(Kitco News) - IAMGOLD (TSX: IMG) (NYSE: IAG) announced yesterday that it has reached an agreement to amend the Côté Gold Joint Venture Agreement with Sumitomo Metal Mining and SMM Gold Cote.
The company said that under the agreement, commencing in January 2023, Sumitomo will contribute certain of IAMGOLD's funding amounts to the Côté Gold Project that in aggregate are expected to total approximately $340 million over the course of 2023.
"As a result of Sumitomo funding such amounts, IAMGOLD will transfer, in aggregate, an approximate 10% interest in Côté to SMM as funding is made by SMM, subject to the right for IAMGOLD to repurchase the transferred interests pursuant to the terms of the agreement," the company added.
IAMGOLD noted it will pay a repurchase option fee to SMM on the terms set forth in the agreement, and IAMGOLD shall have the right to exercise the repurchase option on seven dates between November 30, 2023 and November 30, 2026, to return to its full 70% interest in the Côté Gold Project.
IAMGOLD may exercise its option through the payment of the aggregate amounts advanced by Sumitomo in respect of the transferred interests, subject to certain adjustments. IAMGOLD will remain the operator of the Côté Gold Project.
"The financial support of Sumitomo demonstrates to all of our stakeholders the strong validation of the Côté Gold Project from our partner and our alignment to complete construction and commence production," stated Maryse Bélanger, Chair and interim President and CEO of IAMGOLD. "On behalf of the Board and IAMGOLD, I want to thank Sumitomo for their continued support and dedication as together we continue to build what will be Canada's third largest gold mine by production. It is Sumitomo's and IAMGOLD's intent for IAMGOLD to return to a 70% interest in the project, and the flexibility of the terms of the agreement reflects that alignment."
IAMGOLD also said that the Côté Gold Project remains on track for gold production in early 2024, in line with the updated schedule and cost to complete as outlined on the company’s most recent project update at the end of last quarter.
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