Ontario Construction News staff writer
The cost to build Argonaut Gold’s Magino mine in northern Ontario has jumped by $290 million, to $800 million due to inflation and COVID-19.
According to a news release, capital construction for the open-pit mine jumped from $510 million and president-CEO Pete Dougherty resigned in December.
“Pete Dougherty has taken Argonaut from a small company to a diversified gold producer operating in three countries,” board chair James Kofman said in the release.
“The board of directors intends to work actively with and be available to the executive leadership team. We have full confidence in the existing executive team to step up during this interim period.”
Changes in scope account for about one quarter of the increase and $94 million are being blamed on cost overruns because of inflation and COVID.
Also, there were challenges with the civil works at the process facilities site in the early stages of construction because uneven surface bedrock required much more time and capital to create a suitable foundation area than originally estimated.
Highlights from the company’s December project newsletter include:
- Concrete work continues on the plant site
- Water Quality Control Pond (WQCP) stripping started with rockfill placed
- Additional lean concrete and structural concrete placed for the process plant foundations.
- Formwork for process plant foundations continue for the leach tanks, transformer and perimeter piers.
- Structural steel for process plant building arrived on site and being assembled for erection.
- Expanding the pit with a 50-metre layback for further overburden for the TMF.
- Groundwater Completed biological field work for effects monitoring.
- Wells continue to be installed, with 12 of 21 installed.
- Continued community and Indigenous agreement meetings, including meetings with the Missanabie Cree First Nation Community Benefit Agreement Implementation Committee and Environmental Committee and a call with Michipicoten First Nation.
Although work is now behind schedule, Argonaut says it will condense the work schedule and bringing additional contractors to the site. The first gold pour is expected by the end of March 2023.