TORONTO, July 28 /CNW/ - Kinross Gold Corporation (TSX-K; NYSE-KGC)
("Kinross" or the "Company") announced today that gold equivalent production
for the second quarter 2005 was on plan at 413,597 gold equivalent ounces.
We are still working through our regulatory review of the accounting for
the assets acquired in the TVX/Echo Bay merger. As a result Kinross is not in
a position to deliver financial statements for the second quarter. Kinross
will continue to provide bi-weekly updates on our progress with filing the
financial statements until the matter is resolved.
<<
OPERATIONS UPDATE
GOLD EQUIVALENT PRODUCTION
% Second Quarter Year to date
Ownership 2005 2004 2005 2004
--------------------- ---------------------
Fort Knox 100% 86,426 79,007 160,379 154,987
Round Mountain 50% 100,745 99,554 196,138 194,538
Porcupine JV 49% 51,474 53,225 104,365 105,092
Kubaka 98.1% 35,975 39,121 82,136 68,380
Paracatu(1) 100% 43,252 22,096 83,861 46,436
La Coipa 50% 30,352 32,454 64,376 73,003
Crixas 50% 24,153 23,440 48,345 45,951
Musselwhite 32% 19,403 19,600 40,947 37,149
New Britannia 50% - 7,866 - 14,573
Kettle River 100% 19,869 22,362 38,635 47,709
Lupin 100% - 19,710 - 24,897
Refugio 50% 1,948 1,658 4,895 4,389
--------------------- ---------------------
413,597 420,093 824,077 817,104
--------------------- ---------------------
--------------------- ---------------------
(1) Operating information for 2004 reflect the 49% ownership interest of
Paracatu. The remaining 51% was purchased on December 31, 2004.
The Refugio mine in Chile is now operating at name-plate capacity of
40,000 tonnes per day and this is being placed on the heap leach pads. Gold
production from crushed ore on the pads will commence shortly as the leach
process proceeds.
At Paracatu, Kinross has completed over 30,000 meters of core drilling,
and additional drilling both in the pit and on step out targets will be
completed in the second half of this year. Assay results for 60% of the holes
completed to date have been returned. We are encouraged by the drill results
we are achieving at Paracatu, and have expanded the original budget in order
to investigate new targets there.
At Round Mountain, we have completed the drill program to delineate the
potential pit expansion. A proposal to expand the pit will be made to the
partners at the next joint venture meeting. We will be spending over $13
million on expensed exploration, primarily on developing an underground drill
program below the Round Mountain pit.
Cash balances are approximately $58 million and available credit on our
revolving facility is approximately $47 million. Total cash costs for the full
year 2005 are expected to be in a range of $260 to $270 per ounce. This
represents an increase over our previous guidance with the change due
primarily to higher than budgeted energy costs and changes in foreign exchange
rates, most notably the strength of the Brazilian Real.
Capital Expenditures
To June 30, the status of major capital programs for the company, which
are expected to be funded through cash flow from operations, are as follows:
YTD Forecast
June 30, Full Year
2005 2005 Description
-----------------------------------------------------------
Fort Knox 22.3 45.0 Phase VI development
Refugio 21.5 29.5 Final re-start capital
Porcupine JV 14.1 22.5 Hoyle Pond Winze, underground
development, Pamour development
Paracatu 10.4 37.0 Ball mill refurbishment, expansion
engineering
Other 10.2 37.9
-----------------------------------------------------------
Total 78.5 171.9
-----------------------------------------------------------
"This was a solid, business-as-usual quarter for Kinross and we had
strong performances from our core operations. Cash costs are under pressure
across the industry and we are no exception", said Tye Burt, President and
CEO. "Refugio is now on-line and is a welcome contributor going forward."
Conference Call Details
Kinross will host a conference call on Friday, July 29, 2005 at
11:00 am EST to discuss the second quarter press release.
To access the call, please dial:
Toronto and internationally - (416) 640-4127
Toll free in North America - 1-800-814-4857
Replay: (available July 29 - Aug 14, 2005) Passcode - 21130892 followed
by the number sign
Toronto and internationally - (416) 640-1917
Toll free in North America - 1-877-289-8525
The conference call will be available on a listen-only basis and will
also be archived at www.kinross.com.
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This press release includes certain "Forward-Looking Statements" within
the meaning of section 21E of the United States Securities Exchange Act of
1934, as amended. All statements, other than statements of historical fact,
included herein, including without limitation, statements regarding Kinross'
financial statements for its fiscal year ended December 31, 2003, potential
mineralization and reserves, exploration results and future plans and
objectives of Kinross Gold Corporation, are forward-looking statements that
involve various risks and uncertainties. There can be no assurance that such
statements will prove to be accurate and actual results and future events
could differ materially from those anticipated in such statements. Any
restatement of historical financial statements is dependant on the outcome of
the independent valuation of the acquired assets, and Kinross does not know
what that outcome will be. Other important factors that could cause actual
results to differ materially from Kinross' expectations are disclosed under
the heading "Risk Factors" and elsewhere in Kinross' documents filed from time
to time with the Canadian Securities Regulators, the United States Securities
and Exchange Commission and other regulatory authorities.
All dollar amounts are expressed in US dollars unless otherwise noted.
Technical information contained in this press release has been reviewed
by Rod Cooper, Vice President, Technical Services for Kinross, who is a
"Qualified Person" under National Instrument 43-101.
Total cash costs are a non-GAAP measure intended to provide investors
with information about the operating efficiency of current mining operations.
Management uses this measure for the same purpose and for monitoring
performance of its gold mining operations. Total cash costs per ounce is a
standard gold mining industry measure that was developed in conjunction with
the Gold Institute in an effort to provide a level of comparability among
precious metals producers. This measure differs from earnings determined in
accordance with Generally Accepted Accounting Principles ("GAAP") and should
not be considered in isolation or a substitute for measures of performance
determined in accordance with GAAP. Total cash costs may reflect adjustments
for items that are recurring such as change in inventory and site restoration
cost accruals. A reconciliation of total cash costs with operating costs per
the consolidated financial statements will be published by the Company once
its December 31, 2004 year end financial statements are available.
Production Summary Table
As At: June 30, 2005
100% Basis
-----------------------------------------
Ore Ore
Mine Interest Year mined processed Grade Recovery
------------------------------- -----------------------------------------
(000 (000
tonnes) tonnes) (g/t) (%)
North America
-------------------------------------------------------------------------
Fort Knox 100% 2005 YTD 9,711 6,320 0.91 86.8%
2004 10,927 13,239 0.94 84.2%
Round
Mountain 50% 2005 YTD 15,605 33,388 0.72 66.0%
2004 35,820 67,065 0.65 66.0%
Porcupine 49% 2005 YTD 2,168 2,168 3.13 93.0%
2004 13,752 3,995 3.35 91.8%
Musselwhite 32% 2005 YTD 913 714 5.80 95.4%
2004 2,340 1,459 5.30 95.8%
Kettle
River 100% 2005 YTD 152 152 9.10 87.4%
2004 318 341 9.80 89.7%
South America
-------------------------------------------------------------------------
Paracatu 100%(x) 2005 YTD 8,199 7,890 0.4 77.0%
49% 2004 17,281 17,342 0.4 76.8%
La Coipa 50% 2005 YTD 1,025 3,288 1.0 80.6%
2004 3,769 6,562 1.1 81.2%
Crixas 50% 2005 YTD 375 375 8.4 95.5%
2004 746 746 8.2 95.4%
Refugio 50% 2005 YTD 1,260 569
Other
-------------------------------------------------------------------------
Kubaka 98.1% 2005 YTD 325 431 6.1 97.6%
2004 178 778 5.1 97.2%
Other Locations
-------------------------------------------------------------------------
Totals 2005 YTD
2004
-------------------------------------------------------------------------
Reserve and Resource
Kinross' share Summary(1) (K share)
-------------- --------------------------
Gold equiv. Proven & Measured &
Mine Interest Year production Probable Indicated
------------------------------- -------------- --------------------------
(ounces) (000 (000
ounces) ounces)
North America
-------------------------------------------------------------------------
Fort Knox 100% 2005 YTD 160,379
2004 338,334 2,858 842
Round
Mountain 50% 2005 YTD 196,138
2004 387,785 1,475 620
Porcupine 49% 2005 YTD 104,365
2004 193,799 1,685 1,668
Musselwhite 32% 2005 YTD 40,947
2004 76,640 607 152
Kettle
River 100% 2005 YTD 38,635
2004 96,789 54 -
South America
-------------------------------------------------------------------------
Paracatu 100%(x) 2005 YTD 83,861
49% 2004 92,356 8,463 22
La Coipa 50% 2005 YTD 64,376
2004 150,887 506 442
Crixas 50% 2005 YTD 48,345
2004 93,540 432 110
Refugio 50% 2005 YTD 4,895 1,717 797
Other
-------------------------------------------------------------------------
Kubaka 98.1% 2005 YTD 82,136
2004 123,616 258 12
Other Locations 1,356 3,522
-------------------------------------------------------------------------
Totals 2005 YTD 824,077
2004 1,653,784 19,411 8,187
-------------------------------------------------------------------------
(x) Kinross increased it's ownership in Paracatu to 100% on December 31,
2004.
>>
%SEDAR: 00002968E
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