RENO (MINEWEB) - Kinross produced 604,247 attributable gold ounces in the firstquarter, a 6% drop over the first quarter of 2011, mainly due tobelow plan production at Tasiast, a scheduled decline in grade atKupol, and a planned increase in processing lower-grade stockpileore at La Coipa. Nevertheless, Kinross said it expects a production increase duringthe second half of the year in the North American, South Americanand West African regions. In financials released Tuesday, Kinross CEO Tye Burt said, "AtTasiast, mining activity has accelerated, infrastructureconstruction and permitting remain on plan, and we are makingprogress towards selecting an optimum processing approach for afurther expansion. Our exploration focus has shifted from infilldrilling to step-out and district targets along the 75-kilometerland position." Burt also noted the Kinross board has approved full constructionfunding for the Dvoinoye project, which is expected to deliver itsfirst ore to the Kupol mill in the second half of 2013. Productionat Kupol was lower during the first quarter due to reduced gold andsilver head grades of the mine as operations moved out of thedepleted high grade areas. |
Total life of mine gold production at Dvoinoye is expected to be1.1 million ounces of gold and 1.14 million ounces of silver.Annual gold equivalent production is expected to average 215,000 to250,000 ounces for the first full three years of production. Capexis estimated to be US$370 million. Meanwhile, Kinross is also continuing negotiations with theEcuadorean government on an improved economic package to developthe Fruta del Norte project. Burt said the company is "exploringopportunities to improve project economics at FDN as part of ouroptimization process." The company reported 611,838 gold equivalent ounces of productionduring the first quarter, down from 700,479 ounces of GEO duringthe same period of 2011.
Kinross reiterated that it expects toproduce 2.6 million to 2.8 million gold equivalent ounces this yearat a production cost of sales per GEO ranging from $670 to $715 for2012. FINANCIALS Kinross reported adjusted net earnings of $203.1 million or18-cents per share during the first quarter of 2012, up from $175.3million or 15-cents per share in adjusted net earnings reported infirst-quarter 2011. Net earnings were reported at $105.7 million or 9-cents per shareduring the first quarter of this year, down from net earnings of$250.1 million or 22-cents per share reported during thefirst-quarter 2011. Reported 1Q12 net earnings were affected by$110.3 million in tax liability as the result in the Ghanaiancorporate income tax rate from 25% to 35%. SUBSCRIBE to Mineweb.com's free daily newsletter now.
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