COAL, URANIUM & OIL SANDS — Iamgold bouyed by profits

Increased production and lower costs from the Sadiola Hill gold mine in Mali have enabled Iamgold (IMG-T) to post higher revenue, income and cash flow in 1998 over the previous year.

The company and partner Anglogold (AU-N) achieved commercial production at Sadiola Hill in March 1997. Last year, the US$303-million, open-pit operation churned out 506,113 oz. gold at an average cash cost of US$104 per oz. and a total cost of US$126 per oz. (T.N.M., Feb. 1/99).

Sadiola Hill is owned by SEMOS, a Malian company held 38% by each of Anglogold and Iamgold. The government has an 18% stake, while 6% is held by International Finance Corp.

For the year ended Dec. 31, Iamgold reported net income of US$8.7 million on sales of US$60.3 million. This compares with net income of US$2.5 million on sales of US$49.5 million in 1997.

Iamgold and Anglogold plan to advance a second mine, Yatela, situated nearby, which hosts 1.92 million oz. gold contained in 20.5 million tonnes of soft oxides grading 2.9 grams gold per tonne, at a cutoff grade of 1 gram. Of this total, 17.9 million tonnes grading 3.1 grams are classed as drill-indicated. The project is owned by SADEX, a 50-50 joint venture between the company and Anglogold. The partners purchased Yatela from an Australian contract miner for $7.5 million several years ago.

Feasibility work will be carried out in an attempt to upgrade the initial resource categories to proven and probable reserves and measured resources.

Iamgold and Anglogold are assessing four main options for production, the most obvious being a plan to transport Yatela ores by road to Sadiola Hill for treatment in the existing plant. Expanding the modular plant at Sadiola is another option, while a third is treatment on site in either a carbon-in-pulp or carbon-in-leach plant. The fourth option is heap leaching.

The partners expect to choose a processing option shortly and incorporate that choice into Anglogold’s feasibility study, which is due for completion this summer. If the study is positive, mine development would begin immediately, and take 18-24 months to complete.