Kinross consolidating 100% of Kupol project, to pay $350 mln
MOSCOW. April 5 (Interfax) - Kinross Gold Corporation subsidiary Kupol Ventures Ltd is buying the outstanding 25% of OJSC Chukotka Mining and Geology Company, which holds the license to the big Kupol gold and silver field, for $350 million, Kinross said in a statement.
The government's foreign investment oversight commission recently approved an application to buy the 25%.
The fully consolidated company will account for around 17% of the Canadian company's mine output.
The Canadian gold major said in a 2010 earnings report released that the mine reduced overall output 20% in 2010 to 738,397 oz (23 tonnes) gold equivalent due to an anticipated decrease in the ore grading.
Kinross said its attributable output at Kupol would be 435,000-455,000 oz gold equivalent this year, equating to overall output of 580,000-607,000 oz at average cash cost of $395-$435/oz.
Planned capex in Russia this year is $155 million, of which $30 million will be invested at the Kupol site and $110 million in new projects - Kinross is also developing several sites close to Kupol.
The Chukotka regional administration has said Kupol produced 19.6 tonnes (630,164 oz) gold and 207.5 tonnes silver in 2010.