Alamos Gold Declares $1.07 Billion Capital Project at Island Gold Mine

SEATTLE (Scrap Monster): Canadian miner Alamos Gold announced its decision to proceed with the expansion of Island Gold Mine in Ontario. The proposed shaft expansion at the mine is expected to provide major boost to output, at a reduced cost, thereby turning it more profitable. It must be noted that the mine is already one of the most profitable mines in the country.

John McCluskey, CEO, Alamos announced that further to the Phase 3 expansion study that highlighted the growing value of the mine, it has decided to go ahead with the $1.07 billion capital project for shaft expansion. The project, which is estimated to require $ 514 million in growth capital and $552 million in sustaining capital, will ultimately result in expansion to 2,000 tonnes per day. The expansion project includes installation of shaft and paste plant. In addition, it comprises of expansion of the mill and tailings facility.

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Further to completion of shaft in 2025, the average gold production is expected to increase by around 72% to 236,000 ounces per year. The total cash costs are expected to fall by 19% to $403 per ounce of gold. Also, the all-in sustaining costs will shrink by as much as 30% to $534 per ounce, from the midpoint of the previously announced guidance for the current year.

Alamos Gold had acquired Island Gold mine in 2017 at a cost of approximately $600 million.