The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Russian foreign investment commission okays sale at half price North of 60 Mining News – June 17, 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. has finalized the sale of its Kupol Mine and gold exploration properties in Russia's Far East to the Highland Gold Mining group of companies for US$340 million in cash.
On June 15, Kinross reported that it has already received $300 million in U.S. denominated cash in its corporate account and will receive a deferred payment of $40 million on the one-year anniversary of closing the sale of all its assets in Russia.
Highland Gold Mining had previously agreed to pay $680 million for Kinross' Russian gold assets, which included an upfront payment of $100 million and $580 million in scheduled annual payments from 2023 through to 2027. The recently formed Russian Sub-commission on the Control of Foreign Investments, however, approved the sale for a price not to exceed $340 million.
Kinross, which had previously cited concerns about the destruction and loss of life being caused by Russia's invasion of Ukraine, decided to accept the half-price deal in order to divest all its interests in Russia and have no further obligations or liabilities in the country.
With the finalization of the divesture of its Russian assets, along with the pending sale of its Chirano gold mine in Ghana and acquisition of the Great Bear Resources gold mine project in Ontario, Kinross has reshaped the geographic mix of its portfolio, with roughly 70% of its production coming from the Americas.
"After the completed divestment of our Russian business, Kinross' rebalanced portfolio maintains a substantial production outlook anchored by its two tier one assets – Tasiast and Paracatu – as well as a strong portfolio of mines in the Americas, a growing business in Chile, and the large, world-class Great Bear project in Canada," said Kinross President and CEO J. Paul Rollinson. "We would like to thank our Russian workforce for their dedication, professionalism and hard work. Their ongoing commitment to safety and the environment, especially during the transition of our business in the country, has been commendable."
With its rebalanced portfolio, Kinross now expects to produce 2.15 million gold-equivalent ounces this year at an all-in sustaining cost of US$1,150 per gold-equivalent-oz produced.
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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