Mill Expansion Okayed for Iamgold's Rosebel Gold Mine

Engineering and Mining Journal, Mar 2008

Iamgold Corp. reported that its board of directors' has approved an $18.4-million budget for mill expansion at the Rosebel gold mine in Suriname. Iamgold acquired the Rosebel operation in 2006 through its merger with Cambior.

According to the company, the expansion allows for an increase in the annual life of mine production from approximately 275,000 oz/y to 300,000-305,000 oz/y of gold and a reduction in direct cash costs of approximately $35/oz. Mill throughput will increase from 8 million mt/y of ore to 8.9 million mt/y while adding operational flexibility to increase throughput by another 15%-25% if warranted. The mill expansion eliminates the need for stockpiles, and through the installation of extra leach tanks to increase residence time, will boost metallurgical recovery from 94% to 95%.

"This program will continue to improve production from Rosebel and bring down cash costs at the operation, resulting in a reduction of our overall cash costs," said Joseph Conway, president and CEO. "Rosebel is our largest and most significant operation and there is considerable value yet to be realized there."

A mill optimization program that began in 2007 will be completed in November 2008, according to the company, and will allow production rates to be maintained as more hard rock is fed into the mill. Approximately $15 million of the program's $26-million budget remains to be spent during 2008. The announced $18.4 million investmentinvolving improvements to the plant's leaching capacity, tailings pumping and piping, ore handling and conveying, gravity circuit and thickening-is also planned for 2008, with results having an impact on production and costs beginning in 2009.

Concurrent with mill expansion is the redesign of the existing mine plan to eliminate marginal ore and reduce the life of mine strip ratio from 4 to 3.5 while maintaining the mine reserve grade at 1.2 g/t. The company stated that the impact of the lower strip ratio and the reduction of marginal material in the mine plan will reduce the current mine life by one year through the loss of about 430,000 oz of gold reserves, but a significant increase in profitability will offset the potential loss of production.

Further mine engineering work is also ongoing for an expansion in mine production capacity through an increase in the size of the mining fleet. Iamgold plans to spend $12.8 million to replace old equipment including six haul trucks, four backhoes and two dozers; and another $3.9 million to acquire a new hydraulic excavator and other equipment. The current mining fleet comprises 36 trucks of 90-mt capacity, seven shovels, two loaders, 10 drills and 11 D9 dozers.

Iamgold is also spending $9.8 million on exploration and development which includes 26,000 m of infill drilling for reserves development and resource conversion and 35,000 m to delineate additional resources on known targets.

San Bartolomé Silver Mine Near Startup

Coeur d'Alene Mines Corp. announced in early February that it had begun precommissioning activities at its San Bartolomé mine in Bolivia, and expects to produce over 10 million oz of silver during its first 12 months of full-scale operations.

According to the company, all major plant equipment at San Bartolomé is now in place. Coeur expected the processing facilities to be connected to the national electrical grid during the second half of February, at which point full commissioning of the crushers and mills would commence. Processing of ore was anticipated to begin during the second half of March. Production and plant utilization will then steadily increase with full plant capacity targeted for August.

Dennis E. Wheeler, chairman, president and CEO of Coeur, said, "Over 1,600 workers, almost all of them Bolivians, have done an excellent job in constructing what will be the world's largest pure silver mine, surpassing over 3.7 million man hours without a lost time accident, a truly remarkable achievement given the size and scope of this state-of-the-art facility. Coeur is proud of the strong community, government and economic relationships we have developed with the people and organizations of Potosi and Bolivia, and the company is excited about placing the mine into production and generating value for all stakeholders."

Coeur expects San Bartolomé to produce more than 6 million oz of silver during the remainder of 2008, and figures operating cash costs once the plant reaches full-scale operations in August through the end of the year to be $4.10/oz (excluding royalties and production taxes of $2.03/oz). The property contains 153 million oz of silver reserves and 34.2 million oz of additional indicated mineral resources. Mine life will be approximately 14 years, according to the company.

Updated Reserve and Finance Numbers for Dolores Project

Minefinders Corp. recently released an updated economic forecast and reserve estimate for its Dolores gold and silver mine in Chihuahua, Mexico.

The report shows that proven and probable reserves at the mine increased 37% from a February 2006 feasibility study to 99.3 million mt containing 2.44 million oz of gold and 126.64 million oz of silver-increases of 24.8% and 22.1%, respectively. Life of mine production increased to 1.8 million oz of gold and 64.3 million oz of silver or 3 million oz of gold and gold-equivalent silver at base case prices. Life of mine average cash operating costs are now estimated at $297 per gold equivalent ounce and $32 per gold ounce, net of silver by-product credits. Initial capital costs are now pegged at $192 million including a $10-million contingency, of which $141 million had been spent by the end of 2007. Sustaining capital costs are estimated at $50 million with net cash flow from operations of $1.1 billion over the life of the mine. Base case metal price assumptions of $675/oz gold and $13/oz silver were used in the economic analysis, with $600 gold and $10 silver used to define the reserve.