A strong performance by its 38%-owned Sadiola Hill gold mine in Mali, West Africa, propelled Iamgold (IMG-T) to profitable heights in 1997.
It was the first year of operation for Sadiola Hill, in which the government of Mali holds an 18% interest and International Finance Corp., 6%. The remaining 38% is held by South African-based Anglo American.
Commercial production commenced March 1. During the fourth quarter, 1.3 million tonnes were mined, yielding 137,424 oz. gold at a cost of US$179 per oz. A 3.1-gram-per-tonne head grade was reported, and gold recovery was 97%.
Reserves at Sadiola Hill are estimated at 7.1 million oz. gold. Iamgold earned US$2.5 million (or US4 per share) in 1997, despite a US$7.1-million writedown on certain exploration expenses. Earnings prior to the writedown were US$9.6 million (US15 per share).
Cash flow in the fourth quarter amounted to US$5.6 million, compared with US$6.9 million in the previous quarter.
“We are extremely pleased with Sadiola’s performance to date,” says Iamgold President Todd Bruce. “In our first year of production, we exceeded all significant operational targets, and, despite the environment of low gold prices, we still recorded a net profit and positive cash flow from operations.”
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