Yamana Gold and Agnico Eagle have approved the C$1.7 billion ($1.3bn) construction of the Odyssey gold project at the Canadian Malartic mine in Quebec.
Canadian Malartic, located in the Abitibi region, is a 50/50 joint venture between Yamana and Agnico. The mine churned out more than 660,000 ounces of gold in 2019.
The underground project will extend the life of Canada’s largest operating open pit gold mine – to 2039, yielding an average of 545 000 oz/y from 2029 to 2039, at a total cash cost of $630/oz.
“One of Canada’s largest underground gold mining projects will come to fruition right here in Malartic. The future mine’s life is expected to extend until 2039 and operations could continue well beyond that, given the deposit’s significant potential,” said mine operator GM Serge Blais in a media statement.
An NI 43-101 technical report for the Canadian Malartic operation is expected to be filed in March, and will include a summary of the Odyssey underground project.
From 2029 to 2039, the underground operation will be in full production, producing an expected 500,000 to 600,000 gold ounces per year, according to Yamana.
“This represents an increase over the company’s initial estimate for an annual production platform of approximately 450,000 ounces,” the miner said.
Yamana reported full-year gold equivalent ounce production of 901,155 oz in 2020, including 779,810 ounces of gold and 10.37 million ounces of silver, exceeding its 890,000 oz guidance for the year.
The company expects gold output of 862,000 oz in 2021, 870,000 oz in 2022 and 889,000 oz in 2023. Silver production is forecast to decrease over the next three years, with 10 million ounces expected in 2021.
Yamana’s net earnings surged to $103 million, or $0.11 a share, from $14.6 million, or $0.02 a share, a year earlier.
Agnico on Thursday also reported a record net income of $511.6 million, or $2.12 a share, for 2020, compared with income of $473.2 million, or $2 a share, in 2019.
Payable gold production in 2020 was 1.7 million ounces at an AISC of $1 051/oz, topping the group’s guidance of 1.68 million to 1.73 million ounces at an AISC of between $1 025/oz and $1 075/oz.