Kinross Gold to shed 25-per cent stake in Cerro Casale
19 February 2010
Canadian gold miner Kinross Gold has decided to sell a 25-per cent stake in Cerro Casale project in Chile to Barrick Gold, the world's largest gold producer, at an estimated cost of $475 million.
The deal is planned by paying $455 million in cash and the assumption of a $20 million contingent obligation.After the deal, Barrick will hold 75 per cent stake in the joint venture, with Kinross holding the balance 25 per cent, the company said yesterday, while announcing its annual report.
The Cerro Casale project contains more than 23 million ounces of gold and 6 billion pounds of copper.
Tye Burt, president and CEO of Kinross said, "We announced the sale of half of our share of Cerro Casale, which scales the project to a more optimal size within our portfolio, and generates immediate cash proceeds''.
''We continue to make adjustments to our asset portfolio to improve shareholder value, such as the acquisition of Dvoinoye near our Kupol mine in Russia, which expands our presence in this rapidly growing new district,'' he added.
Kinross produced 613,858 gold equivalent ounces in the fourth quarter of 2009, a 12 per cent increase over the fourth quarter of 2008, and 2,238,665 gold equivalent ounces for the full year, a 22 per cent increase over 2008 as a whole.