Kinross Gold announces Peak Gold project deal
risk “tuck-in” to supplement Kinross’ existing Alaska operation. Kinross plans to process Peak Gold ore at Fort Knox and utilize the existing mill and infrastructure to benefit both the project and the mine. Highlights of the acquisition: Adds another high-grade, low-cost development project to Kinross’ portfolio n Expect to commence production at the open pit project in 2024, with total production of approximately 1 million Au eq. oz. over 4.5 years at average mining grades of approximately 6 g/t. n Preliminary all-in sustaining costs2 estimated to be in the range of $750 per Au eq. oz. and initial project capital expenditures in the range of $110 million. n Expect to strengthen Kinross’ medium-term pro- duction and cash flow profile. n Numerous exploration targets within Peak Gold’s 675,000-acre land package to potentially increase mine life. Low-risk project leverages Fort Knox mill, infra- structure and successful operating experience in Alaska n Processing ore at Fort Knox avoids mill construc- tion and is expected to decrease execution risk, lower capital expenditures, drive attractive returns, and re- duce the project’s environmental footprint and permit- ting requirements. n Blending higher grade ore from the Peak Gold project with Fort Knox ore is expected to extend mill operation at Fort Knox, reduce overall costs and increase cash flow. n Leverages Fort Knox’s successful 27-year history in Alaska, one of the world’s top mining jurisdictions. Project to benefit local communities, in particular the Upper Tanana Athabascan Village of Tetlin n Project expected to contribute to the state econ- omy and provide additional employment opportunities and benefits. “The relatively high-grade, low-cost Peak Gold project is an excellent addition to our portfolio, as it allows us to leverage our existing mill and infrastruc- ture at Fort Knox and strengthens our medium-term production and cash flow profile. In today’s gold price environment, Peak Gold is an attractive, high-margin project that is expected to generate robust returns,” said J. Paul Rollinson, Kinross Gold President and CEO. “The project is also expected to add to our strong re- cord of socio-economic contributions to our host com- munities in Alaska, one of the top mining jurisdictions in the world.”
Contango ORE Inc. to maintain 30% minority interest in move Kinross Gold Corporation (TSX:K; NYSE: KGC) (“Kinross” or the “Company”) is pleased to announce that it has entered into agreements to acquire a 70% interest in the high-quality Peak Gold project in Alaska from Royal Gold, Inc. (“Royal Gold”) and Contango ORE, Inc. (OTCQB: CTGO) (“Contango”) for total cash consid- eration of $93.7 million. Kinross will have broad authority to construct and operate the Peak Gold project, with Contango retaining a 30% non-operating minority interest. The Peak Gold project is a relatively high-grade de- posit with a large estimated resource base that is ex- pected to commence production in 2024 as a low-cost, open-pit mine. The project, which is located approximately 250 miles southeast of the Company’s Fort Knox mine, is a low-
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The Alaska Miner
October 2020
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