Kinross Gold's Buckhorn Mine Is Now Operational
TORONTO- Kinross Gold's Buckhorn mine, located in Okanogan County, Washington, is now operational, and trucks have begun to haul ore from the mine site 26 miles to the refurbished Kettle River mill in Republic, Washington, which has produced its first gold. Ore production at Buckhorn is ramping up as mine development advances. The mill will continue to process stockpiled ore from the former K2 mine through November, with bulk milling of ore from the new Buckhorn mine.
In the third quarter, exploration drilling continued at Buckhorn (12 holes drilled for 4,115 meters) and the K2 mine (three holes for 1,470 meters). A second core drill will be added in the fourth quarter to complete 2008 planned exploration at Buckhorn. Soil geochemistry and an induced polarization (IP) geophysical survey were carried out on the expanded claim block to identify new Buckhorn-style skarn targets. Calc-silicate alteration intersected in Q2 drill holes in skarn units beneath the Buckhorn deposit returned weakly anomalous gold. Further work is warranted to better understand the significance of these results and to vector to gold mineralization within these deep skarn lenses.
Projected production for 2008 is approximately 20,000-30,000 ounces, at an expected average cost of sales per ounce of $365-385. Kinross acquired the Buckhorn property in north-central Washington State through the acquisition of Crown Resources in 2006.
Construction on the Fort Knox heap leach project in Alaska has been concluded for the season and is scheduled to restart in the spring. Construction is complete on approximately 78% of the leach pad area required for initial ore placement and leaching. Construction on the carbon-in-column plant will continue through the winter months and is expected to be completed in the first quarter of 2009. Start-up of leaching operations is scheduled to commence in the third quarter of 2009.
In exploration at Fort Knox during the thrid quarter, the Phase 7 pit expansion program was completed. Total drilling on the program was 88 holes for 29,447 meters. Three concept holes testing mineralized extensions in the south wall of the pit returned positive results. A 14-hole follow-up program was initiated at the end of the quarter. Results of drilling on the Fort Knox trend (5 holes, 806 meters) returned some anomalous to ore grade intercepts that will be followed up in 2009.
At Round Mountain in Nye County, Nevada, tonnes of ore mined during the third quarter of 2008 were higher than in the third quarter of 2007. Gold equivalent ounces produced were lower than the prior year primarily due to reduced performance of aging heap leach pads. Metal sales for the third quarter were $55.5 million, an 11% increase over the same period last year, more than offsetting lower gold equivalent ounces sold in the third quarter of 2008. Cost of sales increased during the third quarter, primarily due to increases in the cost of diesel fuel and other consumables.
Gold equivalent production1 for all of Kinross' operations was 551,510 gold equivalent ounces in the third quarter of 2008, an increase of 47% over the third quarter of 2007 and 36% over the second quarter of 2008, representing a new quarterly record for Kinross. Consistent with previously stated guidance, the Company remains on track to produce approximately 1.8-1.9 million equivalent ounces in 2008.
Kinross is a Canadian-based gold mining company with mines in the United States, Brazil, Russia and Chile, and employs approximately 5,000 people worldwide. The Company's address is 42nd Floor, Scotia Plaza, 40 King Street West, Toronto, ON M5H 3Y2 Canada, (416) 365-5123, fax (416) 363-6622.