27 Jul 2010 13:25

Kinross buying rights to acquire Kupol deposit flanks from B2Gold

MOSCOW. July 27 (Interfax) - Kinross Gold of Canada, which works the major Kupol gold deposit in Chukotka, has struck an agreement with B2Gold to buy the deposit's western and eastern flanks, Kinross announced.

B2Gold was founded in 2007 by former Bema Gold management, the purchase of which gave Kinross the development rights to Kupol. B2Gold and the Canadian company clinched an agreement in 2007 to prospect the deposit's eastern and western flanks, in which project B2Gold could receive 37.5%.

The terms of the new agreement stipulate Kinross is no longer obliged to sell its stake to B2Gold for $33 million. The deal is expected to be completed this coming August.

The upshot of the deal is Chukotka Mining and Geological Company, which already has the rights to develop Kupol, gaining a 100% stake in the development of the eastern and western flanks. Kinross owns 75% of the company and GUP Chukotsnab the other 25%.

Kinross Gold is one of the biggest gold producers in Russia. It has yet to release its first-half report, but the company extracted 192,921 ounces of gold equivalent in the first quarter. Kinross operates at ten-plus deposits worldwide.