Kinross Gold (KGC) Offers Updates at Three Mines
Get the Pulse of the Market with StreetInsider.com's Pulse Picks. Get your Free Trial here.
Kinross Gold (NYSE: KGC) announced operational updates at its Bald Mountain mine in Nevada, Tasiast mine in Mauritania and Maricunga mine in Chile.
At Bald Mountain, the Company has received a record of decision from the U.S. Bureau of Land Management to allow for increased exploration activities and the mine's potential expansion.
The decision allows the Company to expand existing mine facilities and provides significant flexibility for future growth, such as additional heap leach capacity and a carbon adsorption plant, beyond what is required in the current mine plan. The decision, among other exploration activities, will also allow the Company to complete modest infill and metallurgical drilling to potentially increase the mine's mineral reserve estimate, and construct and operate new facilities in the North and South areas of the land package.
The Company is focused on developing two sets of deposits, the Vantage Complex and Yankee pits in the South area, and the Saga and Duke pits in the North area. Developing these deposits may substantially increase the current 1.1 million Au oz. mineral reserve estimate(1) at Bald Mountain and extend life of mine.
At Tasiast, the Company resumed normal mining and processing operation in mid-August, following the temporary suspension caused by the expatriate work permit issue. Two major construction contracts regarding earthworks and concrete works have also been awarded for the Phase One expansion project.
In its Q2 2016 results news release, Kinross announced that the Company and the Government of Mauritania resolved the expatriate work permit issue as part of reaching a mutually acceptable "Mauritanization" plan to increase the number of local workers who have the necessary skills and experience to work at Tasiast, a requirement under Mauritanian law. As well, labour negotiations respecting the Company's collective labour agreement at Tasiast are expected to recommence in the next two weeks.
At Maricunga, the Company has placed the mine into suspension. As previously disclosed, due to other capital priorities in its global portfolio, the Company decided to suspend mining at Maricunga in Q4 2016.
The suspension was implemented earlier than planned after a judicial decision in Chile concluded that the country's environmental regulatory authority's (SMA) revised June 24, 2016 sanction was enforceable. The sanction, among other things, substantially reduced water pumping at Maricunga, which caused the mine to suspend mining and crushing activities and curtail processing at the end of July 2016. The advanced timing of suspension at Maricunga is not expected to affect the Company's 2016 production and cost guidance.
Kinross continues to vigorously oppose the SMA's unprecedented actions and has various appeals pending with Chile's Environmental Tribunal. The Company disagrees with the original resolution on which the subsequent SMA orders are based, as it is technically and legally flawed and relies on contested scientific findings. Kinross is committed to responsible environmental management and has taken numerous measures and performed various studies over the years to understand the causes of the current situation and mitigate impacts of its water use. The Atacama Region, where Maricunga is located, has also suffered from a protracted drought for many years, resulting in a drop in groundwater levels across the region that is unrelated to the mine's operations.
As a result of the suspension, the Company is reducing its mining and crushing workforce at Maricunga by approximately 300 employees. Kinross will continue to explore further permitting efforts and review the operation and its mineral resource model to consider possible options for re-starting mining. The Company continues to advance permitting efforts at the nearby La Coipa project with exploration work also continuing this year.
At December 31, 2015, the Maricunga mine had estimated proven and probable mineral reserves of 1.042 million ounces, estimated measured and indicated mineral resources of 4.275 million ounces and estimated inferred mineral resources of 1.053 million ounces1. The mineral reserve estimates were prepared using a $1,200 per ounce gold price, and the mineral resource estimates were prepared using a $1,400 per ounce gold price.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Raytheon (RTN) Elects James Winnefeld Jr. to Board of Directors
- Mallinckrodt (MNK) to Pay $100M to Settle FTC, State Charges for Violating Antitrust Laws
- MDC Partners (MDCA) Settles with SEC Over CEO Perks
Create E-mail Alert Related CategoriesCorporate News
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!