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Japan's Sumitomo Metal to buy stake in Canada gold project for $195m

Staff Writer |
Japan's Sumitomo Metal Mining said it had agreed to take a 27.75-percent interest in a Canadian gold mining project from Toronto-based IAMGOLD Corp for $195 million.

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The purchase of the stake in the Cote Gold Project in Ontario comes as Japan's biggest gold miner looks to boost its output through acquisitions and exploration.

IAMGOLD owns 92.5 percent of the project, currently in its so-called pre-feasiblity study phase. Production is slated to begin in 2021, with the development expected to churn out 168 tonnes of gold over a 17-year life.

"With this deal, we will make progress towards our long-term goal of boosting gold output from our equity holdings to 30 tonnes a year," Naoyuki Tsuchida, Sumitomo Metals senior managing executive officer, told a news conference.

The deal is expected to complete by the end of September.

The company said the project would boost its annual gold output to nearly 18 tonnes from 15 tonnes now.

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