In view of adding resources that extend the life of the existing infrastructure at Iamgold Corp’s (IAG, Financial) operations in South America, the Canadian miner reached an agreement with the Government of Suriname to acquire an interest in the Saramacca property, which is located approximately 30 kilometers southwest of the Rosebel mill and immediately southeast of the Sarafina property.
Source: from the CIA World Factbook - 24 July 2008 edition
In Suriname, Iamgold already operates through the Rosebel mine, which is located in the Brokopondo district in the northeastern part of the country.
The Saramacca property has been previously explored in a joint venture between Golden Star (GSS, Financial) and Newmont (NEM, Financial), suggesting a potential of between 8 and 40 million tons grading between 1.0 and 1.8 g/t Au for 0.5 to 1.4 million ounces of gold. But the drilling results of the previous exploration activities are insufficient to define a mineral resource, that is why Iamgold will send the Rosebel's exploration team to further explore the property and investigate it through a due diligence. Once the exploration team is satisfied with the results of the study, the miner will pay $10 million plus 3.125 million Iamgold common shares that will be released to the government of Suriname in three tranches following the ratification of the agreement by Rosebel.
There is no certainty that the exploration activities will advance the property to a resource stage, but if the study is successful, this project “should provide important support to the economy of the country,” said Steve Letwin, Iamgold President and CEO, considering that Rosebel has a mine life of 6.6 years according to a revised plan completed in December 2015.
Iamgold gained 160.56% YTD and it is down trending since the beginning of August.
The Price/Book (mrq) is 0.76 and the EV/EBITDA is 10.37.
Disclosure: I have no positions in Iamgold Corp.
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