Canada’s Kinross Gold (TSX: K; NYSE: KGC) has resumed mining and construction work at the expansion of its Tasiast mine, in Mauritania, but milling activities will remain suspended for now following last week’s fire.
The Toronto-based miner said early estimates indicate the SAG mill would only restart by year-end, at a cost of up to $50 million.
Kinross has lowered its 2021 production guidance to 2.1 million gold-equivalent ounces, from its previous forecast of 2.4 million ounces. The 2022 and 2023 guidance of about 2.7 million to 2.9 million gold-equivalent ounces remain unchanged, the company said.
Based on the initial estimate of the mill’s downtime and with ongoing work on the 24k project, Tasiast’s throughput capacity is now expected to reach 21,000 tonnes per day during Q1 2022, compared with the previous estimate of year-end 2021. Throughput capacity is expected to increase to 24,000 tonnes per day by mid-2023, which is unchanged from the original 24k project estimate.
“Although this unfortunate incident is expected to impact our annual production guidance, our financial position and longer-term outlook remain very strong,” CEO J. Paul Rollinson said in the statement.
Tasiast is one of company’s three largest operations, which include Paracatu in Brazil and Kupol in Russia. Together, they accounted for 62% of Kinross’ 2020 production and were its lowest-cost mines for the second year running.
Kinross does not anticipate the fire will affect Tasiast’s life-of-mine production and mineral reserve estimates, or have a material impact on the mine’s overall value.