The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Will not make further investments as it negotiates with buyer North of 60 Mining News – April 1, 2022
Trucks deliver supplies over a winter road to Kinross' Kupol gold mine in the Chukotka region of Russia's Far East.
Kinross Gold Corp. March 29 announced plans to divest all its Russian assets, including its Kupol gold mine.
Citing concerns about the destruction and loss of life being caused by Russia's invasion of Ukraine, the gold mining company announced in early March that it had decided to suspend all activities at its gold projects in the Russian Far East.
Kinross' Kupol Mine in the Chukotka region of eastern Russia produced 481,108 ounces of gold-equivalent, which includes the value of both the gold and silver produced during 2021. This one mine accounted for roughly 23% of the gold-equivalent oz produced by the company last year.
Despite being the second largest and lowest cost gold mine in its portfolio, Kinross has decided to wind down operations at Kupol and Udinsk, where the company had been working toward developing another gold mine in Russia's Far East.
Since making the announcement, Kinross has received several proposals regarding its Russian business and says it is now in exclusive negotiations with a third-party mining company regarding a potential sale of 100% of its assets in the country.
As part of the exclusivity agreement and to properly maintain assets pending a change of control, Kinross' Russian subsidiaries are continuing to operate during the transition period.
Kinross will also continue to manage and mitigate the environmental impacts of its operations. This includes overseeing monitoring systems and transporting industrial materials to the Kupol mine that are not permitted to remain at the port to maintain safety and regulatory compliance. Kinross will continue to prioritize the well-being of its more than 2,000 employees in the country as it develops its transition plan.
Kinross says the ongoing activities will be funded through resources already in Russia, and it will not make any further investments that will not benefit financially from the operations while the transition plan is finalized.
From an accounting perspective, Kinross expects to treat its Russian business as an asset held for sale until a change of control is completed.
Any such divestitures or change of control would be subject to Russian government approval.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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