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Kinross, Mauritania reach tentative deal for Tasiast Sud

Kinross Gold has reached a tentative deal with the Mauritania government that could provide it with a 30-year exploitation licence and expedited permitting for its proposed Tasiast Sud project.
Kinross, Mauritania reach tentative deal for Tasiast Sud Kinross, Mauritania reach tentative deal for Tasiast Sud Kinross, Mauritania reach tentative deal for Tasiast Sud Kinross, Mauritania reach tentative deal for Tasiast Sud Kinross, Mauritania reach tentative deal for Tasiast Sud

Kinross Gold has reached a preliminary deal with the Mauritania Government on development of Tasiast Sud

Staff Reporter

The Toronto-headquartered company said the agreement would also reinstate a tax exemption on fuel duties and allow repayment of US$40 million in outstanding tax refunds to the company with an agreed payment schedule through to 2025.

Kinross has agreed to pay $10 million to Mauritania's government to resolve legacy disputes relating to fuel use and tax exemptions, and a further $15 million to resolve prior licensing issues.

Kinross said it would update the royalty structure for Tasiast so that it aligned with Mauritania's current mining conventions and codes in hopes it would strengthen "the foundation for long-term stability and further align interests by ensuring the country receives an appropriate share of economic benefits from the Tasiast mine".

CEO Paul Rollinson said the deal was a sign of a "positive" foreign investment climate.

The renewed "partnership approach" for Tasiast Sud has government receiving a 15% free carried interest in Tasiast Sud with an option to buy a further 10%.

Kinross is currently implementing the Tasiast 24k project, aimed at increasing throughput by 50% to 21,000 tonnes per day by 2021, at a cost of $150 million. The project will see throughput rise to 24,000t/d by 2023, helping extend the mine life to 2033. The company has guided for 563,000oz gold produced from Tasiast in 2023, up from 391,097oz gold-equivalent produced in 2019.

The parties have also agreed to expand the Tasiast Sud exploration programme, aimed at upgrading indicated and inferred resources of about 1Moz and expanding proven and probable reserves of 144,000oz.

Kinross shares (TSX: K) were up 4.7% Monday to C$8.83, capitalising the company at C$11.1 billion.