Kinross to Halt Ecuador Project
Jun 11th 2013 11:10AM
Updated Jun 11th 2013 12:35PM
Kinross Gold is pulling back a bit on its South American operations. The company announced Monday that it will not continue to develop its Fruta del Norte project in Ecuador.
In the press release announcing the development, the company said that following more than two years of negotiations, it and Ecuador's government "have been unable to agree on certain key economic and legal terms which balance the interests of all stakeholders."
Kinross added that it is unlikely to be able to sell its 100% stake in the gold and silver venture. The firm attributes this to the government's current stance, and previous indications that it would not approve a sale. The company said that when the current economic evaluation phase of the project expires on Aug. 1, the La Zarza concession, which contains the entire FDN mineral resource, will revert to the government.
Kinross estimates it will have to book a charge of roughly $720 million in Q2 in related expenses. It believes around $700 million of that amount will be non-cash.
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