Kinross Gold to acquire high-quality Chulbatkan heap leach development project for $283mn in Russia

By Daniel Brightmore
Kinross Gold has announced an agreement with N-Mining Limitedto acquire Chulbatkan, a high-quality, heap leach development project with significant upsi...

Kinross Gold has announced an agreement with N-Mining Limited to acquire Chulbatkan, a high-quality, heap leach development project with significant upside potential and low relative execution risk, for a total fixed consideration of $283 million.

Kinross Gold’s President & CEO J. Paul Robinson commented: “Chulbatkan is an exciting high-quality development project with significant upside potential and low relative execution risk located in a country where we have had extensive experience and success, and maintain a strategic and competitive operating advantage. 

“This acquisition is an excellent fit for Kinross as it enables us to leverage our expertise as a world-class cold climate heap leach operator. With a large estimated mineral resource, Chulbatkan has the potential to be a significant low- cost, low-strip, high-return operation that will strengthen our longer-term production and cash-flow profile. It is an excellent complement to our existing operations at Kupol and Dvoinoye, both of which remain prospective in their own right.” 


Kinross Gold acquires two hydro electric power plants in $257 million deal

Kinross Gold and Caterpillar renew global alliance; agree on five-year deal

Kaz Minerals moves into Russia with $900 million acquisition of Baimskaya project

Read the latest issue of Mining Global here

Strategic rationale for acquisition: 

  • High-quality development project with strong upside potential. Large, high-grade, near-surface resource with potential to support a low-cost, low-strip, high-return, open-pit, heap leach operation. Estimated indicated resource of approximately 3.9 million ounces of gold and estimated inferred resource of 80,000 ounces of goldHighly continuous mineralization remains open along strike and at depth with potential for additional high-grade structures within the resource. Multiple promising satellite targets within the under-explored 120 sq. km license.Exploration and mining license in place until the end of 2037. 
  • Leverages operating expertise.Project’s favourable leach characteristics a clear strategic fit with Kinross’ world-class, cold climate heap leach expertise, with features similar to the Company’s Fort Knox mine in Alaska. 
  • Builds on existing regional platform. Expected to strengthen Russia region’s long-term production and cash flow. Kinross has 24 years of operational success in-country, having operated four mines, including developing Kupol and Dvoinoye, two low-cost mines, on budget and on schedule. 
  • Aligns with project pipeline and capital priorities. Expect to conduct a comprehensive exploration program, complete pre-feasibility and feasibility studies within the next three years, and targeting a two-year construction period. This initial timing complements existing Kupol and Dvoinoye operations and Company’s broader project plans. 
  • Maintains strong liquidity position through a mix of cash and shares. Cash and share transaction, and timing of payments, maintains Kinross’ strong liquidity. 

Chulbatkan is a high-grade, open-pit, heap leach project that is expected to be a high-return operation with a low strip ratio, attractive costs, significant upside potential and low relative execution risk. Kinross Gold has completed substantial due diligence on Chulbatkan over the past 16 months, including analysis of eight confirmatory drill holes that showed positive results, and a metallurgical testing program consisting of eight trial leach columns confirming favourable leach characteristics and recoveries. 


Featured Articles

Startup Arkon Energy pours $28m into Bitcoin mining

Australian-based Arkon Energy has secured $28 million in funding to expand renewable Bitcoin mining efforts

KSA’s SWCC signs agreements for brine mining projects

Projects will extract bromine and other salts and minerals for use across Kingdom’s oil & gas, petrochemical, pharmaceutical and metallurgical industries

Glencore to pay over £275mn over Africa mining oil bribes

Glencore Energy UK has been found guilty of seven corruption offences, and has been ordered to pay over £275mn in fines for bribing officials in Africa

Aya Moroccan subsidiary seals US$100m financing for Zgounder

Supply Chain & Operations

Crypto mining firm Core Scientific may be facing bankruptcy

Digital Mining

Rio Tinto and Wright Prospecting modernise Rhodes Ridge JV

Supply Chain & Operations