Bald Mountain Doubles Reserves For Mine Life Extension
TORONTO, ON - Kinross Gold Corporation reported that Bald Mountain, the company doubles proven and probable mineral reserves to 2.1 million gold ounces (Au oz.) for a potential significant mine life extension. The Tasiast Phase One development is on schedule and on budget. Engineering and procurement are substantially concluded and major components for the SAG mill and primary crusher are now at site. Full commercial production is expected in Q2 2018. Phase One is expected to almost double production to approximately 400,000 Au eq. oz. per year at an all-in sustaining cost of $760 per Au oz.: Phase Two - Feasibility study progressing well and is expected to be completed in Q3 2017, at which time the Company expects to make a development decision. The Phase Two project is expected to produce approximately 780,000 Au eq. oz. per year at an all-in sustaining cost of $665 per Au oz.
The Round Mountain Phase W upgraded 1.3 million Au oz. to measured and indicated mineral resources and added 1.7 million Au oz. to inferred mineral resources1 through geologic modelling, drilling and re-engineering of the Phase W project1. The Phase W feasibility study is expected to be completed in Q3 2017.
The exploration activities at Bald Mountain, Round Mountain, Kupol and Dvoinoye added a total of 1.06 million Au oz. to the Company's estimated proven and probable mineral reserves and a total of 0.43 million Au oz. to its inferred mineral resources. Kinross is intensifying its exploration focus to extensions of known zones and mineralization at current mines, based on past successes extending mine life with this exploration strategy. The company is prioritizing exploration drilling at several operations, including Kupol, which is open at certain zones, and Fort Knox, where drilling is targeting opportunities for mineral resource additions.
The proven and probable mineral reserve estimates at year-end 2016 were 31.0 million Au oz. compared with 33.2 million Au oz. at year-end 2015, with additions at Bald Mountain partially offsetting depletions over the year. Measured and indicated mineral resources estimates were 30.3 million Au oz., a 7% increase compared with year-end 2015.
J. Paul Rollinson, President and CEO, said, "We have made excellent progress advancing the organic development projects that will shape the future of Kinross and look forward to achieving key milestones in 2017. These exciting projects span all three regions and are expected to help Kinross extend mine life to maintain strong, consistent production and cash flow in the years ahead.
"With the Tasiast Phase One expansion on track to reach full commercial production in Q2 2018, the Company expects to complete a feasibility study for Phase Two in Q3 2017 and make a development decision at that time. Phase One is expected to almost double production and reduce operating costs by nearly half while Phase Two is expected to once again significantly increase production to approximately 780,000 Au eq. oz., further reduce cost, and extend mine life to 2030.
"At Bald Mountain, we have doubled mineral reserve estimates ahead of schedule, confirming our vision for the mine as a long-life asset with significant upside potential. At the Round Mountain Phase W project, we have upgraded mineral resource estimates and expect to complete a feasibility study in Q3 2017 to potentially extend mine life. In Russia, stripping at September Northeast has begun, and mining at Moroshka is scheduled to begin in the first half of 2018, while 2017 exploration will follow up on encouraging targets in the existing Kupol mine footprint, which is open at certain zones, to potentially extend mine life."
The Company continues to develop the mine's potential for a significant mine life extension and production expansion. At year-end 2016, the company doubled Bald Mountain's proven and probable mineral reserve estimates to 2.1 Au Moz., adding a total of 1.24 Au Moz., with approximately 0.68 Au Moz. from the North area, and approximately 0.57 Au Moz. from the South area. The mineral reserve additions in the North area are primarily the result of continued exploration, definition drilling and mine plan optimization at the Saga, Duke and Top pits.
The mineral reserve additions in the South area are a result of the Company's pre-feasibility work at the Vantage Complex project, and exploration and confirmatory drilling, geological modelling and metallurgical testing at the Vantage, Luxe and Saddle pits. The pre-feasibility study also contemplates construction of a new heap leach pad with associated processing facilities and infrastructure. The preliminary capital estimate for the Vantage Complex project is expected to be in the range of $90 - $120 million, with major works expected to begin in the first half of 2018. The proposed design of the facilities allows for the full development of the Vantage, Luxe and Saddle pits, which have a combined 28 million tonnes of ore at an average grade of 0.63 g/t, and makes accommodation for future development of additional potential satellite pits in the South area, with forecast incremental capacity for 34 million tonnes, for a total capacity of 62 million tonnes. Kinross envisions Bald Mountain as a long-life asset with significant upside potential and mineral resource growth.