Agnico Eagle Mines Ltd. plans to invest more than $1.2 billion in Canada’s subarctic in the next three years as it builds one new mine and expands another.
North America’s fourth-largest gold miner by market value is moving ahead with plans to develop its Meliadine project and a deposit near its Meadowbank mine in Nunavut, the company said Wednesday in its fourth-quarter earnings statement. The decision will boost Agnico’s gold production to 2 million ounces a year by 2020, about 20 percent more than last year’s output of 1.66 million ounces.
“This is very much low-risk, high-quality growth because it’s an extension of what we’ve been doing for the last many, many years,” Chief Executive Officer Sean Boyd said in an interview at the company’s Toronto offices.
Agnico will spend $900 million through 2019 to build a new mine at its Meliadine deposit, located on the western shore of Hudson Bay, about 290 kilometers (180 miles) southeast of its Meadowbank mine, Boyd said. Over the same period it will spend another $330 million to develop Amaruq, a satellite deposit northwest of Meadowbank that will extend that mine’s life by at least six years.
The expenditures will be funded with existing cash, free cash flow and, if needed, funds drawn from an untapped $1.2 billion revolving credit facility, Boyd said.
Previously, the company had said that it had the potential to grow production to 2 million ounces a year by developing assets it already owns.
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