KINROSS Gold saw a “very low” risk of political unrest in Mali spreading to Mauritania, its neighbour to the north where Kinross has a gold mine with plans to expand.
“We don’t see the Mali issue coming to Mauritania,” CEO Paul Rollinson told the Gold Forum Americas conference.
Mali’s president was toppled in a coup last month, further destabilising a country battling a jihadist insurgency and civil unrest.
Kinross operates the Tasiast mine in Mauritania. The mine accounted for about 15% of Kinross’ June quarter gold output, yielding some 88,579 ounces in the period compared to 92,901 oz in last year’s June quarter. Gold sales were higher, however: up to 98,679 oz (2019: 94,748 oz).
Kinross has not been without its challenges at Tasiast this year not least of which were the unique pressures of the Covid-19 pandemic. In addition to this, employees at the mine embarked on a 17-day strike, since resolved.
The company also decided to overhaul Tasiast mine’s royalty agreement with the Mauritania government that could potentially see the Canadian firm double the royalty were the gold price to average the current spot price of $1,717/oz.
The new royalty agreement was in recognition of the fact Mauritania had in 2018 updated its mining code and that similar steps had been taken by Mauritania’s African neighbours. The current royalty scheme between Kinross and the Mauritanian government was per a convention drafted in 2006.
Kinross last year approved the $150m expansion of Tasiast which would increase gold production to an average of 563,000 oz/year between 2022 and 2028 from the 391,097 oz it mined in 2019.
