Earnings Call: Q3 2020

Nov 5, 2020

Thank you for standing by. This is the conference operator. Welcome to IAMGOLD Third Quarter 2020 Operating and Financial Results Conference Call and Webcast. As a reminder, all participants are in listen only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. Thank you very much, and welcome, everyone, to the IAMGOLD Third Quarter 2020 Conference Call. Joining me today on the call are Gordon Stothart, President and Chief Executive Officer Carol Bandicchi, Executive Vice President and Chief Financial Officer Bruno Lanolin, Senior Vice President, Operations and Projects Craig McDougall, Senior Vice President, Exploration and Tim Bradburn, Vice President, Legal and Corporate Secretary. Our remarks on this call will include forward looking statements. Please refer to the cautionary language regarding forward looking information in our disclosure documents and be advised that the same cautionary language applies to our remarks during the call. With respect to the technical information to be discussed, please refer to technical information and qualified persons slide. The slides referenced on this call can be viewed on our website. I will now turn the call over to our President and CEO, Gordon Stothert. Well, thank you, Indi. Good morning, everyone, and thank you for joining us. Last night, we issued our Q3 2020 operating results reflecting how we've adapted to our new normal with COVID-nineteen, solid operating cash flows of $105,000,000 on increased margins and solid mine site free cash flows of $80,000,000 underpinned by production of 159,000 ounces of gold despite the challenges of the quarter. Our strong balance sheet supplemented by the enhanced flexibility from our debt refinancing wherein we issued new bonds and retired the old bonds, extending the maturity date by 3 years to 2028 and lowering our annual interest rate costs and the transformational growth we anticipate with the Cote gold project following the formal construction announcement in July. As reported on Monday, we had a seismic event at Westwood with all employees safely brought above ground. I would like to recognize our Westwood team for their safe and successful response to this event. The Westwood Mill restarted yesterday evening on stockpiles and open pit ore from Grand Duke, while the underground operation remains suspended as we assess our business continuity plan. We are now in our From rapid A rapid crisis response at the end of the Q1 through extended rotations at Essakane, a shutdown and restart at Westwood, suspension and restart at Rosebel. We have come full circle with embedded protocols, operations at full capacity or close to normal, 0 COVID cases and ongoing vigilance. At Essakane, we completed the expansion of the sleeping quarters adding 200 beds. Operations are substantially back to normal capacity. At Westwood, following Quebec government's COVID-nineteen care and maintenance directive, we were back online as of mid April. At Rosebel, we continue to expand our camp capacity to facilitate social distancing, adding 300 beds, and we expect to be back to our full workforce complement in Q1 2021. For our construction project Cote, we have taken our learnings from our operating sites and instituted protocols including screenings, assessments, mandatory protective wear, social distancing and temperature tests. Our response to COVID-nineteen also has community support and engagement perspective. A few examples from the quarter include in Burkina Faso, where we donated 10 respirators worth $100,000 to the Ministry of Health and the Regional Health Directorate of the Central Region to support its COVID-nineteen efforts. Essakane further donated medical equipment to the Dory Hospital. And in Colombia, we provided financial support and technical training to 23 families in the beekeeping sector of the Anseoque municipality with expected production of 100 kilos of pollen and 1 of honey in 2020. This project comes as an economic alternative to improve the quality of life of these families. IAMGOLD is committed to achieving high standards in environmental, social and governance practices, which reflected our long held Zero Harm vision. Highlights from the quarter include recognition in rankings by Moody's affiliate, Biggio Iris as 4th out of 45 Sector Peers, including senior producers on its assessment of environmental, social and governance practices. IAMGOLD's assessment reflected notable strengths in community involvement, environmental strategy, health and safety and governance. Donations to local communities totaled $1,500,000 year to date, including cleaning equipment and supplies such as handwashing stands and hand sanitizing gel, protective medical equipment, including masks, gloves and face shields, and life support equipment in the nature of ventilators and hospital beds. EsaCann's respirator donations, as mentioned on the prior slide, and our Rosebel operation has partnered with Global Impex, a global personal protective equipment supplier to provide previously trained women in the community with internship opportunities at 1 of Global Impex's local factories. We are also lobbying our partners and other stakeholders for the 2nd phase of the Trangdolgo project in Burkina Faso, now that Phase 1 has been completed, with the goal of extending water infrastructure to 2 other communities nearby our Essakane mine. Looking at 2020, we have further refined our guidance. We are lowering our 2020 production guidance range to 630,000 to 680,000 ounces for 2020 due to the suspension of operations at Westwood Underground resulting from the seismic event reported earlier this week. We are adjusting upward our cost of sales guidance by approximately 5% to between $10.45 $10.75 per ounce sold. Total cash cost guidance is adjusted upward by approximately 4% to between $9.80 $10.10 per ounce sold, and all in sustaining costs are adjusted upward by approximately 3% to between $12.40 $12.70 per ounce sold. The revisions to cost of sales and total cash costs reflect higher costs incurred from processing lower grade stockpiles to compensate for lower levels of production as a result of the COVID-nineteen crisis. All in sustaining costs were adjusted to reflect higher operating costs incurred to date, lower Westwood production and higher royalties. I would note here that we are withdrawing our 2021 production guidance, which had been under review and expect to provide a regular annual guidance in early 2021. Our outlook for capital expenditures was modestly adjusted. At Essakane, the non sustaining capital expenditures forecast was increased by $5,000,000 to $70,000,000 At Westwood, sustaining and non sustaining capital expenditures have been decreased by $10,000,000 $8,000,000 respectively. At Cote, our development capital expenditures for 2020 were revised down to $66,000,000 from $77,000,000 reflecting a timing difference for expenditures. At Boto, planned capital expenditures were lowered by $1,000,000 to $24,000,000 for 2020. These adjustments reflect a net decrease of $10,000,000 in our sustaining capital and a net decrease of $15,000,000 in our non sustaining capital guidance. Our resulting updated total capital spend for 2020 is expected to be $325,000,000 for a net decrease of $25,000,000 versus prior guidance. In the quarter, we have progressed in a number of areas. At Rosebel, we continue to ramp up Saramacca production with an aim to complete the road by year end. We continue to expect to be at the target run rate for mining at Saramacca later in the year. We advanced the mill optimization project Grand Duke open pit with the Grand Duke pit providing Grand Duke open pit, excuse me, providing supplemental ore. We also continued derisking Boto with investment in local infrastructure and advancement of detailed engineering. In exploration, we continued our resource delineation work at various projects, including Nelligan, the Rouen project and the recently acquired Fayeul property in Quebec, as well as Goscelin near Cote and the new Corita discovery in Guinea. As we have indicated before for 2021, Westwood has potential to expand production with supplemental feed from the Grand Duke open pit subject to the assessment of our business continuity plan. We also see Rosebel production ramping up with Saramacca online and an optimized Essakane Mill to demonstrate increased throughput. For our growth projects, the Cote work plan will be focused on major earthworks during 2021, while we continue to derisk the Boto project. And for Goscelin, we are targeting a maiden resource. On that note, I will pass the call over to Carol to review our financial results. Thank you, Gord, and good morning, everyone. We are pleased to say that the company continued its trend of robust gold margins in the 3rd quarter, demonstrating both strong operating cash flows and strong mine site free cash flows. We completed a bond refinancing for 4 $50,000,000 lowering the interest rate to 5.75 percent from 7% and importantly extending the maturity of the senior notes to 2028. Following this, credit agencies S and P and Moody's reaffirmed IAMGOLD's stable outlook. We continue our well established approach of prudently managing our balance sheet with cash, cash equivalents and short term investments of $897,000,000 excluding restricted cash of $30,800,000 at the end of the quarter and our largely undrawn credit facility of $500,000,000 We implemented a gold hedging strategy to mitigate gold price exposure and to further de risk the balance sheet during the Cote gold project construction period. The company intends under appropriate conditions to hedge 50% to 20% of the total production between 2021 mid-twenty 23 through a combination of options and our collars. During the quarter, we executed gold bullion collar option contracts with a minimum floor price of $1800 per ounce and a ceiling of $3,000 per ounce on 114,000 ounces for 20 21 18,000 ounces for 2022. Subsequent to the end of the Q3, we added to our gold hedge position for 2021 using a zero cost collar of 1600 dollars to $2,505 per ounce on 28,000 ounces as well as a collar of $1700 to $2,800 per ounce on 50,040 ounces. In the Q3, we also executed hedges for the Cote gold project, including Canadian dollar forwards for approximately 6% of our exposure at a blended exchange rate of 1.364 and 0 cost fuel collars for 90% of our exposure with floors starting at $33.80 per barrel and a ceiling of $50 per barrel. Our earnings before adjusting items were impacted by the redemption of the redemption premium paid on the early redemption of our 7% senior notes, a noncash loss on the embedded derivative related to the 7% senior notes, the time value of our input cost derivative in addition to COVID-nineteen expenses. We continue to expect depreciation expense in 2020 to be in the range of $245,000,000 to $255,000,000 with our cash taxes guidance remain unchanged at $30,000,000 to $45,000,000 Turning to the Q3 results. Revenues were $335,100,000 supported by strong gold prices when cost of sales were up compared to the same prior year period and the prior quarter. Adjusted net earnings for the quarter were $52,100,000 or $0.11 per share. Net cash from operating activities before changes in working capital totaled $108,400,000 Our gross profit margin has steadily improved quarter over quarter with the 3rd quarter at 23%. During this quarter, we are presenting mine site free cash flows, which reflects free cash flows from our operating mine sites with development capital and non mine site activities adjusted out. We believe this measure demonstrates how far we have come in the past year with $80,000,000 in mine site free cash flow, up almost 4 times from the Q3 of 2019. On a year to date basis, we have generated $145,500,000 in mine site free cash flows, up dramatically from just $3,700,000 year to date last year. Following the strength in gold prices and our prudent management of the balance sheet, our liquidity excluding restricted cash and including our largely undrawn $500,000,000 credit facility totaled $1,400,000,000 Again, our 5.75 percent bond for $450,000,000 is not due until 2028. Therefore, we are well positioned financially for the construction of the Cote Tingold project. Finally, our disciplined approach enables us to continue to be a leader among our peers with a net cash position and leading liquidity. Our liquidity combined with anticipated free cash flows from our existing operations together with our risk management measures is expected to enable us to cover the construction of our transformational Cote Gold project. I will now pass the call to Bruno to discuss operations. Thank you, Paolo. I am not as confident to the health and safety of our employees, and we are pleased to say that our statistics from the quarter continue to reflect this commitment. In the Q3 of 2020, we again achieved better than target rates for best DARS, which stands for days away, restricted or transfer duty and the TRI, which stands for total recordable injuries, recording 0.36 and 0.48 respectively per 200,000 hours worth. At the end of last week, we were tested on our current availability to work as needed and when needed to ensure the safety of our colleagues. I applaud our colleagues at Westwood for their success in ensuring the safety of our workforce. Our goal every day is to meet or exceed our safety targets, implementing and refreshing a number of initiatives to ensure a safer work environment, including a comprehensive battery based safety program. For the quarter, we are reporting total consolidated attributable production of 159,000 ounces, cost of sales of $10.98 per ounce sold, total cash cost of $1,006 per ounce produced and all in sustaining cost of $12.06 per ounce sold. I will now review each operation in turn. At the second, attributable gold production for the Q3 2020 was 94,000 ounces compared to 83,000 ounces in the 2nd quarter, reflecting a material increase in 3rd quarter production. Higher grades in the quarter relative to the Q2 were offset by the impact of geotechnical ore on recovery in line with expectation and by the impact of maintenance on throughput. We did have a slightly higher capitalized stripping in the Q3 compared to the Q2 with total cash costs impacted by higher royalties, while all in sustaining costs were impacted by maintenance, higher input costs and royalties. All in sustaining costs were $10.44 for the quarter compared to $11.23 in the 2nd quarter. COVID-nineteen protocols are now ended at Essakane with 0 cases and operations effectively back to normal. For the balance of 2020, we continue to expect the additive ore with the Atanda negative impact on recovery. But despite this, we expect a solid finish to the year. As Gord noted earlier, we now expect the mill optimization project to be delivered in the Q1 of next year due to equipment fabrication and delivery timing delays. At Hawesville, attributable gold production for the Q3 was 42,000 ounces impacted by the suspension which ended on July 24 and processing of low grade stockpiles mixed with ore material from Saramacca. At Saramacca, we resumed activity to complete the final construction touches on the whole road targeted for the Q4. I will remind you that we have been utilizing the whole road since the Q1 while this work was being completed. Total cash costs were impacted by lower production volumes and royalties with all in sustaining costs lower due to lower milling costs and sustaining capital. All in sustaining costs were $11.64 per ounce for the quarter. Our COVID-nineteen protocols have been updated with the camp extension underway. We expect to reach our normal workforce capacity in the Q1 of 2021 with our mining complement ramping up over the Q4. The Q4 is expected to be a full quarter of continuous mill operations. We expect to complete non critical for Saramacca in the first half of twenty twenty one. We are also in the preparatory stage of our upcoming collective labor agreement discussion. You can see our progress in this picture of the truck shop, the run of mine facility pad and the formworks and concrete at the facility pad. Westwood produced 23,000 ounces in the Q3 2020. In August September, we achieved record throughput rates. We achieved our target production by blending open pit Garnazzic ore with Westwood underground ore. The increase of proportion of Garnzik ore relative to the Q2 was due to the timing of stope sequencing along with higher granular contribution. The higher granular proportion contributed to higher total cash costs with all in sustaining costs also impacted by equipment replacement and deferred development. As a result, all in sustaining costs were high at $15.15 per ounce sold. To provide an update from our news release on Monday, the Westwood restarted yesterday evening, while the underground operation remains suspended. You would have seen this slide before, but I wanted to remind you that the hub and spoke model we have for Westwood is based on the excess capacity we have at the Niro, which acts as a hub with regional targets acting as spokes. This model would see Grazik ore field eventually followed by Fayol ore field, pending permitting with target production for Fayol commencing at the end of 2022 and running for 2 years. I will now provide an update on our construction project, Cotego. We believe the Cotego project needs the Citellia as a Tier 1 asset, boasting a long life potentially in excess of 18 years, 493,000 roll downs annually in the 1st 5 years on a 100 percent attributable basis, 2nd quarter total cash cost of $600 per ounce, 2nd quartile all in sustaining cost of $7.71 per ounce and location in the mining friendly jurisdiction with further potential upside from exploration. We expect the Cote gold project to provide tremendous value to Iron Gold with a net present value of $2,500,000,000 on a 100% basis and a gold price of $1900 per ounce and internal rate of return of 25.9%. We are proud to have strong stakeholder relationship with our joint venture partner, Sumitomo, as well as indigenous communities flying post in Matagami and of course, our northern communities. Today, detailed engineering for Cote has advanced to approximately 66%, and we expect to ramp up activities in Q4. These include early works activities such as leveling of the Kampang, fish salvage operation in the future tailings area, expansion of the Syt Texas road network and aggregate production. In the Q4, we plan to focus on CAM construction to increase the accommodation capacity on-site ahead of the imminent manpower ramp up. Other construction work will also include site preparation and the simulation of the fish salvage activity. Detailed engineering will continue to advance and procurement will focus on the fabrication phase for critical equipment. Major earthworks are on track to start in the Q2 2021. We have continued to advance our permitting for construction. We received 2 key permits under the Lakes and River Improvement Act. We received just yesterday the TMF starter dam approval under that act for the key priority structures under that application for construction. We received relevant environmental approval for dewatering activities within the tailings management for our TMF footprint to support construction of the TMF starter dam structure. We also received a permit to take water. We have few picture here from our groundbreaking official groundbreaking settlement in September, which was attended by the Prime Minister of Canada, Premier of Ontario, First Nation and other dignitaries and stakeholders. There are also some pictures of fish medication program underway. This slide really highlights Cote's sensitivity to the gold price with both after tax net present value and internal rates of return shifting dramatically up in the current gold price environment. While we are pleased to see this potential, our internal modeling for Coty is based on conservative prices and assumptions so that this project is defensively positioned for gold price volatility. I will now turn the call over to Craig to discuss development and exploration. Thanks, Bruno, and good morning, everyone. As usual, please note that the results I talked about today have been previously disclosed in accordance with securities regulations and signed off by the qualified persons within the company reporting them. In 2020, our planned exploration spend has been reduced to $41,000,000 from $52,000,000 excluding project development activities and studies. The main drivers of these adjustments were the various regional restrictions caused by COVID-nineteen during key program activity windows, followed by the usual work reductions from seasonal impacts such as the rainy season in West Africa. I have included here a few updates from the quarter. In Quebec, drilling activities resumed at the Nelligan project with 2,600 meters of diamond drilling completed from both infill and step out holes. Recall that resources on a 100% basis for the project totaled 3,200,000 ounces in an inferred category at a grade of 1.02 grams per tonne gold. We also reported assay results from the winter drilling program with highlights of 39.1 meters at 2.14 grams per tonne gold and 34.5 meters at 1.85 grams per tonne gold. At the Monster Lake Project located 15 kilometers north of the Nelligan project, we reported drilling results from the Annie Shear zone target, including 3.8 meters at 16.9 grams per tonne gold, 2.8 meters at 5.63 grams per tonne gold and 12.3 meters at 2.09 grams per tonne gold. Also during the quarter, our joint venture partner at Monster Lake, Tomagold announced that both companies had signed an asset purchase agreement under which IAMGOLD would acquire the remaining 25% interest in the project held by Tomagold. Upon closing, this will increase IAMGOLD's ownership to an undivided 100 percent interest in the project. The completion of the sale is subject to usual shareholder and regulatory approvals for Tomagold, which are expected in the Q4. We announced further results at the Ruane Gold project from our infill diamond drilling program to support the completion of a maiden resource estimate for the Latt Campbell zone, which we feel may have potential to provide future satellite feed to our Westwood operation. Highlights include 4.1 meters at 10.4 grams per tonne gold, 8.9 meters at 4.3 grams per tonne gold and 7.4 meters at 8.3 grams per tonne gold. During the quarter, we also completed some 5,600 meters of additional diamond drilling to evaluate the resource potential of the nearby historic Astoria deposit located several kilometers to the east of the before, industry reserves have been on a steady decline since 2012, representing a significant challenge to the future of our industry. IAMGOLD has worked hard to differentiate ourselves from this industry trend. Our objective is more than just replacing reserves at the rate of annual mine depletion, also to grow and expand our reserves. Because mine sites constantly deplete reserves and eventually mature, reserve replacement becomes increasingly difficult over time. To counter this, resource and reserve growth must also be achieved through exploration success at greenfield development and early stage projects. As shown on the slide, our success to date has been commendable. Besides our continued efforts at our mine sites and development projects, our greenfield exploration program has delivered a number of important exploration discoveries that will continue to supply the building blocks necessary to not only sustain reserves, but to provide opportunities for further reserve growth in the years ahead. As I have said many times, this can only be achieved through a sustained commitment to exploration through the cycle and of course the tireless dedication of our mine geology and exploration teams. At the Cote gold project, we were able to advance our work relating to assessing the resource potential of our new Gosselin discovery located 1.5 kilometers northeast of the Cote gold deposit. Drilling activities resumed during the Q3, and we completed approximately 3,000 meters of diamond drilling from a barge supported program. Drilling continues to focus on infill and step out drilling to support an initial resource estimate expected in 2021. Switching gears a little bit to talk about development at Bodo, we continued de risking activities in the quarter with detailed engineering advancing to approximately 50% complete. Activities included engineering and preparations for the access road construction and upgrades to the installation of a can. We also awarded engineering contracts related to plant equipment design as well as for the start of construction of the access roadside. Restrictions related to COVID-nineteen crisis have delayed the advancement of certain local site initiatives such as community engagement in environmental activities. We expect to reschedule these as local conditions allow. In West Africa, exploration activities were restricted during the Q3 due to the rainy season. Efforts focused on data compilation of exploration results and target generation to guide future programs across our portfolio. At the Boto Gold Project in Senegal, drilling data obtained in the previous quarters is being incorporated to refine the resource and reserve models. Again, highlighting our exploration success along this portion of the San Miguel Malay Shear zone with several discoveries located within 15 kilometers of the Boto Gold Project in adjacent countries, we are working to advance a strategic development concept we refer to as the Bamboo Gold Complex, which will prioritize and advance resource development and delineation programs at the Dayakasirubaya and Corita projects to support the evaluation of potential development scenarios and identify regional synergies. Finally, I will finish with our project pipeline. A robust and balanced project pipeline strategically assembled and advanced is a fundamental asset to the future viability of any mining company. And this is even more important in the current environment of bullish gold prices and declining global resources. Competition for and access to quality exploration projects at acceptable entry costs remains challenging for the industry. IAMGOLD has developed and continues to invest in a healthy pipeline of early to advanced greenfield exploration projects to support our future growth as well as support near mine brownfield exploration with a view to ascend mine lives and leverage our existing infrastructure. With that, I will now pass the call back over to Gord to conclude. Well, thanks, Craig. So IAMGOLD's transformational strategy centers on delivering the top tier Cote gold project, de risking the Boto gold project, optimizing our current operations and continuing to invest in our pipeline of brownfield and greenfield exploration. Together with our financial strategy of maintaining a strong balance sheet, opportunistically securing favorable hedges on cost inputs and protective hedges on a portion of gold production during Cote construction, we believe IAMGOLD is positioned to deliver on its goal of superior returns to shareholders. In this context, we look forward to updating you on our ongoing progress at our operations and at Cote. I would like to close by acknowledging the hard work and dedication of our teams across the globe in these particularly challenging and unusual times. And thanks to everyone for joining our call today. And I'll now pass the call back over to the operator. Thank you. We'll now begin the question and answer session. Our first question is from Fahad Tariq from Credit Suisse. First on Westwood, look, I think there's been a history of seismic events at the mine and you've revised the mine plan already and tried to accommodate or deal with it a little bit. What more can be done that is in the company's control? And is there an increased focus now on brownfield exploration near Westwood, perhaps recognizing that the seismic events at the underground mine might be just a reality going forward, so maybe there's other deposits that need to be brought forward. Thanks. Yes, I'll take that one Fahad. Look, obviously, we're still investigating what happened with this specific incident. It was in an area distinct from earlier incidents and it's also in an area in a different rock unit than the prior incidents. But it was an area that was developed before the last round of engineering that was done. And the work we're looking at going forward is focusing on a different type of development sequencing. So, we'll continue to look at it. We are aggressively looking at the hub and spoke model and what the regional opportunities are. And some of that is in hand and we're just in the process of permitting or developing it, including Grand Duke and Sayul. Obviously, the opportunity at Rouen Gold continues to improve for us the more we drill it out. And as we complete our business recovery plan at Westwood Underground, we'll assess what that opportunity is. At the end of the day, our goal is to have a safe, profitable operation. And that will be 1st and foremost in our minds. If we're not able to achieve that safety, we'll have to adapt the plan going forward to get us there. Okay, great. And my only other question, on the cost guidance that's higher now, how much of that is Westwood related, meaning lower production? How much of it is something else? Because I'm trying to bridge that with, I think in another slide you said that the COVID incremental COVID costs are not being included in the unit costs. So it sounds like the higher cost guidance is not necessarily COVID related. Maybe just some color on the components of the higher cost guidance, that would be helpful. Thanks. Yes. I don't have a detailed breakdown of the components of the cost, but the adaptation in the cost is related to the incident at Westwood and us taking a conservative view of what the rest of the Q4 is going to look like at Westwood and what the impacts then were on our consolidated costs. We looked at it fairly closely. There are some impacts with lower production in Q3 from Rosebel, although that certainly is ramping up nicely and seeing some nice costs sorry, some nice production out of Essakane as well. In the absence of the event at Westwood, I don't believe we would have adjusted all of the cost parameters. We may have adjusted one of them just to adapt to the actuals from Q3. But it certainly was a significant driver for the decision to modestly change our cost guidance. And Gord, maybe if I could add to that. And what we are also seeing is higher royalties as a result of the higher gold price. And we had to push off some of our sustaining capital during COVID occurrences at the mine site. So you'll see more of that coming into the Q4. Okay, that's clear. That's it for me. Thank you very much. The next question is from Jackie Przybylowski from BMO Capital Markets. Please go ahead. Thanks very much. I guess on my first question, I just want to follow-up with Fahad's first question on Westwood. The guidance revision you gave for 2020, specifically the production guidance at Westwood, do you assume in that production guidance that Westwood restarts in Q4 2020 or is the guidance reflecting processing of lower grade stockpile ore through the entire quarter? So, Jackie, yes, we took a very conservative view. We have we've obviously started our investigation, but we don't want to be pressuring the operation to restart until we're ready to restart. The guidance is based, as you sort of stated, on the production up until the actual incident, so basically through the end of November and sorry, the end of October, and then 2 months of processing from the open pit and from stockpiles. That's what that guidance analysis is based on. So, yes, I guess that's helpful because we can't read into your guidance that you're expecting 2021 to be back up and running at full run rate or anything like that. It's still open ended in terms of when the restart will happen and what it would look like? Well, as we said, I think starting with the Q1 and Q2 results, we have been reviewing the 2021 guidance and not obviously just for Westwood, but also the larger picture. At this point in time, we're withdrawing that guidance and we'll be working really diligently over the next couple of months to firm up what the picture looks like going forward. And as of right now, pending the outcome from this investigation, we're not comfortable saying anything about Westwood until we understand it. We will be updating in early in 2021 with 2021 guidance for the larger picture as well. Okay. That's helpful. Thank you. And my second question would be on the hedge program that you've reported for 2021, I guess, specifically. So you've said that you're aiming for about 15% to 20% of total production. I mean, I'm assuming that's attributable production to IAMGOLD. And based on that and based on the information that you gave, it looks like you're kind of there for 2021 already with the hedges that you've disclosed. Is that fair? Or do you expect that you'll be adding additional hedges for 2021? Or do you think that you're sort of at your target already for next year? Hi, Jackie, it's Carol. Yes, that's it. Yes, you're spot on. So we have we don't expect to add anything further for 2021. We're there. And if you take a look at the weighted average on the floor, we're looking at $17.47 And on the ceiling, it's a weighted average of close to $2,900 So we're pretty comfortable with where we're sitting with 2021. Perfect. That was actually going to be my last little tiny question. So thanks very much for that Carol. And that's it for me. Thanks. Thanks everybody. The next question is from Anita Soni with CIBC World Markets. Please go ahead. Hi, good morning everyone. Just a little further on Westwood. Gord, you mentioned it was in a different zone that were separate from where the previous issues have occurred. Can you just remind me which zone that was? I'm just trying to think of what information is out there, but I think you had labels in 1, zones 1 through 6. Yes. I'm just trying to remember my sequencing there. What it is, it's the zone that's on the hanging wall side of corridor 2, whereas the prior incidents had been on the footwall side of Zone 2. Okay. But how close is it to the main infrastructure? It's a long it's quite distal from the main infrastructure. This was a set of workings to recover a zone that was a little bit further to the west. And we actually had have about 90%, 95% of that panel completely removed so far. Okay. And relative to the average grade of the assets there, how what was the average grade in that zone? You've got me there, Anita. I don't have it. My understanding was it was a reasonable grade. It was probably close to average grade. It wasn't the best material, but it certainly wasn't low grade. All right. And then just moving to 2021, I mean, I think within by Q1 or Q2, you had already started to talk about 2021 guidance not yet revoked, but definitely being under review. And this is all these prioritizing that was happening with Westwood, but more COVID related impacts. So outside of the Westwood impacts, can you talk about some of the other moving parts that might be impacting 2021 guidance? Like I think one thing that I would be thinking about would be just the slower ramp up at Rosebel this quarter post the COVID related shutdowns and how that kind of winds its way into 2021? Yes. I mean, that's you know us quite well, Anita. That is part of it. Obviously, with the impacts of COVID, we have resequent some of our zones and probably more at Rosebel, but at all the operations there has been some resequencing. So part of the guidance adjustment is to do with will be or once we have it in hand, we'll be really looking at those timing impacts and how that sequencing now falls in 2021. And just regular ongoing geologic assessments as to which how the different deposits are performing. It's part of the regular operation and we continue to look at it. The timing sequences due to COVID, I think, is probably the bigger impact. And obviously, now understanding Westwood is also a significant impact. Okay. And then my last question is back to Rosebel again. Just on the back of the I was just looking at the operations. It looked like Saramacca delivered some good grade and pretty good tonnage. But I guess the Rosebel proper was delivering a little bit more stockpile than I had anticipated. So can you just give us an idea of what the rest of like outside of Saramacca, what the ore split was in terms of stockpile and ore source from the Rosebel Pit? I'm going to have to turn that one over to Bruno. I mean, the impact really has to do with the ramp up of the workforce following the suspension and our work on the camp. So I know we got Saramacca back up and running relatively quickly on the main Rosebel section, we were mining we certainly were mining some priority pit. But given the reduction in the number of people that could stay in camp while we expand the camp, we were focusing on or weren't focusing, but we were actually exploiting some of the on-site stockpiles, the lower grade on-site stockpiles to keep the mill full. But I'll just let Bruno sort of expand on that. Hello, Bart. Yes. So we in Q3, we were able to ramp up our activity at South America close to 8,000 tonne per day after the resumption of our activities. Actually, we have close to 600,000 tonne of stockpile at Saramacca. So we'll continue the ramp up for Q4. That's what is done. Bruno, the question was for the Rosebel proper contribution, do we understand the tonnage split between stockpiles and direct pit feet in Q3? I would like to come back with the number. Yes. I just want to get an idea of like what the actual run rate is relative to full throttle production at the Rosebel Pit. Yes. Okay. Understood. Okay. Thank you. That's it for my question. Thanks. The next question is from Josh Wolfson with RBC. Another question on Westwood. Is there any sort of context you could provide as to what the damage is right now or maybe how it would compare to the prior sort of incidents on the 104 level? Bruno? Sorry, can you repeat the question, please? Is there any ability to characterize or quantify the level of damage as it would have compared to prior seismic events? I guess the closest one would be the 104 level incident a number of years ago? Yes. Well, as we mentioned, like we need to assess what caused this seismic event, okay? And like what you're saying is the impact on the production schedule right now in that zone. We were about to finish the and complete the mining of this zone. I would say, we'll have to be giving you more details after the initiation and looking after that what is the consequence of event on future production. We'll provide an update on these in due course. Okay. And is there any ability to maybe quantify the reserve volume that would be in that area? Mike, I mentioned, like so far, we were almost done with the zone. So at this moment, we're looking at the impact on the mine plan. But we in terms of valuation or reserve, that's not necessarily what we at this stage are evaluating more on the mining planning side. So the impact is less since it is in the far west of the mine to be exact. Okay. And then for Saramacca, you mentioned the stockpile that was in place. If I recall looking at the old tech report, mine plan, there was about a 2 ish year ramp up, including, I guess, 2021, which would have been in there, where the mine or Saramacca's contribution would be below its steady state. So when you say or the guidance for full throughput is expected at year end, Is that rate expected to be in line with what the old mine plan was or should that be close to that 60 7,600, 800 kind of tons per day processing from Saramacca? Yes. Actually, we see a stronger ramp up in Q4, definitely with a great impact at the mill. So the contribution for Saramacca for Q4 is expected to be furnished. As we speak right now, we are finalizing the land for 2021. So we will be able to guide on this with regard to what Salamanca is expected to give versus the original plan. Okay. And then last question, just in terms of gold price assumptions for year end reserves and resources, Any thoughts on that? Yes, Josh. We're not planning on moving our gold price assumptions on reserves or resources this year. As part of the overall strategy and we've said it a bunch of times, we really are focused on generating cash flow out of the existing operations, at least through the construction period for Cote. And at this point in time, we're not looking to modify cutoff grades and move away from that plan. In the medium term, if higher gold prices persist, and I hope and pray they do on a daily basis, At some point in the future, we will start to consider it looking at it. And specifically, most importantly, I think, in reference to Essakane, which has the shorter mine life and understanding what the impacts are. That being said, the long term planning group is evaluating on a regular basis what those impacts might be. But for corporate disclosure, we're not going to be moving our numbers. Great. That's all my questions. Thank you very much. Thanks. The next question is from Don MacLean with Paradigm Capital. Please go ahead. Good morning. Most of my questions on Westwood were answered. I guess it's unfortunate that relatively small contributor to the production and cash flow is occupying so much intellectual horsepower at the company. I mean, good. I guess the underlying question here is, at what point do you throw in the towel on this thing? Do you get to that point? Is it sufficiently profitable if you look at it from a macro perspective to be worth all this effort? Well, I mean, it's a great question, Don, and certainly the conversation we've been having internally. I think for us right now, we're going to wait for the analysis incident and what the business recovery plan is. I think our assessment will be like any assessment around any asset. Where are we best providing returns for our shareholders through our allocation of capital. And that'll be the question that our efforts at Westwood will have to answer in comparison to our other opportunities. It's too early to talk to that now. As I think I said and Bruno said as well, the incident really hasn't impacted our reserve ounces in a big way in any way shape or form. However, as we look at do we if we ask ourselves the question, do we need to modify anything else with respect to how we're mining this deposit to maximize hazard abatement, does that require a different capital profile than we had laid out through our prior plan? We haven't got it to that point, but it's a matter of it's a question of capital allocation. Obviously, following our ability to mine safely. Yes. I mean, it's a tough one when if we just stand back and look at it from a market perspective when you're being held sort of or judged operationally on something that is really totally out of your control. I mean, Essakane and Rosebel are challenging in their own rights, but it's something you can manage. But Westwood is just you get these situations that are totally outside of all your best efforts that really throw your whole sort of operational perception of the market off kilter. So it's most unfortunate. It'd be nice if you could somehow isolate it in some way that people could judge Essakane and Rosebel, the real backbone of the company on a fair basis, without being colored by Westwood. Those are the questions we're asking ourselves there now, Don. I agree. And can Grand Duke and Fayol and possibly Rouen could they actually sustain the mill as a profitable entity without the underground? Yes. Again, that's the question. None of them were intended to be 100% producers. So we'll have to look at it. Maybe there are other opportunities as well. And it really is a holistic picture. I mean, the hub and smoke concept that Bruno described very well, really the underlying assumption there was that Westwood was profitable in and of itself and providing a baseload fill of the mill. If that sequencing is different, then we need to evaluate sort of the overall picture. As you pointed out earlier, on most models, the proportion of value that's assigned to Westwood within our portfolio is relatively small. The whole hub and spoke concept that Bruno and the team at site and the team at Longue have been driving towards was to provide a longer term valuation superior to sort of the Westwood base case. And we'll need to understand it all sort of in a holistic way. And then just you may not be able to answer this, but have you ever had expressions of interests from potential buyers for Westwood? Yes. Like you say, Don, that's something we really we don't typically answer publicly until things get a little further along if that were to ever happen. Okay. Just thought I'd ask that question. And then lastly, Gord, any kind of color on 2021 compared to what we've seen in Q3? If we cross out Westwood, how Rosebel and Essakane will look in a broad sense? Will they look better or pretty much the same? At a high level, my expectation is Essakane will Essakane is a fairly steady producer along the lines. Yes, we had some COVID impacts this year. If you remove those COVID impacts, I think you'll see Westwood next year something comparable to the steady state without those impacts, obviously assuming that there's no further future impacts. And Rosebel, as Saramacca starts to deliver a big component, a bigger component of production on a sustained basis for a full year. We do start to see some improvement with Roosevelt. We're just in the process of dimensioning exactly how much that improvement is. And as I spoke to Anita's question earlier, at the same time, we're trying to understand what has the COVID impact done to our sequencing plan at Rosebel proper and how does that impact 2021. So we're right in the midst of putting all that together. This concludes the question and answer session. I'll now turn the call back over to Indi Gopinathan for closing remarks. Thank you very much. And thanks to everyone for joining us this morning and for your continued interest in IAMGOLD. We look forward to having you join us again for our Q4 and full year 2020 conference call in February. Goodbye. This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.