Iamgold (IMG.TO) can double the reserves at its Niobec niobium mine in Quebec using a paste backfill system to extract more ore, the Canadian company said on Monday.
It also announced cost-cutting measures at mines in Mali and Botswana.
Iamgold said a feasibility study had estimated capital costs of C$8 million to implement the Niobec plan, which would nearly double the mine's life to 20 years at current mining rates. The plan has not yet been approved by the company's board of directors, it said.
Currently, the company leaves ore grade material in the mine as supports as it moves to deeper levels. By backfilling to build supports, Iamgold will be able to extract more than 90 percent of the ore, rather than the 40 percent it currently gets, it said.
Niobium is typically used in steel alloys and jewelry.
The mine, located just outside Chicoutimi, Quebec, produces about 10 percent of world niobium consumption, Iamgold says. Daily milling capacity is 4,500 tonnes.
Iamgold also said it was hiring a new mining contractor at its 40-percent-owned Yatela gold mine in Mali and would take over mining operations at its fully-owned Mupane mine in Botswana from the current contractor.
The measures should cut operating costs by $40 per ounce at both operations, Iamgold said. Yatela produced 300,000 ounces of gold at a cost of $217 per ounce in 2007, while Mupane produced 86,000 ounces at a cash cost of $548 per ounce.
Iamgold's shares were up 12 Canadian cents at C$6.01 on the Toronto Stock Exchange.
(Reporting by Cameron French; Editing by Bernadette Baum)
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