Revista Nueva Minería

In parallel, the company is reviewing the feasibility studies of Lobo Marte project, likely to be smaller to reduce investment for their development

Kinross Gold Corporation in November will materialize paralyzing Mantos de Oro chores, a company through which blows the site The Coipa, one of the oldest gold mines in the country, with over 20 years of operation.

The drop in metal prices explains part of the Canadian company decision, because although the planned stoppage for some time, due to the age of the operation, during the final date of the suspension was postponed.-

In fact, the financial report of Mantos de Oro at the first half says that the Coipa has spread its life beyond its original mining plan, thanks to investments made and the discovery and exploitation of several pits, which allowed producing continuously for two decades.

The External Affairs Vice President of Kinross Mining Chile, Jose Tomas Letelier, said under the situation of metal prices and higher costs depleted economically exploitable reserves of La Coipa, that will eventually be processed by the end of this month or early next, said.

“In another scenario of prices, probably it could have continued to operate other site of the mine,” he added.

During the first half La Coipa produced 101,966 gold ounces equivalent, up 38% over the same period in 2012, while its production cost was about 
 U.S. $ 735 per ounce, down from 
 U.S. $ 1,061 June preceding.

The gold price therefore average so far this year U.S. $ 1,451.95 per ounce, according to the report as of yesterday by Chilean Copper Commission (Cochilco), 12% less than the average for 2012.

Temporary Suspension

The executive said the decision was opportunely reported to unions with whom they agreed on a formula of dismissal for workers who cannot be relocated to the other operation that the company has in the country: Maricunga.

In addition, another group of workers, of a total of 460 workers, will remain linked to Mantos de Oro, because as Letelier said we are facing a closure of a mine, but this is a termporal-partial paralysis (PTP), is means that the equipment will undergo maintenance like mine, so that before a recovery in La Coipa price conditions can be reopened.

Letelier recalled that the PTP are not a new phenomenon in the local mining, as in 2001 and for four years, due to the falling price of gold, were suspended Maricunga operations, as was the case with other tasks as Cerro Bayo in Aysen region.

Projects

Kinross is deploying a formula to quickly react to a future rise in the gold market conditions, but for now these productive adjustments, said Letelier, also resulted in a reorganization of the company structure in the country, with a workers and administration costs reduction at the headoffice.

At the project level, in the area of La Coipa detected a new field called Phase 7 which is at feasibility stage and a few weeks ago was removed from the environmental assessment for further information “for presentation at some point in the future” said the executive.

Regarding Lobo Marte, greenfield Project (new) of gold also, which remains in the pipeline because the company prioritized investments in Mauritania and Russia, Letelier said that while the environmental assessment of the project is suspended at the request of the company, they are reviewing engineering with the purpose of reducing the size of the mine and thus lower investment it requires, which would facilitate a decision by the Canadian mining Company.

Source: Diario Financiero