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GOLD MINE EXPANSION – Kinross adding 50,000 oz to Paracatu output

BRAZIL - The board of Canada's KINROSS GOLD has approved a US$111-million expansion to 250,000 oz from an average 2...


BRAZIL – The board of Canada’s KINROSS GOLD has approved a US$111-million expansion to 250,000 oz from an average 200,000 oz/year of gold at its 100%-owned Paracatu mine in southeast Brazil, said company CEO Robert Buchan. Average output of 300,000-oz-plus is planned for five years starting early 2007, and the mine plan extends to 2025, he told the BMO Nesbitt Burns Global Resources Conference in Florida.

The expansion involves increasing milling capacity to 30 million tonnes from 18 million tonnes/year by replacing the existing crusher with a SAG mill that would boost recoveries, lower costs and increase resources due to a lower cutoff grade. Kinross has already placed an order for the SAG mill with an expected delivery time of 18 months.

The company is also contemplating a second phase expansion costing 60-70% of the first-phase cost, which would take production to 600,000 oz/year over 20 years, said Buchan. The second expansion, if current exploration goes as planned, would involve increasing milling capacity to 50 million tonnes/year by adding two ball mills to the crushing, flotation and cyanide processing system. If approved, it could be brought onstream relatively quickly in 2008-09.

Buchan said that he was “confident” the aggressive drill program underway would add resources to Paracatu in two or three months. Five of the seven drills there are focused on West Rico Creek to the west of the current pit that could provide a reserve increase of 3-4 million oz. The next focus will be the current pit at depths that have not been completely drilled out. Current reserves stand at some 8 million oz of gold.

Paracatu, also known as Morro do Ouro, is near Brasilia in the state of Minas Gerais. A technical report on the mine is posted at www.Kinross.com.


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