Kyrgyzstan’s Kumtor mine decreases gold output in Q1 2016

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BISHKEK (TCA) — Canada-based Centerra Gold Inc. and Kumtor Gold Company (KGC) have summed up their operating results in the first quarter of 2016 for the Kumtor gold mine in Kyrgyzstan. In the first three months of 2016, KGC produced 86,444 ounces or 2688.7 kg of gold and contributed more than 1.6 billion soms in taxes and mandatory payments to Kyrgyzstan’s state budget, Kumtor Gold Company said on May 19.

Gold production for the first quarter of 2016 was 86,444 ounces compared to 164,272 ounces of gold in the comparative period of 2015. The decrease in ounces poured in the first quarter of 2016 resulted from the processing of lower grade ore mined from cut-back 17 which was blended with lower grade stockpiles. In contrast, during the comparative quarter of 2015, the Company mined and processed ore from the higher grade final benches from cut-back 16.

At Kumtor, 2016 total capital expenditures, excluding capitalized stripping, are forecast to be $110 million. Spending on sustaining capital of $84 million relates primarily to major overhauls and replacements of certain heavy duty mine equipment ($69 million), construction to raise the tailings dam ($6 million) and other items ($9 million).

Growth capital investment at Kumtor for 2016 is forecast at $26 million and includes the relocation of certain infrastructure at Kumtor relating to the ongoing Kumtor pit expansion ($17 million), dewatering projects ($6 million) and other items ($3 million).

The cash component of capitalized stripping costs related to the development of the open pit is expected to be $122 million of the $162 million total capitalized stripping in 2016.

“Kumtor had strong gold production in the quarter producing 86,444 ounces which was in line with our expectations,” said Scott Perry, CEO of Centerra Gold, which owns Kumtor Gold Company. “Our team continues to pursue a number of business improvement opportunities at both the operational and corporate levels. The Kumtor mine is expected to produce between 480,000 and 530,000 ounces, or 14,9 and 16,5 tonnes, of gold in 2016. At Kumtor this year, it is expected that gold production will be weighted more towards the second half of the year as the higher grade portion of the SB Zone will be accessed at the end of the second quarter.”

Sergey Kwan

TCA