IAMGOLD: Royalties at Rosebel added extra US$50/oz to costs

Bnamericas Published: Wednesday, February 25, 2009
Toronto-based IAMGOLD (TSX: IMG) has been negatively impacted by the purchase of royalties at its Rosebel yellow metal mine in Suriname, which increased costs by US$50/oz at the mine and added US$10-15/oz group-wide, company CEO Joe Conway said in a webcast speech at the BMO Capital Markets 2009 Global Metals and Mining Conference. "That's the reason we bought out Euro Resources," Conway said. On December 30 IAMGOLD paid an aggregate value of Cdn$19.6mn (US$16mn) for Euro's common shares, valued at 1.20 euros each. IAMGOLD has a 95% indirect interest in the Rosebel gold mine, including the ownership of its mining rights and assets, whereas Euro holds the Rosebel royalty. Rosebel averaged a cash cost of US$404/oz last year, versus US$403/oz the year before. Production attributable to IAMGOLD's 95% of Rosebel amounted to 315,000oz gold in 2008, a 20% increase over the prior year. Conway added IAMGOLD is interested in acquisitions but not in any operation or project that would produce less than 100,000oz/y. IAMGOLD also owns gold mining operations in West Africa and exploration properties in Brazil and Argentina.

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