Kinross Gold Reserves Increase To 51 Million Ounces

 

TORONTO, ON - Kinross Gold Corporation reported that its mineral reserve and resource statements as at December 31, 2009.

Total proven and probable mineral reserves increased by 5.4 million ounces to 51.0 million ounces of gold, an increase of 12% over 2008.

The Company declared its first mineral reserve at the Lobo-Marte project in Chile as planned, with proven and probable gold reserves of 5.6 million ounces grading at 1.22 grams of gold per tonne.

Kinross upgraded mineral resources at Fruta del Norte (FDN) in Ecuador in 2009 as planned, declaring a measured and indicated gold resource of 5.7 million ounces grading at 11.2 grams of gold per tonne, plus an inferred resource of 6.1 million ounces.

"With proven and probable gold reserves increasing by 31 million ounces over the past five years, a compound annual growth rate of 21%, Kinross has now surpassed the 50 million ounce milestone," said President and CEO Tye Burt. "In 2009 we achieved our goal of declaring a first reserve at Lobo-Marte and are pleased with progress at this strategic project. We also upgraded our mineral resource at FDN and are proceeding with our 2010 drilling program. Exploration success at our growth projects during the year offset production depletion by a wide margin, delivering a net gain of over five million ounces in new reserves."

Kinross' total proven and probable mineral reserves at year-end 2009 increased by 5.4 million ounces of gold to 51.0 million ounces, versus 45.6 million ounces at year-end 2008.Ê 2009 reserves were based on a gold price of $800.??The Company has completed a pre-feasibility study at the Lobo-Marte project which confirms the viability of heap leach processing, and has subsequently declared a proven and probable mineral reserve of 5.6 million ounces, the largest single increase to reserves.

Gold reserves also increased at the Cerro Casale, in Chile, project by 1.2 million ounces due to engineering changes, project improvements, and the change in Kinross' ownership from 49% to 50%. Gold reserves at La Coipa, in Chile, increased by 0.5 million ounces due primarily to exploration additions at Coipa Norte.

Proven and probable silver reserves decreased slightly by 2.9 million ounces, or 3%, to 103 million ounces, versus 106 million ounces at year-end 2008. Proven and probable copper reserves at year-end 2009 increased by 290 million pounds to 2.9 billion pounds. Kinross' total measured and indicated (M&I) mineral resources at year-end 2009 increased by 2.9 million ounces of gold, or 21%, to 16.6 million ounces versus 13.7 million ounces at year-end 2008. 2009 resources were based on a gold price of $875.

The increase is primarily due to the upgrading of the mineral resource at the FDN development project in Ecuador, which contributed 5.7 million ounces to measured and indicated mineral resources. This resource upgrade is based on Kinross' analysis of 67,000 metres of drilling by the previous owner and positive metallurgical and mining study work showing potential for economic extraction. Kinross received approval from the Ecuadorian government in November 2009 to re-commence exploration at FDN and is continuing with an 18,000-metre drilling campaign in 2010 with the expectation of further upgrading resources. Kinross has elected to undertake this additional drilling prior to finalizing the FDN pre-feasibility study, which it expects to complete at year-end. The Company is filing a Technical Report on FDN in connection with the upgrading of its mineral resource. Ê

Kinross has completed a pre-feasibility study on the Lobo-Marte gold project in Chile based on drill hole information obtained at the time of acquisition and the metallurgical drill program completed in 2009. The pre-feasibility study confirms the viability of a 47,000 tonne per day open pit heap leach operation incorporating SART (Sulphidization, Acidification, Recycling and Thickening) technology, and identifies proven and probable mineral reserves of approximately 5.6 million ounces of gold at an average grade of 1.22 grams of gold per tonne. The average estimated grades for Lobo-Marte as a heap leach operation are lower, and tonnages are higher, than previous estimates which were based on a milling operation. The study estimates initial capital expenditures of approximately $575-650 million and operating costs of approximately $11.50-12.50 per tonne, with annual production estimated to be approximately 350,000-400,000 gold equivalent ounces for the first five years of full production. Project infrastructure would include an upgraded powerline providing 16 MW of power, and a 1,500 person camp to accommodate construction and phase into operations. Once operational, the project is expected to employ approximately 700 people, including permanent contractors.

The pre-feasibility study is based on estimated heap leach recovery rates of 60%-70%. Optimization opportunities and options that are being explored include potential recovery improvements through the addition of high pressure grinding rolls, plus potential improvements to plant layout and infrastructure.

Kinross is currently targeting first gold production at Lobo-Marte between the third quarter of 2013 and mid-2014. A more definitive timetable will be developed as part of the project feasibility study and will depend, among other things, on discussions with government authorities regarding estimated permitting timeframes and projected construction schedules.

The company’s address is 25 York Street, 17th Floor Toronto, ON M5J 2V5, 416-365-5123, fax: 416-363-6622, email: [email protected].