IAMGOLD Corp. has inked a deal to form a joint venture with Japan's Sumitomo Metal Mining Co. Ltd. for the Cote gold project in Ontario.

The Canadian miner said June 5 that Sumitomo will pay US$195 million to take a 30% stake in the project, which will be operated by IAMGOLD.

The two companies have been in talks regarding a potential partnership since August 2016.

Separately, IAMGOLD revealed that a prefeasibility study estimates the Cote project will have an after-tax net asset value of US$703 million and internal rate of return of 14%.

President and CEO Steve Letwin said the project is expected to produce 320,000 ounces of gold each year for 17 years.

Initial CapEx is forecast to be US$1.05 billion, while all-in sustaining costs are placed at US$689 per ounce. The study estimates payback will take about 4.5 years.

IAMGOLD said the results of the prefeasibility study clear the way for the start of a feasibility study.