Canadian gold producer IAMGOLD said that it will not move ahead with the construction of the Cote Gold Project in Canada, owing to current market conditions.
Located in Gogama in northeastern Ontario, the Cote Gold Project was planned to be developed with an investment of around $1bn.
The Canadian gold producer will wait for market conditions to improve and become sustainable before taking up construction on the project. However, it will continue to advance engineering and permitting work at the gold project.
IAMGOLD president and CEO Steve Letwin said: “We are focused on creating superior shareholder value by allocating our capital to our best near- and long-term opportunities in a manner that is consistent with shareholder expectations, and with our goal of maintaining a strong balance sheet.
“We have substantially de-risked the Côté Gold Project, from both a technical and financial perspective, and believe in its potential to positively transform the Company.”
For the Cote Gold Project, IAMGOLD had completed a prefeasibility technical report. It had identified close to 10.0 million ounces in measured and indicated resources at the gold prospect.
The gold producer is currently engaged in developing a feasiblity study base mine plan and a feasibility study extended mine plan with enhanced net present values and internal rates of return compared to the prefeasiblity study.
IAMGOLD said that its focus will continue to be on its existing operations and on current initiatives and opportunities at Saramacca, Rosebel, Westwood and Essakane.
Discovered in 2010, the Cote Gold deposit had seen extensive diamond drilling works for its delineation. IAMGOLD owns a stake of 64.75% in the gold project while the remaining 27.75% stake is owned by Japan-based Sumitomo.
The Cote Gold Project, which was planned to begin construction this year, was targeted to achieve its first gold pour in 2021. The open pit mine is expected to be in production for nearly 17 years.
Construction on the project is expected to generate more than 1,000 jobs and after its completion, 300-400 jobs are estimated to be created for its operations.