Renard Project mention
Agnico-Eagle expands, but Quebec is still home
'Right up there' with big players: Of $480 million in capital spending, half is in gold miner's home province
By ROBERT GIBBENS, FreelanceMay 19, 2010
Agnico-Eagle Mines Ltd. has spread its wings to Nunavut, Finland andMexico as it targets output of 1.5 million to 2 million ounces of goldby 2015, but its base remains firmly in Quebec, chief financial officerDavid Garofalo said.
Quebec will get half of Agnico-Eagle's $480million capital spending this year, he said, partly for deepening theLaRonde mine in northwestern Quebec and extending its life to 2023,expanding capacity at the nearby Lapa and Goldex mines and maintaininga heavy exploration budget.
The company doubled its first-quartergold output to 188,000 ounces and is shooting for a total of 1 millionto 1.1 million ounces for 2010.
"It's been a massive five-yeartask launching six new mining projects, including two outside Canada,to become an intermediate producer, but with rising cash flow and amarket capitalization of $10 billion or more, we're right up there withthe seniors now," Garofalo said from Toronto.
Agnico got itsstart with the low-cost LaRonde mine in the Abitibi region and Lapa andGoldex followed much later. Reserves are being added at all three andmill capacity boosted. It believes the prolific Cadillac Fault regionhosts a lot more gold yet.
It has an extensive land position inthe Abitibi and investments in a dozen junior explorers working there.It recently invested almost $2 million in Alexandria Minerals Corp., anexploration company with several active properties near Val d'Or.
Agnico-Eaglealso has a 15.7 per cent stake in Stornoway Diamond Corp., resultingfrom the spinoff of its diamond assets. Stornoway is developing theRenard diamond property in northern Quebec; a mine could eat up $500million or more and take another five years to build.
"Renard isthe best undeveloped diamond deposit anywhere and rough diamonds are inshort supply," Garofalo said. "A mine coming into production, say, in2015 would be rightly timed for the global market and it won't havetrouble getting financed."
Agnico-Eagle brought its Meadowbankmine in Nunavut into commercial production in March and the mill isoperating at 8,500 tonnes daily. About 200 Quebecers make up almosthalf the workforce. Meadowbank is a fly-in-fly-out operation, andaircraft ferry the Quebecers from Val d'Or and Montreal.
Thecompany last month invested $739 million for full ownership of ComaplexMinerals Corp., owner of the advanced-stage Meliadine project 300kilometres from Meadowbank.
It plans to expand capacity at theKittila mine in Finland and Pinos Altos in Mexico, but "our real baseremains in Quebec," Garofalo said.