A CCAFRICA MEMBER, IAMGOLD CEO STEVEN LETWIN INTERVIEW & ARTICLE
The Canadian Council on Africa (CCAfrica) is proud of the successes of its member IAMGOLD. Steven Letwin has been doing an excellent job as CEO of IAMGOLD and he shares a strong passion for Africa. With a vision of wanting to improve the standard of living of African’s at his core, Mr Letwin is continuing to demonstrate the strong value of Canadian companies. We invite you to listen to the interview and read the article below.
Why IAMGOLD could be the next gold major: CEO Steve Letwin interview
Can IAMGOLD make the move from a mid-tier gold producer to a major? The company’s CEO sure thinks so.
In an expansive interview recently taped in Nelson, British Columbia, Stephen Letwin touches on everything from IAMGOLD’s recent upward surge and why gold majors are facing serious challenges to his own upbringing and what he’s learned about leadership. For investors in the gold space, there is a lot of red meat.
Originally a senior executive in the oil business, Letwin was headhunted for the IAMGOLD chief executive position in 2010. His family and friends were initially puzzled by his decision to leave an oil career that, by his own admission, had made him “a lot of money.”
“I got a lot of pushback from a lot of friends who said, ‘Why would you take that risk?’” says Letwin. “I said, ‘I’ve got about 10 to 15 years to do something, I’d like to go and try that.’ As far as I could see, (IAMGOLD) is a great company with a great opportunity, and I took the risk, and it’s turned out to be a great opportunity.”
Lately, that opportunity has been great for both the company and shareholders. In late 2015 and early 2016 the company’s shares were trading below $2 – for the first time in the company’s history. At publication time the stock is hovering around $6.50 and seems poised for even more of a run. The company has brought costs down from over $1300/oz. to around $1000. And, the reserve life of IAMGOLD’s existing mines has been extended via a careful strategy.
“We started to focus on finding more gold in and around our infrastructure as opposed to spending a lot of money trying to find large deposits in other countries or in the same country,” says Letwin. “And, what that did for us, frankly, is it moved us significantly towards adding reserves.”
As part of this strategy IAMGOLD recently announced the discovery of a new deposit near their Rosebel Gold Mine in Suriname called Saramacca.
“We believe there could be up to 2 million ounces in a very small defined area where we’ve been drilling,” explains Letwin. “This is a mine (Rosebel) that four years ago had a life expectancy of 2018, next year. We’re now looking at what could be a 2030 mine life with all these extra resources. I think that’s why we’re the top performer here today, that’s why we were the top performer last year, and I believe we’re going to see some significant improvement in both our cost structure and our reserves going forward.”
IAMGOLD is planning to announce an initial resource estimate for the Saramacca deposit in September, but before that it plans to announce a reserves and resources update for the Rosebel mine concession towards the end of July.
“What we’re hoping to communicate to the market towards the end of July is an update of reserves and resources for Rosebel, which we’ve promised for some time,” says Letwin, “and I think and believe that the market is going to react quite favourably to the fact that, without even considering Saramacca – this large discovery made south of our mill – this mine has got a life of its own without help.”
The July announcement will add to news flow that emerged in early June when IAMGOLD struck up a joint venture deal with Japan’s Sumitomo Metal Mining. Sumitomo is paying $195 million for a 30% undivided participating interest in IAMGOLD’s ownership interest in the Côté Gold Project in Ontario – an exciting development for Letwin.
“(Sumitomo) paid $195 million to get into Côté and they’re committed to another $300+ million to develop it. This is a major success story for IAMGOLD.”
Ultimately, Letwin believes IAMGOLD can become a major gold producer. He would be pleased if the company is producing 1.5 million ounces within the next five years. In 2016 the company produced just over 800,000 oz.
“Can we become a major? We can!” declares Letwin. “I would like to see that done organically as opposed through acquisition.”
Interestingly, Letwin offers a candid assessment of the state of today’s major companies, like Barrick, Kinross and Agnico Eagle.
“I would tell you that the biggest challenge they have is depletion” explains Letwin. “They cannot replace what they’re producing on a timely basis, and if you’re looking at that as a gold investor, then we become extremely attractive.”
Letwin’s growth strategy has him excited about the future of IAMGOLD. But, it wasn’t always this way. Three years ago things were very different as IAMGOLD’s share price hovered around $2 and speculation mounted about Letwin’s future with the company.
“You become CEO and you’re front and center, and the share price drops, and you have shareholders who are angry and you’re at the front of the line – and you should be – when those redemptions are coming through…you grow up,” says Letwin. “It’s hard not to take it personally, and to some extent you always take it personally or you wouldn’t try and improve things.”
Letwin has been able to fight through those tough times and has IAMGOLD poised for some very interesting things. But, he’s taking it all in stride.
“The one thing you have to watch is don’t drink too much of your own whiskey now and become overconfident,” says Letwin wisely. “We’re seeing some good results, but it’s measured and let’s stick to the script and let’s move this along without becoming too full of ourselves.”