Agnico-Eagle extends Canadian Malartic lifespan to 2042

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Agnico-Eagle Mines Ltd. [AEM-TSX, AEM-NYSE] on Tuesday released the results of a new internal study on its Odyssey mine, which forms part of the company’s 100%-owned Canadian Malartic complex, located 25 kilometres west of Val-d’Or in northwestern Quebec.

The company said the study reflects progress to date, including a significant conversion of mineral resources and a mine life extension to 2042.

Canadian Malartic ranks among the world’s largest gold mining operations, consisting of the Canadian Malartic open-pit mine and the underground Odyssey mine. The open pit mine and 60,000 tonne-per-day processing plant produced 658,792 ounces of gold in 2022 (100% basis).

“Since the initial discovery of the East Gouldie deposit in late 2018, the company has made tremendous progress bringing the Odyssey mine into production, initiating the transition from the largest open pit gold mine in Canada to the largest underground mine in Canada,’’ said Agnico President and CEO Ammar Al-Joundi in a press release.

“Over the last three years, we have significantly de-risked the project while improving the production profile and increasing its overall value,’’ he said. “We have added approximately 1.7 million ounces of gold to the mine plan and extended the mine life to 2042.’’

He went on to say that the company continues to aggressively explore the property and evaluate regional projects that could allow Agnico to utilize the anticipated future excess mill capacity which is expected to be approximately 40,000 tonnes per day starting in 2028.

This additional mill capacity provides significant optionality for organic growth at Odyssey, property-wide exploration upside, and from the development of other prospects in the company’s regional pipeline.

Meanwhile, highlights from the new internal study are as follows:

The Canadian Malartic complex is expected to generate positive free cash flow during the transition period from open pit to underground mining, even at US$1,650 per ounce.

The company said recent positive drill results in the Odyssey internal zones indicate the potential to further increase production during the 2023-2028 transition period. From 2029 onwards, gold production at the Canadian Malartic complex is forecast to average 558,000 ounces of gold annually over 13 years at a total cash cost of US$768 an ounce.

Production forecasts are supported by a larger mineral resource estimate at the end of 2022. The mine plan now includes approximately 0.2 million ounces of gold in mineral reserves and an indicated resource of 4.8 million ounces, plus a further 4.0 million ounces of inferred resources.

Agnico-Eagle acquired Yamana Gold’s 50% interest in Canadian Malartic back in March, 2023, leaving Agnico with a 100% interest in both the Canadian Malartic and Odyssey mines.

On Tuesday, Agnico shares eased 2.8% or $1.84 to $64.63. The shares are currently trading in a 52-week range of $82.90 and $48.87.

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