Kinross to study expanded mine project in Mauritania; initial cost $2.7B

TORONTO – Kinross Gold Corp. (TSX:K) is going ahead with a full feasibility study aimed at a $2.7-billion expansion of its Tasiast open pit gold mine in Mauritania.

Kinross said Monday that based on a pre-feasibility study it is now considering a 38,000-tonne per day mill at the mine, up from a 30,000-tonne facility under consideration earlier.

The pre-feasibility study found that during the first five years of production, a 30,000 tpd mill would be expected to have average gold production of approximately 830,000 ounces per year, with average cash costs of about $500 per ounce, and average all-in sustaining costs of about $735 an ounce.

The expected initial capital cost would be approximately $2.7 billion.

In addition, the study considered utilizing the existing 8,000 tpd mill capacity at Tasiast in addition to a new 30,000 tpd mill.

“These studies concluded that a single new 38,000 tpd mill would be expected to provide the optimum economics for an expanded project,” Kinross said.

Based on these results, the company said it will immediately proceed with a full feasibility study with a 38,000 tpd mill, with the study expected to be completion in the first quarter of 2014.

“Although there is considerable work to be done at the feasibility study level before we decide whether to proceed with construction, the results of the PFS are encouraging,” CEO Paul Rollinson said Monday.

“As we continue to evaluate the project, we remain firmly focused on preserving the strength of our balance sheet.”