contrast iconcontrast icon search icon

Kinross and Bema Plan to Recommence Gold Mining at Refugio

December 04, 2003

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.

Logo