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TORONTO – Kinross Gold Corp. is looking at a plan to downsize initial production from its troubled Tasiast mine in Mauritania, as it tries to mitigate the impact of major cost pressures on the operation.
New chief executive Paul Rollinson also said the company is implementing a new company-wide cost-reduction initiative as its capital and operating costs continue to escalate. The announcements came in the company’s lower-than-expected second quarter earnings report, released Wednesday, a week after former chief executive Tye Burt was fired.
Toronto-based Kinross said it will study an option to build a mill at Tasiast that would process 30,000 tonnes of material, compared to a prior plan of 60,000. The result would be much lower gold production in the early years of mining (before the mill is expanded), but it could also mean lower costs.
The case for a smaller mill “is based on the impact of industry-wide pressures on capital costs, and a better understanding of the Tasiast orebody and associated mine plan,” Kinross said in a statement.