Paracatu And Tasiast On Track To Increase Production At Lower Costs

J. Paul Rollinson, President and CEO of Kinross, said, “The Company had higher production compared with the first quarter and we continue to expect stronger production and lower costs in the second half of the year to generate an increase in free cash flow. Paracatu and Tasiast are on track to increase production at lower costs for the rest of the year, with the La Coipa mill expected to continue ramping up, contributing to our higher production. With the completion of the sale of our Russian assets and pending sale of Chirano, approximately 70% of our production is now based out of the Americas. The new re-balanced portfolio is bolstered by our robust development projects, which all advanced well over the quarter. At the world-class Great Bear project in Red Lake, Ontario, drilling results continue to show the significant potential of a deposit that can host a large, long-life mining complex. At Manh Choh in Alaska, we completed a feasibility study ahead of schedule, and are proceeding with a project that we expect will add approximately 640,000 lower-cost gold ounces to our production profile over its life of mine in one of the world’s best mining jurisdictions.

Looking ahead, we believe we have significant value upside. We are in excellent financial position, have strong liquidity of $2.1 billion, and continue to prioritize and strengthen our investment-grade balance sheet while returning capital to our shareholders. Our high-quality portfolio has a competitive reserve life, with production expected to increase to 2.3 million gold ounces next year, and average two million gold ounces per year over the remainder of the decade.”

Kinross is on track to significantly increase production in the second half of the year, primarily driven by stronger production at Paracatu, Tasiast and La Coipa. The Company expects to be at the low end of its 2022 production guidance range mainly due to temporary delays in the mill ramp-up at La Coipa. It expects to maintain a substantial production profile with estimated average production of two million Au eq. oz. per year over the remainder of the decade. In addition its 2022 production cost of sales are expected to be approximately $900 per Au eq. oz. sold and all-in sustaining cost to be approximately $1,240 per Au eq. oz. sold2, mainly due to the impact of the temporary delay in La Coipa’s mill ramp-up and inflationary pressures across the portfolio. Consolidated production cost of sales was $8328 per Au eq. oz. sold and attributable all-in sustaining cost of sales was $1,1382, 8 per Au eq. oz. sold for the year ended December 31, 2021. The Company continues to expect costs to decrease during the second half of the year largely due to the anticipated increase in production. Kinross is on track to meet its 2022 capital expenditures guidance of $850 million (+/- 5%).

Kinross is proceeding with development of the 70%-owned Manh Choh project in Alaska, which is expected to increase the Company’s production profile by approximately 640,000 attributable Au eq. oz. over the life of mine at lower costs. The world-class Great Bear project in Red Lake, Ontario continues to make excellent progress, with drilling results from the first half of the year continuing to confirm Kinross’ vision of developing a large, long-life mining complex. The Company plans to declare an initial mineral resource estimate as part of its 2022 year-end results. The Tasiast 24k project remains on plan to reach 24,000 tonnes per day throughput in mid-2023.

Kinross previously announced the completion of the sale of 100% of its Russian assets to the Highland Gold Mining group of companies for $340 million in cash. It also announced the sale of its 90% interest in the Chirano mine in Ghana to Asante Gold Corporation for total consideration of $225 million in cash. The sale is expected to close in August 2022.