Kinross Gold Corporation (TSX:K; NYSE:KGC) (“Kinross” or the
“Company”) today announced that it expects to produce an average of
approximately 2.5 million gold equivalent ounces (Au eq. oz.)1 per
year from 2020 – 2029 driven primarily by promising organic
opportunities across its global portfolio.
The Company previously announced on September
17, 2020 that it expects to increase production by 20% from 2021 –
2023, with estimated production (+/- 5%)1 of 2.4 million Au eq. oz.
in 2021, 2.7 million Au eq. oz. in 2022, and 2.9 million Au eq. oz.
in 2023. Kinross also anticipates an overall downward trend in cost
of sales per ounce sold over its three-year growth profile.
Today, Kinross will host an operations update
and production outlook presentation and question and answer period
from 10:00 a.m. – 12:00 p.m. ET to discuss the details of the
Company’s 2021 – 2023 guidance. The Company will also provide an
overview of the production, exploration and mine life extension
opportunities that underpin its production outlook to 2029, and
details on additional opportunities in its portfolio that could
further strengthen its long-term production outlook.
CEO commentary: J. Paul
Rollinson, President and CEO, commented on Kinross’ long-term
production outlook.
“Our growing production profile and declining
cost trend over the next three years are expected to drive strong
free cash flow performance, placing Kinross in an excellent
position to generate substantial value for our shareholders.
Furthermore, our positive long-term production outlook, with
estimated average annual production of 2.5 million Au eq. oz. to
2029, provides a solid foundation to continue building value into
the future.
“Kinross has a diverse global portfolio with
top-tier assets that have long mine lives complemented by a large
mineral reserve and resource base. The reinvestments in our
portfolio, continuous improvement initiatives and exploration
programs have enabled us to add lower cost and lower risk projects
that leverage existing infrastructure and enhance our long-term
production profile. Our strong production profile, combined with
our robust financial position and recently reinstated quarterly
dividend, point to an exciting future for our Company.”
2021 – 2023
outlook
Kinross’ growing production outlook from 2021 –
2023 is based on expected additional ounces from:
- higher planned production at Kupol
and planned life of mine extension at Chirano, both derived from
successful exploration programs;
- expected enhancements to the Fort
Knox mine plan, including accelerating production at the Gilmore
project to bring ounces forward and mining the Gil satellite
deposit;
- continued outperformance at
Paracatu through expected improvements in throughput, more ounces
from the tailings reprocessing and accelerated mining of the
western area of the pit, and;
- higher anticipated production from
the north area of Bald Mountain.
Strong long-term production
profile
Kinross’ strong long-term production profile is
based on long-life assets that anchor the Company’s global
portfolio, along with numerous growth projects in all operating
regions. These growth projects, which range from scoping through
feasibility study level of confidence, include:
- Udinsk, the first deposit expected
to be developed on the Chulbatkan license in Russia;
- the recently acquired Peak project
in Alaska;
- the Phase S extension at Round
Mountain in Nevada, and;
- the Lobo-Marte project in
Chile;
The Company is also studying further organic
development and exploration opportunities given its attractive
pipeline of projects and flexibility of its portfolio in a
favourable gold price environment.
Call-in details for today’s
presentation at 10:00
a.m. ET
Canada & US toll-free – +1
(833) 968-2237; Passcode: 7245896Outside of Canada &
US – +1 (825) 312-2059; Passcode: 7245896
Replay (available up to 14 days after the
call):
Canada & US toll-free – +1
(800) 585-8367; Passcode: 7245896Outside of Canada &
US – +1 (416) 621-4642; Passcode: 7245896
You may also access the conference call on a
listen-only basis via webcast at our website www.kinross.com. The
audio webcast will also be archived on www.kinross.com.
Today’s presentation is
available here:
https://www.kinross.com/operations-update-strong-long-term-production-profile
About Kinross Gold Corporation
Kinross is a Canadian-based senior gold mining
company with mines and projects in the United States, Brazil,
Chile, Ghana, Mauritania, and Russia. Kinross maintains listings on
the Toronto Stock Exchange (symbol:K) and the New York Stock
Exchange (symbol:KGC).
Media Contact Louie DiazSenior Director,
Corporate Communicationsphone:
416-369-6469louie.diaz@kinross.com
Investor Relations ContactTom
Elliott Senior
Vice-President, Investor
Relations phone:
416-365-3390 tom.elliott@kinross.com
Cautionary statement on forward-looking
information
All statements, other than statements of
historical fact, contained or incorporated by reference in this
news release including, but not limited to, any information as to
the future financial or operating performance of Kinross,
constitute ‘‘forward-looking information’’ or ‘‘forward-looking
statements’’ within the meaning of certain securities laws,
including the provisions of the Securities Act (Ontario) and the
provisions for ‘‘safe harbor’’ under the United States Private
Securities Litigation Reform Act of 1995 and are based on
expectations, estimates and projections as of the date of this news
release. Forward-looking statements contained in this news release,
include, but are not limited to, those under the headings (or
headings that include) “CEO commentary”, “2021 – 2023 Outlook”,
“Strong long-term production profile” and “Company remains on track
to meet 2020 guidance” and include, without limitation, statements
with respect to: our guidance for production, production costs of
sales, cash flow, free cash flow and capital expenditures; the
declaration, payment and sustainability of the Company’s dividends;
optimization of mine plans; identification of additional resources
and reserves; the schedules and budgets for the Company’s
development projects; mine life and any potential extensions; the
Company’s capital reinvestment program and continuous improvement
initiatives and project performance or outperformance, as well as
references to other possible events, the future price of gold and
silver, the timing and amount of estimated future production, costs
of production, operating costs; capital expenditures, costs and
timing of the development of projects and new deposits, estimates
and the realization of such estimates (such as mineral or gold
reserves and resources or mine life), success of exploration,
development and mining, currency fluctuations, capital
requirements, project studies, government regulation permit
applications and conversions, restarting suspended or disrupted
operations; environmental risks and proceedings; and resolution of
pending litigation. The words “anticipate”, “estimate”, “expect”,
“growth projects”, “on track”, “opportunity”, “outlook”, “plan”,
“promising”, “prospect”, or variations of or similar such words and
phrases or statements that certain actions, events or results may,
could, should or will be achieved, received or taken, or will occur
or result and similar such expressions identify forward-looking
statements. Forward-looking statements are necessarily based upon a
number of estimates and assumptions that, while considered
reasonable by Kinross as of the date of such statements, are
inherently subject to significant business, economic and
competitive uncertainties and contingencies. The estimates, models
and assumptions of Kinross referenced, contained or incorporated by
reference in this news release, which may prove to be incorrect,
include, but are not limited to, the various assumptions set forth
herein and in our MD&A for the year ended December 31, 2019,
and the Annual Information Form dated March 30, 2020 as well as:
(1) there being no significant disruptions affecting the operations
of the Company, whether due to extreme weather events (including,
without limitation, excessive or lack of rainfall, in particular,
the potential for further production curtailments at Paracatu
resulting from insufficient rainfall and the operational challenges
at Fort Knox and Bald Mountain resulting from excessive rainfall,
which can impact costs and/or production) and other or related
natural disasters, labour disruptions (including but not limited to
strikes or workforce reductions), supply disruptions, power
disruptions, damage to equipment, pit wall slides (in particular
that the effects of the pit wall slides at Fort Knox and Round
Mountain are consistent with the Company’s expectations) or
otherwise; (2) permitting, development, operations and production
from the Company’s operations and development projects being
consistent with Kinross’ current expectations including, without
limitation: the maintenance of existing permits and approvals and
the timely receipt of all permits and authorizations necessary for
the operation of the Tasiast Phase One expansion, and the
development and operation of the 24k Project; operation of the SAG
mill at Tasiast; land acquisitions and permitting for the
construction and operation of the new tailings facility, water and
power supply and continued operation of the tailings reprocessing
facility at Paracatu; the Lobo-Marte project; commencement of
production at the La Coipa project; approval of an enhanced mine
plan at Fort Knox; in each case in a manner consistent with the
Company’s expectations; and the successful completion of
exploration consistent with the Company’s expectations at the
Company’s projects, including Kupol and Chirano; (3) political and
legal developments in any jurisdiction in which the Company
operates being consistent with its current expectations including,
without limitation, the impact of any political tensions and
uncertainty in the Russian Federation or any related sanctions and
any other similar restrictions or penalties imposed, or actions
taken, by any government, including but not limited to amendments
to the mining laws, and potential power rationing and tailings
facility regulations in Brazil, potential amendments to water laws
and/or other water use restrictions and regulatory actions in
Chile, new dam safety regulations, and potential amendments to
minerals and mining laws and energy levies laws, and the
enforcement of labour laws in Ghana, new regulations relating to
work permits, potential amendments to customs and mining laws
(including but not limited to amendments to the VAT) and the
potential application of revisions to the tax code in Mauritania,
the European Union’s General Data Protection Regulation or similar
legislation in other jurisdictions and potential amendments to and
enforcement of tax laws in Russia (including, but not limited to,
the interpretation, implementation, application and enforcement of
any such laws and amendments thereto), and the impact of any trade
tariffs being consistent with Kinross’ current expectations; (4)
the completion of studies, including optimization studies,
improvement studies; scoping studies and pre-feasibility and
feasibility studies, on the timelines currently expected and the
results of those studies being consistent with Kinross’ current
expectations, including the completion of the Lobo-Marte and Peak
feasibility studies; (5) the exchange rate between the Canadian
dollar, Brazilian real, Chilean peso, Russian rouble, Mauritanian
ouguiya, Ghanaian cedi and the U.S. dollar being approximately
consistent with current levels; (6) certain price assumptions for
gold and silver; (7) prices for diesel, natural gas, fuel oil,
electricity and other key supplies being approximately consistent
with the Company’s expectations; (8) production and cost of sales
forecasts for the Company meeting expectations; (9) the accuracy
of: the current mineral reserve and mineral resource estimates of
the Company including the accuracy and reliability of the
pre-acquisition mineral resource estimates of the Peak project and
Kinross’ analysis thereof being consistent with expectations
(including but not limited to ore tonnage and ore grade estimates),
future mineral resource and mineral reserve estimates being
consistent with preliminary work undertaken by the Company, mine
plans for the Company’s current and future mining operations, and
the Company’s internal models; (10) labour and materials costs
increasing on a basis consistent with Kinross’ current
expectations; (11) the terms and conditions of the legal and fiscal
stability agreements for the Tasiast and Chirano operations being
interpreted and applied in a manner consistent with their intent
and Kinross’ expectations and without material amendment or formal
dispute (including without limitation the application of tax,
customs and duties exemptions and royalties); (12) goodwill and/or
asset impairment potential; (13) the regulatory and legislative
regime regarding mining, electricity production and transmission
(including rules related to power tariffs) in Brazil being
consistent with Kinross’ current expectations; (14) access to
capital markets, including but not limited to maintaining our
current credit ratings consistent with the Company’s current
expectations; (15) that the Brazilian power plants will operate in
a manner consistent with our expectations; (16) that drawdown of
remaining funds under the Tasiast project financing will proceed in
a manner consistent with our current expectations; (17) potential
direct or indirect operational impacts resulting from infectious
diseases or pandemics such as the ongoing COVID-19 pandemic; (18)
the effectiveness of preventative actions and contingency plans put
in place by the Company to respond to the COVID-19 pandemic,
including, but not limited to, social distancing, a non-essential
travel ban, business continuity plans, and efforts to mitigate
supply chain disruptions; (19) changes in national and local
government legislation or other government actions, particularly in
response to the COVID-19 outbreak; (20) litigation, regulatory
proceedings and audits, and the potential ramifications thereof,
being concluded in a manner consistent with the Corporation’s
expectations (including without limitation the ongoing
industry-wide audit of mining companies in Ghana which includes the
Corporation’s Ghanaian subsidiaries, litigation in Chile relating
to the alleged damage of wetlands and the scope of any remediation
plan or other environmental obligations arising therefrom, the
ongoing litigation with the Russian tax authorities regarding
dividend withholding tax and the ongoing Sunnyside litigation
regarding potential liability under the U.S. Comprehensive
Environmental Response, Compensation, and Liability Act); (21) that
the Company will enter into definitive documentation with the
Government of Mauritania in accordance with, and on the timeline
contemplated by, the terms and conditions of the term sheet, on a
basis consistent with our expectations and that the parties will
perform their respective obligations thereunder on the timelines
agreed; (22) that the exploitation permit for Tasiast Sud will be
issued on timelines consistent with our expectations; (23) that the
benefits of the contemplated arrangements related to the agreement
in principle will result in increased stability at the Company’s
operations in Mauritania; and (24) the Company’s financial results,
cash flows and future prospects being consistent with Company
expectations in amounts sufficient to permit sustained dividend
payments. Known and unknown factors could cause actual results to
differ materially from those projected in the forward-looking
statements. Such factors include, but are not limited to: the
inaccuracy of any of the foregoing assumption, sanctions (any other
similar restrictions or penalties) now or subsequently imposed,
other actions taken, by, against, in respect of or otherwise
impacting any jurisdiction in which the Company is domiciled or
operates (including but not limited to the Russian Federation,
Canada, the European Union and the United States), or any
government or citizens of, persons or companies domiciled in, or
the Company’s business, operations or other activities in, any such
jurisdiction; reductions in the ability of the Company to transport
and refine doré; fluctuations in the currency markets; fluctuations
in the spot and forward price of gold or certain other commodities
(such as fuel and electricity); changes in the discount rates
applied to calculate the present value of net future cash flows
based on country-specific real weighted average cost of capital;
changes in the market valuations of peer group gold producers and
the Company, and the resulting impact on market price to net asset
value multiples; changes in various market variables, such as
interest rates, foreign exchange rates, gold or silver prices and
lease rates, or global fuel prices, that could impact the
mark-to-market value of outstanding derivative instruments and
ongoing payments/receipts under any financial obligations; risks
arising from holding derivative instruments (such as credit risk,
market liquidity risk and mark-to-market risk); changes in national
and local government legislation, taxation (including but not
limited to income tax, advance income tax, stamp tax, withholding
tax, capital tax, tariffs, value-added or sales tax, capital
outflow tax, capital gains tax, windfall or windfall profits tax,
production royalties, excise tax, customs/import or export
taxes/duties, asset taxes, asset transfer tax, property use or
other real estate tax, together with any related fine, penalty,
surcharge, or interest imposed in connection with such taxes),
controls, policies and regulations; the security of personnel and
assets; political or economic developments in Canada, the United
States, Chile, Brazil, Russia, Mauritania, Ghana, or other
countries in which Kinross does business or may carry on business;
business opportunities that may be presented to, or pursued by, us;
our ability to successfully integrate acquisitions and complete
divestitures; operating or technical difficulties in connection
with mining or development activities; employee relations;
litigation or other claims against, or regulatory investigations
and/or any enforcement actions, administrative orders or sanctions
in respect of the Company (and/or its directors, officers, or
employees) including, but not limited to, securities class action
litigation in Canada and/or the United States, environmental
litigation or regulatory proceedings or any investigations,
enforcement actions and/or sanctions under any applicable
anti-corruption, international sanctions and/or anti-money
laundering laws and regulations in Canada, the United States or any
other applicable jurisdiction; the speculative nature of gold
exploration and development including, but not limited to, the
risks of obtaining necessary licenses and permits; diminishing
quantities or grades of reserves; adverse changes in our credit
ratings; and contests over title to properties, particularly title
to undeveloped properties. In addition, there are risks and hazards
associated with the business of gold exploration, development and
mining, including environmental hazards, industrial accidents,
unusual or unexpected formations, pressures, cave-ins, flooding and
gold bullion losses (and the risk of inadequate insurance, or the
inability to obtain insurance, to cover these risks). Many of these
uncertainties and contingencies can directly or indirectly affect,
and could cause, Kinross’ actual results to differ materially from
those expressed or implied in any forward-looking statements made
by, or on behalf of, Kinross, including but not limited to
resulting in an impairment charge on goodwill and/or assets. There
can be no assurance that forward-looking statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements.
Forward-looking statements are provided for the purpose of
providing information about management’s expectations and plans
relating to the future. All of the forward-looking statements made
in this news release are qualified by this cautionary statement and
those made in our other filings with the securities regulators of
Canada and the United States including, but not limited to, the
cautionary statements made in the “Risk Analysis” section of our
MD&A for the year ended December 31, 2019 and the Annual
Information Form dated March 30, 2020. These factors are not
intended to represent a complete list of the factors that could
affect Kinross. Kinross disclaims any intention or obligation to
update or revise any forward-looking statements or to explain any
material difference between subsequent actual events and such
forward-looking statements, except to the extent required by
applicable law.
Other information
Where we say "we", "us", "our", the "Company",
or "Kinross" in this presentation, we mean Kinross Gold Corporation
and/or one or more or all of its subsidiaries, as may be
applicable.
The technical information about the Company’s
mineral properties contained in this presentation has been prepared
under the supervision of Mr. John Sims, an officer of the Company
who is a “qualified person” within the meaning of National
Instrument 43-101.
Source: Kinross Gold Corporation
1 Production figures are based on Kinross’ 90% share of
Chirano and 70% of Peak production.
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