* Cote Gold Project expected to start output in 2021
* Sumitomo Metal looking to boost output through
* Says deal will boost company's annual gold output to 18 T
(Adds comment, detail)
By Yuka Obayashi
TOKYO, June 6 Japan's Sumitomo Metal Mining Co
on Tuesday 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.
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.
"Since this project is located in the Abitibi gold belt in
eastern Canada, which is one of the world's largest
gold-producing areas, there may be additional reserves,
depending on future exploration," Tsuchida said.
Yoshiaki Nakazato, president of Sumitomo Metal, which is
also miner and smelter of copper and nickel, said last month
that the firm was still willing to invest in gold mines despite
the record loss it booked in the fiscal year to March 2017.
(Reporting by Yuka Obayashi and Chang-Ran Kim; Editing by
Michael Perry and Joseph Radford)