Kinross To Produce Over 2.1 Million Gold Ounces In 2023

TORONTO - J. Paul Rollinson, President and CEO of Kinross Gold Corporation, said, “Reflecting on 2022, it was a challenging year with significant change. I am proud of our global team who came together to address the challenges we faced and am pleased to note that we finished each quarter stronger than the last. As we have exited from Russia and Ghana, and are developing our Great Bear project in Red Lake, Ontario, our portfolio is now more weighted in the Americas. We are excited about the Great Bear initial mineral resource estimate, which we announced earlier this week. We believe we have a world-class development project at Great Bear and two cornerstone production assets, Tasiast and Paracatu, that together produce over 50 per cent of our gold. We introduced an enhanced share buyback program which, along with our quarterly dividend, saw us return $455 million to shareholders in 2022, which represented about 8 per cent of our market cap. We expect to continue with our dividend and dynamic buyback program in 2023 and 2024.

The Company takes pride in being a consistent leader in ESG performance and expect to publish our 2022 Sustainability Report in May. We strengthened Board oversight of ESG and advanced strategy, awareness and programming across the Company, focusing on achieving our targets and metrics to maintain our strong performance. Were awarded the Alaska Miners Association Environmental Stewardship Award for our Abandoned Mine Restoration initiative. Advanced our commitment to diversity, equity and inclusion by working to embed inclusive behaviors into everyday interactions across the Company. Made more than $10 million of monetary and in-kind contributions through site investments, and provided humanitarian support in Mauritania to help the country manage the impact of extreme weather events. Advanced our green energy targets with the construction of the Tasiast solar plant, which is expected to come online in the second half of 2023.”

Results from the Company's Russian and Ghanaian assets have been excluded from its 2022 continuing results, along with 2021 comparative figures, due to the classification of these assets as discontinued as at December 31, 2022.

Over the full year, Kinross produced 1,957,237 Au eq. oz. from continuing operations, largely in line with the Company’s revised production guidance, compared with full-year 2021 production of 1,447,240 Au eq. oz. from continuing operations. The 35% year-over-year increase was largely a result of higher production at Tasiast due to the temporary suspension of milling operations in the prior year, and production at La Coipa due to the restart and ramp-up in the current year.

Tasiast achieved record production and record grades during the quarter. Cost of sales per ounce sold was lower quarter-over-quarter mainly due to the increase in production and higher year-over-year mainly due to higher operating waste mined. Full-year production was higher due to the temporary suspension of milling operations in the prior year. During the quarter, the Company successfully finalized a three-year collective labour agreement at Tasiast with no interruption to operations.

Paracatu continued to perform well and achieved its second highest production quarter on record, driven by high grades and strong recoveries. Production for the full-year 2022 increased compared with the previous year largely due to higher grades and recoveries. Full-year cost of sales per ounce sold increased largely due to inflationary pressures, partially offset by increased ounces sold. Cost of sales per ounce sold decreased quarter-over-quarter due to higher production.

Fort Knox full-year production increased year-over-year largely due to increased mill throughput and ounces recovered from the heap leach pads, as production from the Barnes Creek heap leach pad ramped up. Full-year cost of sales per ounce sold increased primarily due to inflationary cost pressures on consumables and higher contractor costs related to mining the Gil deposit. Q4 2022 was the strongest production quarter of the year at Fort Knox largely due to more ounces recovered from the Barnes Creek heap leach pad, partially offset by marginally lower mill grades and recovery. Lower quarter-over-quarter unit costs are mainly due to the increase in production.

At Bald Mountain, full-year production increased compared to 2021 due to an increase in ounces recovered from the heap leach pads. For the full year, cost of sales per ounce increased year-over-year largely due to inflationary cost pressures on consumables, partially offset by the increase in ounces sold. Production in Q4 2022 decreased quarter-over-quarter mainly due to fewer ounces recovered from the heap leach. Quarter-over-quarter unit costs were lower primarily due to an increase in ounces sold.

At Round Mountain, full-year production was lower year-over-year, primarily due to the timing of ounces recovered from the heap leach pads. Cost of sales per ounce sold was higher for the full year mainly due to lower production, fewer lower-cost ounces recovered from the heap leach pads, and inflationary cost pressures on consumables, cyanide in particular. Production and cost of sales per ounce sold were in line quarter-over-quarter.

The Company completed the Round Mountain Optimization program in the third quarter and decided to prioritize underground opportunities at Phase X and Gold Hill as they show potential for higher-margin, higher-return operations as compared to the open pit expansions at Phase W3 and Phase S. The Company plans to start construction of an underground exploration decline at Phase X in the first half of 2023. The Company is continuing to mine Phase W (W1 and W2) while progressing underground opportunities. The open pit expansion opportunities at Phase W3 and Phase S remain in reserves and will continue to be optimized and evaluated for potential exploitation with sustained macroeconomic improvements.

La Coipa poured its first gold in February 2022 and fourth quarter production showed significant quarter-over-quarter improvement as Q4 throughput ramped up and as mining and processing grades increased. Fourth quarter gold production has ramped up and exceeded quarterly forecast levels for 2023. La Coipa has a planned mill shutdown in February for maintenance work aimed at increasing reliability to sustain throughput. Cost of sales per ounce sold was higher quarter-over-quarter largely due to higher processing costs related to maintenance and contractors.

The Tasiast 24k project continues to progress on schedule to reach throughput of 24,000 t/d by mid-year and ramp-up to operate consistently at design tonnage by the end of the year. The final expansion to the leach circuit is now complete and has successfully been put into operation. The plant is currently undergoing a planned shutdown to allow for the installation of tie ins as part of the work for the 24k project. Civil works are substantially complete and the mechanical contractor is advancing with the installation of an additional classifying cyclone which is the final stage in the series of 24k debottlenecking scopes.

The 34MW Tasiast solar power plant continues to advance and remains on schedule for completion in the second half of 2023. Engineering is focused on deliverables for integration with existing power infrastructure. Delivery of materials at site has started and all photovoltaic modules are in transit or have arrived. Construction is underway and earthworks are ongoing. Mechanical works commenced in early February and electrical commenced in March.

At the 70% owned Manh Choh project, activities remain on schedule and on budget, with the early works program progressing as planned. Camp refurbishments were completed in advance of the construction season and all long-lead procurement orders for both the Fort Knox mill modifications and the Manh Choh site have been placed. The Company has selected an Alaska-based supplier for the life-of-mine ore haul trucking and has also awarded the contract mining to a company with significant experience working in Alaska. This contract will include initial construction along with mining and closure activities. Permitting is progressing well and a public comment period is expected to open in early 2023 regarding the Company’s applications. Kinross continues to focus on safely advancing the project, listening to stakeholder concerns, and building on relationships with the local communities and the Native Village of Tetlin.

The is proceeding with the Manh Choh project as the operator of the joint venture. Initial production from Manh Choh is expected in the second half of 2024 and is expected to add approximately 640,000 attributable Au eq. oz. to the Company’s production profile over its approximately 4.5 years life of mine.

Kinross’ activities in Chile are currently focused on La Coipa and opportunities to extend its mine life up to the end of the decade with the potential of additional pushbacks. The Lobo-Marte project continues to provide optionality as a potential large, low-cost mine upon the conclusion of mining at La Coipa. While the Company focuses its technical resources on La Coipa, it will continue to engage and build relationships with communities related to Lobo-Marte and government stakeholders.

In 2023, Kinross expects to produce 2.1 million Au eq. oz. (+/- 5%) from its operations, which is an increase of approximately 140,000 Au eq. oz. compared with 2022 production. Kinross’ annual production is expected to remain stable in 2024 and 2025 at 2.1 million and 2.0 million attributable1 Au eq. oz. (+/- 5%), respectively.

Production is forecasted to be lower in the first quarter of 2023 compared with the rest of the year, mainly as a result of the current shutdown at Tasiast related to the 24k project, the on-going ramp-up including planned mill shutdown at La Coipa, and the seasonal impacts on mining at Paracatu and on the Company’s US heap leach operations.