Kinross Gold Corporation · TSX:K
Kinross Gold — NYSE Basic Materials Investor Access Day 2020
66 slides from Kinross Gold's conference presentation, June 2020
Slide 1: Delivering Value.
June 2020 Delivering Value. Kinross Gold Corporation
Slide 2: Cautionary Statement on Forward-Looking Information
June 2020 Cautionary Statement on Forward-Looking Information All statements, other than statements of historical fact, contained or incorporated by reference in or made in giving this presentation and responses to questions, including but not limited to any information as to the future performance
Slide 3: Kinross Value Proposition
Kinross Value Proposition Operational Excellence Financial Strength & Flexibility Diverse portfolio of mines consistently meeting Maintaining a strong balance sheet continues to or outperforming operational targets be a priority objective Available liquidity of ~$1.9 billion, 8 Consecutive Met or ex
Slide 4: COVID-19 Response
COVID-19 Response
Slide 5: First Quarter Impact
COVID-19 Response June 2020 First Quarter Impact Round Bald Kupol/ Fort Knox Paracatu Tasiast Chirano Mountain Mountain Dvoinoye Mine Operating Gold Sales/ Shipments Adequate Supply Level No material disruption No material disruption, but workarounds employed 5
Slide 6: Global Response
COVID-19 Response June 2020 Global Response Kinross has implemented new protocols across our operations to prevent and mitigate risk associated with COVID-19 Risk Mitigation Plan Implemented Maintaining high standard of health and safety, our first priority Reviewed all key consumables and criti
Slide 7: Community Impact
COVID-19 Response June 2020 Community Impact Community health and safety is a key priority. Kinross has been working with local communities to help them deal with the impacts of COVID-19. • Kinross has committed $5.3 million in support of local COVID-19 response efforts • In Mauritania, we’ve equipp
Slide 8: Corporate Responsibility
Corporate Responsibility We operate according to the highest standards of corporate governance, ethics and honesty, and respect human rights and the environment wherever we work. 8
Slide 9: Our Approach
Corporate Responsibility June 2020 Our Approach At the heart of our success is our people and our four Core Values Our Values and Guiding Principles unite our global workforce Our approach to Corporate Responsibility can be distilled into four main areas: • Do no harm – We work to protect our workfo
Slide 10: Health & Safety Highlights
Corporate Responsibility June 2020 Health & Safety Highlights Our strong track record of operational excellence goes hand-in-hand with best-in-class performance in health and safety • Total Reportable Injury Frequency Rate (TRIFR) of 0.27 is: Five-Year Safety Performance TRIFR1 Among the lowest of
Slide 11: Managing our Environmental Footprint
Corporate Responsibility June 2020 Managing our Environmental Footprint We are a responsible steward of land and water during all stages of the mine’s life cycle Performance Highlights 2018-2019 Highlights • Received the top ranking from World Wildlife • Among the lowest GHG Fund Russia’s Environmen
Slide 12: Responsible & Safe Tailings Management
Corporate Responsibility June 2020 Responsible & Safe Tailings Management All of our tailings facilities are designed and constructed to the highest engineering standards and meet or exceed regulatory and international requirements and standards of best practice • Tailings management programs incorp
Slide 13: Measuring Social Outcomes of Our Operations
Corporate Responsibility June 2020 Measuring Social Outcomes of Our Operations Kinross is one of the few mining companies that measures the social outcomes of our operations Studies at Tasiast show significant reductions in poverty levels Data show that Paracatu has advanced more and improved qualit
Slide 14: Governance Highlights
Corporate Responsibility June 2020 Governance Highlights Kinross is committed to the highest standards of corporate governance and accountability • 8 of 9 Board members are • All directors are independent independent except for the Chief Executive • All of our board committees are Officer composed o
Slide 15: Operational Excellence
Operational Excellence We remain focused on operational excellence, building a culture of continuous improvement, innovation and disciplined cost management
Slide 16: Diversified Portfolio of Assets
Operational Excellence June 2020 Diversified Portfolio of Assets ~56% of 2019 gold equivalent production from mines located in the Americas Dvoinoye, Russia Kupol, Fort Knox, USA Russia Chulbatkan, Russia Bald Mountain, USA Round Mountain, USA Tasiast, Mauritania 2019 Gold Equivalent Production(1) C
Slide 17: Eight Consecutive Years of Meeting Guidance
Operational Excellence June 2020 Eight Consecutive Years of Meeting Guidance Kinross has met or exceeded guidance targets for production, costs and capital expenditures for the past eight years 2012 2013 2014 2015 2016 2017 2018 2019 Met or exceeded annual production guidance Met or
Slide 18: First Quarter 2020 Operational Highlights
Operational Excellence June 2020 First Quarter 2020 Operational Highlights Three largest producing mines – Paracatu, Kupol-Dvoinoye and Tasiast – delivered 62% of first quarter production at average cost of sales of $642/oz(1,3) Operation Q1 Performance(1,3) Highlights Paracatu, Brazil Production •
Slide 19: Increased Life of Mine Production at Paracatu
Operational Excellence June 2020 Increased Life of Mine Production at Paracatu New technical report highlights benefits of the optimization project • Largest producer in the portfolio • Cash costs lower quarter-over-quarter due to cost-reduction strategy, improved productivity and favourable foreign
Slide 20: Consistent Performance from Kupol-Dvoinoye
Operational Excellence June 2020 Consistent Performance from Kupol-Dvoinoye Kupol-Dvoinoye delivered consistent results within our original expectations • Highest cash-flowing asset in the quarter • Second-largest producer in the portfolio • Production impacted by lower grades o Expected to return t
Slide 21: Record Performance at Tasiast
Operational Excellence June 2020 Record Performance at Tasiast Record production and throughput in Q1 as the 24k Project advances • Second consecutive quarter of record production and throughput Tasiast quarterly performance 120 $700 • Lowest-cost producer in the portfolio Production cost of sales (
Slide 22: Financial Strength & Flexibility
Financial Strength & Flexibility Maintaining balance sheet strength & financial flexibility remain priority objectives
Slide 23: First Quarter Financial Highlights
Financial Strength & Flexibility June 2020 First Quarter Financial Highlights Produced approximately 567,000 attributable gold equivalent ounces, at an average cost of sales of $754/oz(1,3) and an all-in sustaining cost of $993/oz(1,3) Year-over-year improvements First quarter performance 81% Adjust
Slide 24: Strong Liquidity Position
Financial Strength & Flexibility June 2020 Strong Liquidity Position Strong financial position to fund operations and development projects Financial Flexibility Liquidity Position ($ billion) • Net debt to EBITDA remains strong at 0.9x • Moody’s upgraded credit rating to investment grade As at March
Slide 25: Manageable Debt Profile
Financial Strength & Flexibility June 2020 Manageable Debt Profile Kinross’ senior notes are rated investment grade with the next repayment due in September 2021 Debt Schedule Debt Ratings $32 Agency Rating $750 S&P BBB- (Stable) Moody’s Baa3 (Stable) Fitch BBB- (Stable) $ millions $72 Interest Rate
Slide 26: Tasiast Project Financing
Financial Strength & Flexibility June 2020 Tasiast Project Financing Reflects comprehensive process of due diligence with lenders • Signed $300 million IFC-led project financing agreement in December 2019 o Non-recourse to Kinross o Four new, important partners in Tasiast Project Financing Details p
Slide 27: Development Projects & Exploration Highlights
Development Projects & Exploration Highlights We have a portfolio of development projects that we are progressing, and we are also focused on advancing a pipeline of future opportunities and high potential exploration targets
Slide 28: Tasiast 24k Project Feasibility Study Results
Development Projects June 2020 Tasiast 24k Project Feasibility Study Results Proceeding with value-enhancing Tasiast 24k project, which offers attractive estimated returns, increased production and lower costs Operating Estimates Throughput capacity 24,000 t/d Average annual production (2022 – 2028)
Slide 29: Low-Capital Continuous Improvement Approach
Development Projects June 2020 Low-Capital Continuous Improvement Approach Increase to throughput with debottlenecking initiatives, plant upgrades and optimization of the mine plan and processing circuit Building off success of Phase One and Project Overview continued outperformance of the SAG mill
Slide 30: Advancing the Tasiast 24k Project
Development Projects June 2020 Advancing the Tasiast 24k Project Well-positioned to execute the 24k project Low relative execution risk • Project plan leverages Kinross’ experience successfully building and operating Phase One • Less infrastructure requirements • Permits in place for the 24k project
Slide 31: Successful Track Record in Mauritania
Development Projects June 2020 Successful Track Record in Mauritania Successfully operated in Mauritania for over 10 years Cumulative production of over 2 million gold equivalent ounces Established $300M political risk insurance policy with MIGA, a member of the World Bank Constructed Phase One
Slide 32: Strong Platform in Russia
Exploration Highlights June 2020 Strong Platform in Russia Track record of adding reserves through exploration to offset depletion at Kupol supports a potential bridge to production at Chulbatkan 12.0 2024 Gold Equivalent Ounces 2023 10.0 2022 End of Mine Life 8.0 2021 (Millions) 2020 6.0 2019 4.0 2
Slide 33: Evaluating Potential at Chulbatkan
Development Projects June 2020 Evaluating Potential at Chulbatkan High-quality project with strong base case and significant upside potential • Near-surface, heap-leachable deposit; initial resource estimate of approximately 4 million oz.(6) • Highly continuous mineralization that is open along stri
Slide 34: Chulbatkan Project Location
Development Projects June 2020 Chulbatkan Project Location Khabarovsk is industrialized and has a well-established mining and exploration sector Mining-friendly jurisdiction Kupol Magadan • Several gold producers active in the region Khabarovsk Ten operating mines Fourth largest gold producing r
Slide 35: Chulbatkan: Strong Base Case with Upside Potential
Development Projects June 2020 Chulbatkan: Strong Base Case with Upside Potential Expected to be a substantial open pit gold mine with a low all-in sustaining cost(3) • Preliminary estimates; scope of project may change following planned extensive drill program and technical studies and trade-offs E
Slide 36: Significant Upside Opportunities at Chulbatkan
Development Projects June 2020 Significant Upside Opportunities at Chulbatkan Kinross plans to undertake a robust exploration program with a focus of defining and further extending the resource • Confirmatory drill program(5) encountered a potential • Drill planning and execution to grow high-grade
Slide 37: Chulbatkan Regional Exploration Upside
Development Projects June 2020 Chulbatkan Regional Exploration Upside Numerous untested potential targets within the ~120km2 exploration license • Multiple structural environments analogous to Chulbatkan deposit • Multiple downstream placer gold occurrences indicate hard rock sources within license
Slide 38: Fort Knox Gilmore
Development Projects June 2020 Fort Knox Gilmore Gilmore project expected to extend mine life to 2030 and strengthen long-term U.S. production profile 38
Slide 39: Gilmore Feasibility Study Results
Development Projects June 2020 Gilmore Feasibility Study Results Project expected to generate a 17% IRR at an assumed gold price of $1,200/oz Current mine plan + Gilmore estimates Average annual production (2018-2027) 245,000 gold ounces Production cost of sales(3) (2018-2027) $735 per gold equivale
Slide 40: Fort Knox Gilmore
Development Projects June 2020 Fort Knox Gilmore Encountered initial ore in Q4 2019, ahead of original plan • Project advancing on budget and on schedule • Stripping commenced in Q3 2019 and is expected to continue through 2020 • All procurement complete for work planned for 2020; all critical mater
Slide 41: La Coipa Restart Project
Development Projects June 2020 La Coipa Restart Project Work commenced in Q1; transfer of mine fleet from Maricunga now complete • Leverages existing infrastructure, including plant and Maricunga mine fleet • Potential to extend mine life through satellite deposits • Due to limitations placed on peo
Slide 42: La Coipa Restart Feasibility Study Results
Development Projects June 2020 La Coipa Restart Feasibility Study Results Project expected to generate a 28% IRR at an assumed gold price of $1,200/oz Feasibility Study Estimates Life of mine production (2022 to 2024) 690,000 gold equivalent ounces Average production cost of sales(3) $575 per gold e
Slide 43: Lobo-Marte
Development Projects June 2020 Lobo-Marte Evaluating potential synergies with La Coipa and a return to long-term production in Chile N • Scoping study completed in Q1 2019 with encouraging results, including: La Coipa Restart Total estimated production: 4.1M Au oz. at 1.2 g/t project Mine life:
Slide 44: Key Mineral Reserve Additions
Exploration Highlights June 2020 Key Mineral Reserve Additions Extended mine life at two operations, a result of another successful exploration program in 2019 Paracatu Kupol-Dvoinoye Chirano Offset depletion with the Mine life extended to 2024, Mine life extended to 2022, addition of ~828,000 Au oz
Slide 45: Compelling Relative Value
Compelling Relative Value Attractive value opportunity relative to peers, considering Kinross’ annual production, cost structure, track record and growth opportunities
Slide 46: 2020E Production & All-In Sustaining Cost
Compelling Relative Value June 2020 2020E Production & All-In Sustaining Cost 2020E Production 2020E All-In Sustaining Cost (million ounces) ($ per ounce) 7.0 $1,050 6.0 5.0 $900 4.0 3.0 2.0 $750 1.0 0.0 $600 Gold Fields Gold Fields Newmont AngloGold Newcrest Kirkland Lake AngloGold Kirkland Lake Ba
Slide 47: 2020E Metrics
Compelling Relative Value June 2020 2020E Metrics Attractive value opportunity relative to peers, considering Kinross’ annual production, cost structure, track record and growth opportunities P / 2020E Operating CF EV / 2020E EBITDA 14.2 13.5 13.0 12.2 10.3 10.1 10.0 9.8 8.9 8.1 7.6 6.8 6.1 5.9 5.7
Slide 48: Continuing to Enhance Value
Compelling Relative Value June 2020 Continuing to Enhance Value Strong track record over past 8 years: Future Expectation(2): Production ~2.5 million Au eq. oz. per year ~2.5 million Au eq. oz. per year Costs and Reduced AISC by Further reduce AISC(3) and capital Capital ~$100/Au eq. oz. (1,3) expen
Slide 49: Appendix
Appendix
Slide 50: Essential Service Status
COVID-19 Response June 2020 Essential Service Status(i) Operation Location Status Government Decree Mining considered essential as part of State of Nevada regulations issued on Round Mountain Nevada, U.S.A. Operating March 20, 2020. Mining considered essential as part of State of Nevada regulations
Slide 51: Fort Knox, USA (100%)
Americas June 2020 Fort Knox, USA (100%) The Gilmore project is expected to extend mine life to 2030 • Successfully operating one of the world’s Operating Results(3) few cold weather heap leaches 2018 2019 • Estimated mine life: mill – 2020; mining – 2027; leaching – 2030 Production 255,569 200,263
Slide 52: Summary of Feasibility Study Results
Fort Knox Gilmore June 2020 Summary of Feasibility Study Results Operating Estimates (current mine plan + Gilmore) Incremental Gilmore Estimates(i) Timeline Operational Metric Estimate Estimate Average annual tonnes mined 60 million Strip ratio 1.2 Strip ratio 1.2 Life of mine ore processed 183 mill
Slide 53: Round Mountain, USA (100%)
Americas June 2020 Round Mountain, USA (100%) Strong cash flow generator with Phase W project extending mine life to 2027 • Phase W is expected to generate solid Operating Results(3) returns and extend mining 2018 2019 • Estimated mine life: 2024 (mining); 2027 (stockpile milling / residual leaching
Slide 54: Summary of Feasibility Study Results
Round Mountain Phase W June 2020 Summary of Feasibility Study Results Operating Estimates (current mine plan + Phase W) Standalone Phase W Estimates Timeline Operational Metric Estimate Estimate Strip ratio 2.9 Life of mine production 1.5 million ounces Average grade processed 0.7 grams per tonne Li
Slide 55: Bald Mountain, USA (100%)
Americas June 2020 Bald Mountain, USA (100%) Forecasting strong near-term cash flow with significant upside potential • Large estimated mineral resource base with Operating Results(3) multiple sources of potential mineral reserve 2018 2019 additions • Estimated mine life: 2023 Production 284,646 187
Slide 56: Paracatu, Brazil (100%)
Americas June 2020 Paracatu, Brazil (100%) Large gold mine with a long mine life that extends to 2031 • Paracatu is among the world’s largest gold Operating Results(3) operations with annual throughput of ~60Mt 2018 2019 • Cornerstone asset in Kinross’ portfolio Production • Estimated mine life: 203
Slide 57: Kupol-Dvoinoye (100%)
Russia June 2020 Kupol-Dvoinoye (100%) Our Russian mines are a model for successfully operating in a remote location • High-grade, low-cost underground mines Operating Results(3) supported by one mill 2018 2019 • Estimated mine life: 2024, following another Production 1-year extension in 2019 489,94
Slide 58: Deep Experience In-Country
Russia June 2020 Deep Experience In-Country Kinross has a long and successful 25-year track record investing in Russia Significant operating experience 2018 Statistics: • Operated four mines, including the high-grade, low Kinross Investments in Russia cost Kupol and Dvoinoye mines 98.5% of employees
Slide 59: Foreign Investment in Russia
Russia June 2020 Foreign Investment in Russia The world’s leading companies are Foreign Investment Advisory Council invested in Russia • Chaired by the Russian Prime Minister, includes CEOs from over 50 international companies 59
Slide 60: Tasiast, Mauritania (100%)
West Africa June 2020 Tasiast, Mauritania (100%) Low-cost mine with a large gold resource located in a prospective district • First full year operating the Phase One Operating Results(3) expansion in 2019 2018 2019 • Advancing the 24k project to further Production increase throughput (Au eq. oz.) 25
Slide 61: Feasibility Study Results: Operating Estimates
Tasiast 24k Project June 2020 Feasibility Study Results: Operating Estimates Results Highlights Life of Mine Estimates (2020-2033) Timeline Operational Metric Estimate Operational Metric Estimate Total material mined 375,900,000 Total tonnes mined 628,800,000 Strip ratio 5.9 Total ore mined (tonnes)
Slide 62: Feasibility Study Results: Capital & Economics
Tasiast 24k Project June 2020 Feasibility Study Results: Capital & Economics Estimated Initial Capital Cost Estimated Sustaining Capital • Expected to be approximately $30M per year Estimate ($ millions) Life of Mine estimate ($ millions) Support infrastructure 47 Mobile maintenance 150 Process plan
Slide 63: Chirano, Ghana (90%)
West Africa June 2020 Chirano, Ghana (90%) Exploration success adding ounces to mineral reserves • Chirano is an underground and open pit Operating Results(1,3) operation located in southwestern Ghana 2018 2019 • Estimated mine life: 2022 Production 204,029 181,167 (Au eq. oz.) Production cost of sa
Slide 64: Chirano Exploration Highlights
West Africa June 2020 Chirano Exploration Highlights Production at Chirano is expected to extend to 2022, another 1-year extension • 2019 exploration focus continued to be on adding incremental ounces to mine life Focused on confirming the depth extensions at Akwaaba, Paboase and Tano, and testing
Slide 65: Endnotes
Appendix June 2020 Endnotes 1) Unless otherwise noted, gold equivalent production, gold equivalent ounces sold and production cost of sales figures in this presentation are based on Kinross’ 90% share of Chirano production and sales. Also unless otherwise noted, dollar per ounce ($/oz.) figures in t
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Kinross Gold — NYSE Basic Materials Investor Access Day 2020 on 6ix