By
Reuters
Published
Feb 28, 2012
Reading time
2 minutes
Download
Download the article
Print
Text size

Kinross may sell its stakes in Crixas, Cerro Casale

By
Reuters
Published
Feb 28, 2012

TORONTO - Kinross Gold (K.TO) (KGC.N) may consider selling its 50 percent interest in the Crixas underground gold mine in Brazil and its 25 percent stake in the Cerro Casale gold-silver-copper project in Chile, Chief Executive Tye Burt said on Monday.

"Would we dispose of further assets? Of course," said Burt in response to a question at the BMO Global Metals and Mining Conference in Hollywood, Florida.

"We do have a tradition of monetizing or selling assets ... so that's a continuous portfolio review process," he said.

Last year, the Canadian company sold an 8.5 percent equity interest in diamond miner Harry Winston (HW.TO) for about C$100 million. This followed its 2010 sale of a 22.5 percent interest in the partnership holding Harry Winston's 40 percent interest in the Diavik Diamond Mines joint venture.

"The short take on this is we are always open to ideas," said Burt. "We don't feel we need to sell assets to fund our future growth, given our balance sheet and our operating cash flow, but we are always open to ideas on non-core assets."

"Assets like Crixas with a relatively short life ahead of it, we'd be open to ideas on," said Burt.

South African gold miner AngloGold Ashanti (ANGJ.J) is the operator at Crixas and owner of the remaining 50 percent stake. The mine, which produced 66,583 ounces of gold in 2011, is located northwest of Brasilia.

Shares of Kinross have been under pressure over the last few months, and earlier this month the company booked a $2.94 billion non-cash goodwill impairment charge related to its acquisition of the Tasiast and Chirano mines. The miner acquired the West African gold mines through its $7.1 billion takeover of Red Back Mining in 2010.

"Cerro Casale, we sold our first 50 percent of that asset to Barrick two years ago, that's one which is at the back-end of our pipeline, but under review currently," Burt added.

Kinross currently owns a roughly 25 percent stake in the Cerro Casale project in Chile. Barrick Gold (ABX.TO) the world's top gold miner, owns the remainder of the project.

In 2010, Kinross sold a 25 percent stake in the project to Barrick for about $454 million in cash, plus the assumption of a $20 million contingent obligation.

($1=$1 Canadian)

(Reporting By Euan Rocha; editing by Rob Wilson)

© Thomson Reuters 2024 All rights reserved.