controlling interests of 10% at Essakane and 5% at Rosebel) and does not include Joint Ventures which are accounted for on an equity basis.
2 This is a non-GAAP measure. Refer to the non-GAAP performance measures section of the MD&A. Consists of Essakane, Rosebel, Westwood and the Joint Ventures on an
attributable basis.
3 There was no normalization of cost of sales per ounce for Westwood for the first quarter 2018 (Q1/17 - $25). Normalization of costs ended at the onset of the second quarter
2017.
4 Owner-operator cost of sales and all-in sustaining costs include corporate general and administrative costs. Refer to all-in sustaining costs reconciliation on page 27 of the
MD&A.
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OPERATIONS ANALYSIS BY MINE SITE
Essakane Mine - Burkina Faso (IAMGOLD interest - 90%)
Essakane had another record quarter, with attributable gold production of 109,000 ounces up 17% from
the same prior year period. The increase was mainly due to higher grades as a result of mine sequencing,
and higher mill recoveries as mining continues in non-graphitic zones. Total material mined was 13%
higher than the first quarter 2017, reflecting the commencement of mining at the Falagountou East pit.
Cost of sales of $712 per ounce sold and total cash costs of $665 per ounce produced for the first quarter
2018 were lower than the same prior year period by 10% and 13%, respectively. The decreases were
primarily the result of higher sales and production volumes, and higher capitalized stripping due to mine
sequencing, partially offset by higher energy costs, and a weaker U.S. dollar relative to the euro.
All-in sustaining costs of $914 per ounce sold for the first quarter 2018 were 6% lower than the same prior
year period. The decrease was primarily due to lower cost of sales per ounce, including the positive
impact of higher sales volume, partially offset by higher sustaining capital expenditures. Included in total
cash costs and all-in sustaining costs for the first quarter 2018 was the positive impact of realized
derivative gains from fuel and currency hedging programs of $18 per ounce produced and $21 per ounce
sold, respectively (Q1/17 - losses of $1 and $1).
Essakane continues to benefit from mill improvements in 2017, as throughput exceeded annualized
nameplate capacity of 10.8 million tonnes despite 85% hard rock content (Q1/17 - 90%). The pre-feasibility
study for the Heap Leach Project is on track for completion by the second quarter 2018 with a construction
decision expected in the second half of this year. The geometallurgical study to help better identify pockets
of graphitic material in the ore zones was completed during the first quarter 2018, with validation of results
on-going. In addition, construction of the oxygen plant which began in the fourth quarter 2017 is expected
to be commissioned in the fourth quarter 2018. The oxygen plant is expected to increase recoveries
through improved leach kinetics and to improve the efficiency of the circuit by reducing reagent
consumption.
The construction of the solar power plant was completed during the first quarter 2018. The 15 megawatt -
peak solar power plant is expected to decrease Essakane's fuel consumption by approximately 6 million
litres per year and CO2 emissions by 18,500 tonnes annually. The solar power plant will complement the
existing 57 megawatt thermal power plant, making it the largest solar/thermal hybrid power plant in the
world.
On the concessions surrounding Essakane, a second phase of delineation drilling commenced at the
Gossey satellite prospect, located approximately 15 kilometres northwest of the Essakane operation. We
expect to declare an initial resource estimate for Gossey by the end of this year.
Sustaining capital expenditures for the first quarter 2018 of $24.3 million included capitalized stripping of
$19.1 million, capital spares of $2.5 million, and various other sustaining capital expenditures of $2.7
million. Non-sustaining capital expenditures for the first quarter 2018 of $11.1 million included tailings liners
of $7.4 million, heap leach pre-feasibility study of $2.0 million, and various other non-sustaining capital
expenditures of $1.7 million.
Outlook
While first quarter 2018 production benefited from expected higher grades and significant positive grade
reconciliation, mill maintenance is scheduled during the second quarter. As a result, production is expected
to be lowest in the second quarter. We maintain full-year production guidance of 380,000 to 395,000
attributable ounces. Capital expenditures are expected to be approximately $150 million, comprising $75
million for sustaining capital and $75 million for non-sustaining capital.
Rosebel Mine - Suriname (IAMGOLD interest - 95%)
Attributable gold production of 65,000 ounces for the first quarter 2018 was 12% lower than the same prior
year period, primarily due to lower grades and throughput. Grades were lower due to mine sequencing and
the draw down of lower grade stockpiles. Mill throughput was lower mainly due to an increase in the hard
rock blend.
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Cost of sales of $798 per ounce sold and total cash costs of $829 per ounce produced for the first quarter
2018 were higher than the same prior year period by 8% and 14%, respectivel y. The increases were
primarily the result of lower capitalized stripping due to mine sequencing, higher energy costs, and lower
sales and production volumes.
All-in sustaining costs per ounce sold of $914 for the first quarter 2018 were 3% higher than the same prior
year period. The increase was primarily due to higher cost of sales per ounce, including the impact of
lower sales volume, partially offset by lower sustaining capital.
Following the announcement of the maiden resource estimate for the Saramac ca deposit in September
2017, drilling continued to further refine the resource model and target resource expansions immediately
adjacent to the initial resource pit shell. During the first quarter, we announced assay results from the
remaining 60 diamond drill holes completed as part of its delineation drilling program in the fourth quarter
of 2017. Highlights included: 11.73 g/t Au over 46.0 metres, 3.70 g/t Au over 31.5 metres, and 22.90 g/t Au
over 15.0 metres (see news release dated February 28, 2018). The results will be incorporated into an
updated resource model for use with the ongoing engineering studies. The program has continued to
deliver strong results, which, when combined with the ongoing engineering studies, is expected to result in
the declaration of a mineral reserve estimate in the second half of 2018. We intend to advance Saramacca
towards production in the second half of 2019.
During the quarter, we were awarded the exploration rights to the Brokolonko property. Located 30
kilometres southwest of the Rosebel mill, Brokolonko is believed to be on the same mineralization trend as
Saramacca, with high potential for yielding another source of higher grade softer rock.
The opportunities presented by Saramacca and Brokolonko, together with the significant increase in
reserves at Rosebel and the continued focus on cost containment, are expected to extend the life of the
mine and improve its profitability.
Sustaining capital expenditures for the first quarter 2018 of $8.1 million included capital spares of $3.1
million, capitalized stripping of $1.1 million, mobile equipment of $1.1 million, and various other sustaining
capital expenditures of $2.8 million. Non-sustaining capital expenditures for the first quarter 2018 of $5.0
million related to the Saramacca deposit.
Outlook
Production at Rosebel is expected to be highest in the second half of 2018 as seasonal rains in the second
quarter typically restrict access to higher grade zones at the bottom of the pits. Mill maintenance has also
been scheduled for the second quarter. Grade improvement is expected in the second half of the year
which will help mitigate the progressive increase in the proportion of hard rock. We maintain full -year
production guidance of 295,000 to 310,000 attributable ounces. Capital expenditures are expected to be
approximately $130 million, comprising $45 million of sustaining capital and $85 million of non -sustaining
capital.
Westwood Mine - Canada (IAMGOLD interest - 100%)
Westwood achieved record quarterly production of 40,000 ounces in the first quarter 2018, up 33% from
the same prior year period. The increase was primarily due to higher grades, and the continued successful
ramp-up resulting in higher throughput. While head grades to the mill for the quarter were higher than the
same prior year period, they were lower than the grades mined due to the processing of marginal ore
stockpiles to use available mill capacity as the mine continued to ramp-up. Head grade, excluding marginal
ore for the first quarter 2018, was 8.56 g/t Au (Q1/17 - 6.95 g/t Au).
Underground development continued in the first quarter 2018 to open up access to new mining areas with
lateral and vertical development of approximately 2,800 and 300 metres, respectively, averaging 35 metres
per day. Westwood plans to complete 12.2 kilometres of underground development in 2018 (10.8
kilometres lateral and 1.4 kilometres vertical), with a focus on ramp breakthroughs and infrastructure
development in future development blocks at lower levels.
Cost of sales of $719 per ounce sold and total cash costs of $716 per ounce produced for the first quarter
2018 were lower than the same prior year period by 9% and 6%, respectively. The decreases were
primarily due to cost efficiencies from higher sales and production volumes with the continued ramp -up,
partially offset by a weaker U.S. dollar relative to the Canadian dollar.
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All-in sustaining costs of $873 per ounce sold for the first quarter 2018 were 10% lower than the s ame
prior year period. The improvement was primarily due to lower cost of sales per ounce, including the
impact of higher sales volume resulting from the continued ramp-up, partially offset by a weaker U.S. dollar
relative to the Canadian dollar, and higher sustaining capital expenditures.
Westwood had been normalizing costs attributed to inventory in accordance with International Financial
Reporting Standards since the seismic event in May 2015. Normalization of these costs ended at the onset
of the second quarter 2017 when Westwood reached normal production levels. Costs for the first quarter
2017 were normalized by $0.7 million, which impacted total cash costs and all -in sustaining costs for the
first quarter 2017 by $23 per ounce produced and $25 per ounce sold, respectively. Total cash costs and
all-in sustaining costs for the first quarter 2018, included the positive impact of realized derivative gains
from currency hedging programs of $8 per ounce produced and $11 per ounce sold, respectively (Q1/17 -
gains of $1 and $1).
Sustaining capital expenditures for the first quarter 2018 of $6.0 million included deferred development of
$4.7 million and various other sustaining capital expenditures of $1.3 million. Non -sustaining capital
expenditures for the first quarter 2018 of $7.7 million included deferred development of $4.9 million,
development drilling of $1.4 million, underground construction of $1.1 million, and various other non -
sustaining capital expenditures of $0.3 million.
Outlook
Production at Westwood is expected to be more heavily weighted in the first half of 2018 with the mining of
high grade stopes. The first quarter benefited from significant positive grade reconciliation. We maintain
full-year 2018 production guidance of 125,000 to 135,000 ounces. Capital expenditures are expected to be
approximately $65 million, comprising $20 million in sustaining capital and $45 million in non -sustaining
capital.
Sadiola Mine - Mali (IAMGOLD interest - 41%)
Attributable gold production of 15,000 ounces for the first quarter 2018 was 6% lower than the same prior
year period mainly due to lower throughput and recoveries. Total cash costs of $926 per ounce produced
and all-in sustaining costs of $939 per ounce sold for the first quarter 2018 were 3% and 8% lower than
the same prior year period, respectively, as a result of greater drawdowns of marginal ore stockpiles.
Sadiola is expected to produce between 50,000 and 60,000 ounces in 2018.
Discussions with the Government of Mali continue regarding the Sadiola Sulphide Project. Despite the
Company's efforts and the benefits the Project would generate locally and to the Government of Mali, there
has been no resolution around the terms critical to moving the Project forward. Subsequent to the end of
the first quarter 2018 with the depletion of oxide ore, mining activities ceased and the mill is now
processing stockpiles.
Although the Company remains committed to the Project, upon failing to reach an agreement the operation
will enter a phase of suspended exploitation (care and maintenance) when stockpiles are exhausted which
is expected by the second half of 2019.
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DEVELOPMENT PROJECTS
Côté Gold Joint Venture Project, Canada
The Côté Gold Project is a 70:30 joint venture between the operator IAMGOLD and Sumitomo Metal
Mining Co., Ltd. ("SMM"). The Project hosts estimated mineral reserves as at December 31, 2017 on a
100% project basis comprising probable reserves of 196.1 million tonnes grading 0.94 g/t Au for 5.9 million
ounces. Also on a 100% project basis, indicated resources (inclusive of reserves) are estimated at 281.2
million tonnes grading 0.89 g/t Au for 8.0 million ounces of gold and inferred resources of 76.5 million
tonnes grading 0.50 g/t Au for 1.2 million ounces (see news release dated February 12, 2018).
During the first quarter, the joint venture partners working with Wood Group (formerly Amec Foster
Wheeler) continued to work on the feasibility study which is expected to be completed in the first half of
2019. As part of the study, a delineation drilling program initiated in 2017 to further refine the resource
model continued during the quarter with approximately 21,700 metres of diamond drilling completed.
Geotechnical investigations to evaluate pit slope stability and to investigate proposed locations of key
project infrastructure were also initiated.
Subject to an acceptable feasibility study, a favourable development environment and a positive
construction decision by the Côté Gold Joint Venture, commercial production is expected to begin in 2021.
Regional exploration activities also continue within the 516-square-kilometre property surrounding the
Côté Gold deposit to develop and assess exploration targets that could further maximize the Company ’s
flexibility with respect to any future development decisions.
EXPLORATION
In the first quarter 2018, we spent $20.5 million on exploration and project studies compared to $14.2
million in the same prior year period. The increase is primarily due to increased spending on feasibility and
other studies. Of the $20.5 million spent in the first quarter 2018, $8.3 million was expensed and $12.2
million was capitalized. The following summarizes the status of our most advanced greenfield projects:
Wholly-Owned Projects
Boto - Senegal
As reported previously, we announced the results of a pre-feasibility study (“PFS”) for the Boto Gold
project in the first quarter 2018 (see news release dated February 12, 2018). A technical report
summarizing the PFS was subsequently filed on SEDAR.
Based on the results of the PFS, the Boto Gold Project hosts estimated mineral reserves as at December
31, 2017 comprising probable reserves of 26.8 million tonnes grading 1.64 g/t Au for 1.4 million ounces.
Indicated resources (inclusive of reserves) are estimated at 37.4 million tonnes grading 1.60 g/t Au for 1.9
million ounces of gold and inferred resources are estimated at 11.0 million tonnes grading 1.66 g/t Au for
594,000 ounces of gold.
The PFS recommended the completion of a feasibility study (“FS”) to validate and detail the elements of
the development concept set out in the PFS, and which would include additional drilling, metallurgical
testing, engineering and environmental studies, including hydrological, hydrogeological and geotechnical
analyses. The FS has been initiated and is expected to be completed in the second half of 2018.
Importantly, the FS contemplates using a mill throughput 25% higher than was used for the PFS.
Exploration activities supporting the FS and evaluating priority targets for additional mineral resources
continued during the quarter and involved the completion of approximately 11,900 metres of diamond and
reverse circulation drilling, including just under 1,800 metres for geotechnical investigations.
Siribaya - Mali
Effective December 31, 2017, total resources estimated for the Siribaya Project comprised indicated
resources of 2.1 million tonnes grading 1.9 g/t Au for 129,000 ounces of gold, and inferred resources of
19.8 million tonnes grading 1.7 g/t Au for 1.1 million ounces (see news release dated February 12, 2018).
During the first quarter 2018, we announced drilling results for the 2017 drilling program on the Diakha
deposit which successfully delineated high-grade structures within the known resources and confirmed