Estimated operating costs also went up to C$854 ($665) per oz. of gold sold, from C$802 ($624) per oz. in its 2021 technical report.
In 2020, before construction began, Iamgold pegged its 70% of costs at $875-$925 million (which would put total costs at around $1.3 billion).
Côté’s mine life is estimated to be 18 years, with initial production now pushed ahead to early 2024 from the previous schedule of late 2023. The project is located about 125 km southwest of Timmins.
Iamgold interim CEO Maryse Bélanger said the company is pursuing alternatives to increase liquidity to complete construction and start production in line with the updated schedule.
“We expect to address these near-term challenges to advance Côté and better position Iamgold as a more resilient, agile company for the current environment,” she said.
The expenditure increase comes after the company’s previous assessment in January put construction costs at $710 million to $760 million for its share of the JV.
In a note on Thursday, BMO analyst Jackie Przybylowski noted the miner will need additional funds for the project.
“We assume total spend (from Q3/20) of $2.8 billion (100% basis) versus our previous estimate $2.6 billion,” she said.
Przybylowski added that financing continues to be a “major overhang” for the project and BMO believes borrowing on a credit facility will fill the funding gap at an estimated $1.1 billion, plus extension of the 2022 prepay arrangement.
“We note that equity or other funding sources would be dilutive to shareholders,” she said.
The cost increases also come as the miner continues to search for a new chief executive, following the resignation of Gordon Stothart in January. Bélanger was in May appointed interim president and CEO, taking over from CFO and executive VP of strategy and corporate development Daniella Dimitrov, who filled Stothart’s role after his departure.
Côté is expected to produce 495,000 oz. per year in its first six years and 365,000 oz. over the life of the mine. It would be the company’s fourth mine.
The project is 92% owned and operated by the Iamgold-Sumitomo JV, with 7.5% held by a third party, Treelawn Investment Corp.
Iamgold shares started off the day in Toronto at C$2.02 and climbed to C$2.13 at mid-morning, before falling to C$1.98. Its shares are in a 52-week window of C$1.72 and C$4.74 and it has a market cap of C$972 million ($756.6m).