Kinross Kettle River Update
Toronto, Ontario - Kinross Gold Corporation (TSX-K;
NYSE-KGC) ("Kinross") and Bema Gold Corporation (TSX-BGO; Amex-BGO;
AIM-BAU) ("Bema") are pleased to announce that their respective
boards of directors have approved the recommencement of gold
operations at the Refugio heap leach mine located near Copiapo,
Chile.
Compania Minera Maricunga ("CMM") owns the Refugio mine and is
owned 50% by Kinross (the operator) and 50% by Bema. The Refugio
mine had been placed on care and maintenance in May 2001 due to low
gold prices and has produced declining amounts of gold from
residual leaching of existing heaps since that time. During the
past year, a 56,000 metre drill program was successful in expanding
reserves to justify a greater than 25% expansion of daily
throughput compared to historic production levels. Initially, the
Verde pits are scheduled to produce 40,000 tonnes of ore per day,
which will be crushed and placed on the leach pads. Subsequently,
the new Pancho pit, expected to be mined at 35,000 tonnes of ore
per day, will extend the mine-life to approximately 10 years at an
assumed gold price $350 per ounce. Life-of-mine annual gold
production is expected to range from 230,000 to 260,000 ounces on a
100% basis at total cash costs averaging approximately $225 per
ounce.
Production is expected to recommence late in the fourth quarter
of 2004. Initial capital costs on a 100% basis for the expanded
project are estimated at approximately $71 million to repair and
replace critical components of the existing infrastructure,
increase reliability, improve serviceability and provide a safe and
efficient work environment. In addition, a new mining fleet will be
purchased and is expected to be financed through a capital lease of
approximately $30 million. Major capital items include plant
modifications and upgrades, the purchase of a new mining fleet and
a modest pre- stripping program. A 110-kilometre power line
connected to the Chilean grid will replace the previous diesel
generated power. Kinross is currently evaluating various financing
opportunities for its 50% of capital contributions.
Cautionary Statement on Forward-Looking Information
This press release includes certain "Forward-Looking Statements" within the meaning of section 21E of the United States
Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included herein, including
without limitation, statements regarding potential mineralization and reserves, exploration results and future plans and objectives
of Kinross, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such
statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such
statements. Redevelopment of Refugio is subject to the successful implementation of an economically viable mining plan,
obtaining the necessary permits and approvals from various regulatory authorities, and compliance with operating parameters
established by such authorities. Important factors that could cause actual results to differ materially from Kinross' expectations
are disclosed under the heading "Risk Factors" and elsewhere in Kinross' documents filed from time to time with the Toronto
Stock Exchange, the United States Securities and Exchange Commission and other regulatory authorities. All dollar amounts are
expressed in US dollars unless otherwise stated.