Kinross Gold Q1 2025 Earnings Report

Kinross Gold EPS Results

• Actual EPS: $0.30
• Consensus EPS: $0.22
• Beat/Miss: Beat by +$0.08
• One Year Ago EPS: $0.10

Kinross Gold Revenue Results

• Actual Revenue: $1.44 billion
• Expected Revenue: $1.43 billion
• Beat/Miss: Beat by +$5.79 million
• YoY Revenue Growth: +38.50%

Kinross Gold Announcement Details

• Quarter: Q1 2025
• Date: 5/6/2025
• Time: After Market Closes
• Conference Call Date: Wednesday, May 7, 2025
• Conference Call Time: 7:45AM ET

Kinross Gold (NYSE:KGC), together with its subsidiaries, engages in the acquisition, exploration, and development of gold properties principally in the United States, Brazil, Chile, Canada, and Mauritania. The company operates the Fort Knox mine and the Manh Choh project in Alaska, as well as the Round Mountain and the Bald Mountain mines in Nevada, the United States; the Paracatu mine in Brazil; the La Coipa and the Lobo-Marte project in Chile; the Tasiast mine in Mauritania; and the Great Bear project in Canada. It is also involved in the extraction and processing of gold-containing ores; reclamation of gold mining properties; and production and sale of silver. Kinross Gold Corporation was founded in 1993 and is headquartered in Toronto, Canada.

Kinross Gold Q1 2025 Earnings Call Transcript

Presentation

[Operator]

Thank you for standing by. My name is Ian, and I will be your conference operator today. At this time, I would like to welcome everyone to the Kinross Gold First Quarter twenty twenty five Results Conference Call and Webcast. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.

[Operator]

Thank you. I would like to hand the call over to David Shaver, Senior Vice President, Investor Relations and Communications. Please go ahead.

[David Shaver, Senior Vice President of Corporate Development at Kinross Gold]

Thank you, and good morning. In the room with us today on the call, we have Paul Rollinson, CEO and from the Kinross Senior leadership team, Andrea Freeborough, Claude Schimper, Will Dunford and Jeff Gold. For a complete discussion of the risks and uncertainties which may lead to actual results differing from estimates contained in our forward looking information, please refer to Page three of this presentation, our news release dated 05/06/2025, the MD and A for the period ended 03/31/2025, and our most recently filed AIF, all of which are available on our website. I will now turn the call over to Paul.

[J. Paul Rollinson, CEO at Kinross Gold]

Thanks, David, and thank you all for joining us. This morning, I will discuss our first quarter results, provide high level updates across our portfolio, comment on sustainability and confirm our outlook. I will then hand the call over to Andrea, Claude and Will to provide more detail. Following outstanding performance in 2024, we continued to deliver strong results in the first quarter. Our culture of technical excellence and financial discipline, complemented by our consistent operating performance, continues to drive significant margins and cash flow for our business.

[J. Paul Rollinson, CEO at Kinross Gold]

Our financial position and cash flow outlook remains excellent. And as a result, we are enhancing capital returns for shareholders. Q1 was a great start to the year with production of 512,000 ounces. As is compared to Q2, had another notable quarter and together accounted for more than half of our production and drove significant cash flow. Tasiast saw strong output in Q1 supported by strong grades and recoveries.

[J. Paul Rollinson, CEO at Kinross Gold]

Claude will elaborate further, but after a brief shutdown due to a fire in April, the mill was recently restarted and Tasiast remains on track to meet its original full year guidance. Hurricane two delivered another excellent quarter on the back of strong grades and improved mill recoveries. La Coipa and our U. S. Assets also delivered production costs as planned.

[J. Paul Rollinson, CEO at Kinross Gold]

Turning now to updates on our projects. Our in house technical and project execution teams made notable progress in Q1 across our pipeline of mine life extensions and growth projects that underpin our long term production profile. At Curlew, ongoing resource drilling is returning exciting results, with recent assays demonstrating substantial grades and widths supporting future high margin production. At Round Mountain, underground development at Phase X is advancing well. And as outlined in our news release, we are continuing to see strong exploration results from infill drilling.

[J. Paul Rollinson, CEO at Kinross Gold]

At Lobo Marte, baseline studies to support the Project EIA are progressing well. At Great Bear, the advanced exploration program continues with construction and earthworks underway. Regarding the main project, we continue to advance our permitting efforts working with the Impact Assessment Agency of Canada. And we've also kicked off detailed engineering on the mill and site infrastructure to advance the main project towards construction. Turning now to sustainability.

[J. Paul Rollinson, CEO at Kinross Gold]

I am pleased to say that our annual sustainability report will be published later this month. This comprehensive report, which is in its seventeenth edition, provides an update on all the progress we made in 2024 and what we aim to accomplish this year and beyond. It's an impressive document, which I encourage you all to review. Moving to our outlook. Following a strong first quarter, we are firmly on track to achieve our production, cost and capital guidance for the year.

[J. Paul Rollinson, CEO at Kinross Gold]

As we did last year and in Q1, we will continue to maintain our financial discipline and prioritize cost management in order to deliver strong margins and cash flow. With this positive outlook, I am pleased to say that in addition to our dividend, we have enhanced our return of capital by reactivating our share buyback. This should provide a substantial year over year increase in return of capital to our shareholders. With that, I'll now turn the call over to Andrea.

[Andrea Freeborough, Executive VP & CFO at Kinross Gold]

Thanks, Paul. This morning, I will review our financial highlights from the quarter, provide an overview of our balance sheet and return of capital plan, and comment on our outlook. As Paul noted, we had a strong start to the year in Q1. We produced 512,000 gold equivalent ounces and sold 506,000 ounces. As per plan, Q1 cost of sales of $10.38 dollars per ounce and all in sustaining cost of $13.55 dollars per ounce were lower than our guidance for the year.

[Andrea Freeborough, Executive VP & CFO at Kinross Gold]

Q1 costs were also lower than the prior quarter, benefiting from more ounces produced, lower energy and lower maintenance costs. Q1 margins were strong at over $1,800 per ounce, increasing over the prior quarter and outpacing the increase in the gold price. In Q1, our adjusted earnings were adjusted operating cash flow was $676,000,000 Attributable CapEx was $2.00 $4,000,000 with higher spending expected for the rest of the year to conform with our annual guidance. Attributable free cash flow was $371,000,000 or $472,000,000 excluding changes in working capital. Free cash flow in Q1 was lower compared to the prior quarter expected due to annual tax payments in Brazil and Mauritania.

[Andrea Freeborough, Executive VP & CFO at Kinross Gold]

Turning to the balance sheet. Our financial position continued to improve in Q1. Following the repayment of the final $200,000,000 on our term loan, we ended the quarter with $695,000,000 in cash and approximately $2,300,000,000 of total liquidity, both increasing from year end. We improved our net debt position to $540,000,000 and our trailing twelve month net debt to EBITDA ratio to 0.2 times compared to 0.3 times as of year end. With the term loan now fully repaid and our strong cash balance at the end of Q1, we are increasing our returns to shareholders.

[Andrea Freeborough, Executive VP & CFO at Kinross Gold]

Our quarterly dividend of $03 per share remains in place. In addition, we have reactivated our share buyback program and to date have repurchased $60,000,000 in shares. Based on recent gold prices, we're aiming to repurchase a minimum of $500,000,000 of our common shares this year, which would increase our total return of capital to $650,000,000 representing an increase of over 300% compared to last year. Our shares continue to represent an attractive use of excess cash given our favorable relative valuation and strong free cash flow metrics. With our strong cash flow outlook, we expect to continue returning a substantial amount of capital to shareholders while also building cash on the balance sheet, with a view to repay the $500,000,000.20 27 notes at or before maturity.

[Andrea Freeborough, Executive VP & CFO at Kinross Gold]

At today's gold prices, we expect to be in a net cash position by the end of the year. Lastly, during the quarter, Moody's performed their annual review, revising our outlook to positive from stable and reaffirming our investment grade credit rating. Turning to our guidance. We remain solidly on track to produce 2,000,000 ounces at a cost of sales of $11.20 dollars per ounce, an all in sustaining cost of $1,500 per ounce. Operating costs are expected to increase throughout the rest of the year for three reasons.

[Andrea Freeborough, Executive VP & CFO at Kinross Gold]

First, stripping costs at Round Mountain Phase S and Fort Knox Phase 10 are currently being capitalized, and we expect both to be characterized as operating costs for accounting purposes from midyear. Second, we continue to expect inflation in the range of 3% to 4% on average for the year. And third, we had slightly stronger production in Q1, providing a favorable denominator on fixed costs, with production in the remaining quarters expected to deliver our annual guidance of 2,000,000 ounces. Capital expenditures remain on track to meet guidance of $1,150,000,000 I will now turn the call over to Claude to discuss our operations.

[Claude Schimper, EVP & COO at Kinross Gold]

Thank you, Andrea. Delivery of our safety excellence program has now been completed, including at the corporate office, and refresher training has begun in some sites. In the first quarter, we placed significant focus on our leading safety practices. We conducted 54 operational learning teams and over 28,000 field engagements. This quarter, our operations continued their strong performance, delivering production of 512,000 ounces.

[Claude Schimper, EVP & COO at Kinross Gold]

Starting with Tasiast, mine delivered strong results in the first quarter with production of 138,000 ounces at a cost of sales of $811 per ounce. Tasiast performed well during the quarter, driven by strong grades and recoveries following a variety of optimization initiatives in the mill. Production was lower over the prior quarter due to lower throughput as we continue to work through enhancements to improve recoveries. Following the fire incident in mid April, I'm pleased to see how effectively our site team responded to quickly restart the mill. With critical spare parts already on-site, the site team was able to expedite repairs, reducing the downtime and mitigating the impact to production.

[Claude Schimper, EVP & COO at Kinross Gold]

With the strong mining rates we saw in the first quarter, Tasiast was tracking ahead of its mine plan, allowing for the accumulation of high grade material. Processing of this high grade material has commenced and is expected to offset production that was budgeted from lower grade stockpiles this year. Tasiast is still expected to deliver its production guidance of 500,000 ounces at a target cost of sales of $860 per ounce this year. Paracatu delivered another solid quarter with production of 147,000 ounces at a cost of sales of $951 per ounce. Production increased over the prior quarter due to the strong grades and the timing of ounces processed.

[Claude Schimper, EVP & COO at Kinross Gold]

The quarter also saw strong production on the back of improved recoveries, which are benefiting from our continuous improvement initiatives, including the recent implementation of an additional cavity circuit at the plant. The site team were able to mitigate the impacts from the significant rainfall experienced in the first quarter, delivering on budget. Production at Baraka 2 is expected to be higher and costs lower this year as mining continues within the high grade portion of the pit. Baraka 2 remains on track to meet its guidance of 585,000 ounces at a cost of sales of $10.25 dollars per ounce. At La Coipa, we produced 52,000 ounces at a cost of sales of $11.47 dollars per ounce in the first quarter.

[Claude Schimper, EVP & COO at Kinross Gold]

Production was lower over the prior quarter, mainly due to the timing of ounces processed through the mill and lower planned throughput, partially offset by higher grades from the Puerren deposit. Okuipa is on track to meet its guidance of 230,000 ounces at a cost of sales of $10.60 dollars per ounce in 2025. Moving to our U. S. Operations.

[Claude Schimper, EVP & COO at Kinross Gold]

Production in the first quarter was as planned. Collectively, The U. S. Sites delivered first quarter production of 176,000 ounces at a cost of sales of $12.46 dollars per ounce. At Fort Knox, First Quarter production of 94,000 ounces was higher over the prior quarter as a result of higher processing grades and higher recoveries from Mancho ore driving strong free cash flow.

[Claude Schimper, EVP & COO at Kinross Gold]

Ore tonnage from Mancho was higher than budgeted in the first quarter due to the timing of and some improvements in the ore transport system. With stronger volumes in the first quarter, the remaining campaigns this year are expected to see slightly lower average tonnages than the 200,000 to 220,000 tonnes per campaign that was outlined at year end. At Bald Mountain, we produced 46,000 ounces at a cost of sales of $11.23 dollars per ounce. Production was in line over the prior quarter, while costs were slightly lower due to higher capitalized mining costs. At Red Bird, mining activity for Phase one commenced in January and is advancing on schedule.

[Claude Schimper, EVP & COO at Kinross Gold]

At Round Mountain, production of 36,000 ounces was lower compared to the prior quarter due to the mine sequencing as mining transitions from the end of Phase W into Phase S stripping. Cost of sales of $15.95 dollars per ounce was lower due to the lower consumable costs. Mining at the Phase S open pit remains on schedule, with stronger production contributions expected towards the end of the year. With that, I'll now pass the call over to William to discuss our projects.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Thanks, Claude. As highlighted last quarter, we have significant optionality from a number of mine life extensions and growth projects that sit in our resource base and underpin our potential future production profile. Our strong internal technical team is focused on drilling, technical studies and permitting across this pipeline of growth projects to advance them into our production profile, while also progressing exploration to bring new projects into our resource. Here, you can see updates on a few of those studies that our team is working on. At La Coipa, study and permitting work is progressing well for the oxide extension opportunities.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

The extensions being permitted are primarily focused on an additional open pit layback at Pier N, an area where we are already mining today. At Bald Mountain, technical studies optimization work and detailed engineering for Phase two is progressing well. Phase two would bring in an additional 680,000 contained ounces to the mine plan and extend production out to 02/1931. We expect to complete our technical work to support an execution decision by year end at Red Bird. At Tasiast, we are progressing both drilling and technical studies to support mine life extensions beyond 02/1935 through optionality that we can see in our resource, which includes 2,400,000 ounces of M and I and 1,600,000 ounces of inferred.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

We are working on both open pit and underground extension options at West Branch, where our mineralization clearly extends at depth, alongside exploration for satellite mining targets on the wider property. At Lobo Marte, baseline studies to support our EIA are progressing well. We are also progressing technical work and will provide a project update by next year. Moving to Kirlou, drilling in Q1 continued to highlight wider and higher grade zones of mineralization, further improving the quality of the project and showing potential for high margin production. For example, at Stealth, we intercepted 10 meters at 16 grams per tonne, and at K-five, we intercepted 26 meters at eight grams per tonne.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Technical studies and detailed engineering are progressing well to support a potential restart of operations at Kurlu using our Kettle River processing facility. Underground development was also reinitiated in Q1 to extend our decline at depth towards Roadrunner and along strike at Stealth to target further extensions of high grade mineralization. You can see on the slide, we are extending our development along a paleo surface that controls our productive horizon and has produced multiple historic mines, but has been underexplored at depth, providing potential for further extension of mineralization. We expect to provide a resource and project update for Kirlou with our twenty twenty five year end results. At Phase X, underground development continues to advance with over 3,900 meters developed to date.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Infill drilling is also progressing well, and as you can see on the slide, we now have good coverage of the upper target zone and are focused on expanding coverage in the lower zone. The table on the slide shows all the results from Q1 in the lower zone. As you can see, the grades and widths further reinforce our exploration thesis of a bulk three to four gram per tonne deposit at Phase X. The completion of this drill program will put us in a position to provide an initial underground resource estimate and a project update for Phase X with our twenty twenty five year end results. In parallel, we are progressing technical studies and detailed engineering to support project execution.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Moving to Great Bear, AEX surface works are progressing, including excavation for the decline infrastructure and construction of pads for the camp and stockpiles. Detailed engineering is nearly complete for AEX, and our procurement is advancing in line with the construction schedule. We remain on track to start the underground decline later this year, subject to permitting. For the main project, we have initiated detailed engineering for the mill and other critical site infrastructure and are continuing to advance our permitting efforts. I will now turn the call back to Paul for closing remarks.

[J. Paul Rollinson, CEO at Kinross Gold]

Thanks, Will. After a strong start to the year, we are well positioned to meet our targets in 2025. Looking forward, we are excited about our future. We have a strong production profile. We're generating significant free cash flow.

[J. Paul Rollinson, CEO at Kinross Gold]

We have an excellent balance sheet. We have an attractive return of capital through a dividend and share buybacks. We have an exciting organic pipeline, and we are very proud of our commitment to responsible mining that continues to make us a leader in sustainability. And with that, operator, I'd like to open up the line for questions.

[Operator]

Our first question comes from the line of Anita Soni with CIBC. Your line is open.

[Anita Soni, Managing Director at CIBC Capital Markets]

Good morning, Paul, everyone, and congratulations on a strong result. Can you just I just wanted to ask a couple of questions about Tasiast and the restart there. So how long was the how long was the repair? I I think you had indicated that previously it would take about three weeks, and you said it's restarted. So I just wanted to understand how many days it was.

[Claude Schimper, EVP & COO at Kinross Gold]

Morning, Anita. It's Claude. Yeah. The we did the the repairs were the total shutdown time was roughly three weeks, but we did take the opportunity to do some other work as well. So it's sort of a convoluted thing to just assign the whole three weeks to the fire incident.

[Claude Schimper, EVP & COO at Kinross Gold]

We used the opportunity to do some other work at the same time.

[Anita Soni, Managing Director at CIBC Capital Markets]

Okay. And then just another quick question on Paracatu. Grades started out pretty strong for Paracatu, but at point four three for this quarter. Just wondering, are they going to accelerate over the course of the year from that 0.43? Or is it was this a little stronger than you were looking for for this quarter?

[Claude Schimper, EVP & COO at Kinross Gold]

Again, Anita, I stress it to Barracket, too. It's pretty stable for the year. We do have ups and downs as we move different portions of the pit, but our target is the 0.43 for the rest of the year.

[Anita Soni, Managing Director at CIBC Capital Markets]

Okay. And then just a quick question on La Coipa. I think you mentioned that you were looking at extensions in the Huron pit. Can you just give us sorry, just a little bit more color on the time line on which when you think you might be able to deliver results to the market on that?

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Yeah. We I mean, our current base case or reserves that are already permitted take us through 2027 in terms of a production profile. So, obviously, we're doing the permitting work now, and we'll update the market as we submit those permits and get everything in line. But I think we'll we can provide some more detail early next year. You can see those that PID.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

It's part of our resource that's there on our resource statement.

[Anita Soni, Managing Director at CIBC Capital Markets]

Okay. And then last question on Great Bear. Can you remind me what the next key deliverables are? What permits are you waiting for at Great Bear? And have you seen any movements from provincial or federal bodies in terms of being a little bit more, I guess, amenable to accelerating some of these permits in light of sort of the macroeconomic environment that we've seen lately and Trump and sort of a refocus on resource extraction here in Canada?

[Geoffrey Gold, President at Kinross Gold]

Hi, Anita. It's Jeff Gold. I'll take the permitting question. You'll remember that there's both a provincial piece and a federal piece to our permitting. So I'll start with I'll start with our AAX program.

[Geoffrey Gold, President at Kinross Gold]

We currently have all the permits that we need for our for our current AAX activities, and we're closely working with the provincial authorities on the remaining permits, are basically water treatment permits, which we expect to get when required later in the year. On the federal side and for the main project, we continue to work with the Impact Assessment Agency of Canada, who we call IAG to advance our draft impact statement. And in terms of legislative initiatives which you also referred to, clearly there's a desire both provincially and federally to streamline the overall permitting system. Provincially new legislation has been tabled. Obviously we welcome this positive initiative to streamline permitting But it's a little bit too early to sort of comment on the impact that it would have on our overall permitting timeline until we obviously see the final legislation and accompanying regulations.

[Geoffrey Gold, President at Kinross Gold]

But again, we do see it as a potentially positive impact.

[Anita Soni, Managing Director at CIBC Capital Markets]

Okay. And this is a timeline, I think, last time we spoke with an expectation of around two years for the the permitting?

[Geoffrey Gold, President at Kinross Gold]

Yeah. That that's That's an estimate federally again, and that two years is referring to the federal review period by IAC, and that would be triggered upon filing of our impact statement.

[Anita Soni, Managing Director at CIBC Capital Markets]

Okay. Sorry. And when did you expect to file that impact statement again?

[Geoffrey Gold, President at Kinross Gold]

Yeah. We well, we've targeted we've we've targeted later in the year for that. I would start by saying our objective there remains to file a comprehensive impact statement that addresses all the key impacts upfront. And that of course will help facilitate the federal consultation process that I just referred to. Again, picking up in your comments that of course would be subject to the recent legislative initiatives that hearing about and seeing to harmonize the overall permitting process and also our ongoing engagement with the federal regulators and stakeholders.

[Anita Soni, Managing Director at CIBC Capital Markets]

Okay. Thank you. That's it for my questions.

[Operator]

Our next question comes from the line of Carey MacRury with Canaccord Genuity. Your line is open.

[Carey MacRury, Equity Research Analyst at Canaccord Genuity Group]

Good morning, guys, and congrats on the strong Maybe just a follow-up on the permitting question, maybe looking at it a different way. If permitting wasn't a gating factor or a limiting factor, and given the amount of internal work you're doing, like how early could you theoretically make a construction decision?

[J. Paul Rollinson, CEO at Kinross Gold]

Carrie, it's Paul here. Yeah. Look, I think as we've always said and as you'd expect, we're gonna do a undertake a comprehensive process. As as Jeff has indicated, there's been a lot of positive commentary in the media, both federally and provincially. But we we we haven't got enough yet to really change our course or our strategy.

[J. Paul Rollinson, CEO at Kinross Gold]

Well, you know, historically, we would have expected to be in the federal review process. There's been a lot of talk about the feds taking it back to the province. Our our objective is to be prepared for whatever, and there's nothing tangible or concrete yet, but we're we're optimistic. There might be some scheduled compression opportunities with legislation, but we haven't seen anything definitive as yet.

[Carey MacRury, Equity Research Analyst at Canaccord Genuity Group]

Okay. Fair enough. And then maybe a question for Andrea on the share buyback minimum. What sort of floor gold price would you have to hit where you don't think you would execute the $500,000,000

[Andrea Freeborough, Executive VP & CFO at Kinross Gold]

Carrie, I guess, I'll answer that by saying, as we're sitting here today, that's what we're planning for is the $500,000,000 We don't need the gold prices that we have today. And we would plan to execute that at reasonably lower gold prices, but there's been a lot of fluctuation. So as of today, we're planning for the 500, and we'll just continue to update every quarter as to how much we've done and then how we're looking at progress against the 500.

[Carey MacRury, Equity Research Analyst at Canaccord Genuity Group]

Okay, great. And maybe one for Claude as well, just on sorry, go ahead.

[J. Paul Rollinson, CEO at Kinross Gold]

No, I was just gonna add to that. Mean, the key here, Carey, as we have in the past and as we have already this year, we've demonstrated when we say we're gonna buy back that we do. So, you know, having bought 60,000,000 already since reactivating, And with the gold price where it is, we feel pretty good about this. It's obviously our intention, our objective to continue with that buyback. But we are gonna be a little cautious around the gold price.

[Carey MacRury, Equity Research Analyst at Canaccord Genuity Group]

Okay. Maybe just one last one, if I could. Just on Tasiast, circling back on Tasiast for Q2, should we be expecting similar grades and therefore proportionally see Tasiast come down by three weeks and then make it up in the back half of the year? Or how do we think about Tasiast for Q2 specifically?

[Claude Schimper, EVP & COO at Kinross Gold]

Yes. So Gary, Taylor has always had a bit of a if you compare it to last year, it had a declining profile for this year. We sort of extended the higher grade through the first quarter, which underperformed very well. As we anticipate going into the second quarter, expectations were lower. And now as I noted earlier on, we have some high grade material that gives us some flexibility.

[Claude Schimper, EVP & COO at Kinross Gold]

So the second quarter will be quite a little bit lighter. But then as we go through the rest of the year, we expect that is to meet its objectives for our 500,000,000

[Operator]

Our next question comes from the line of Ralph Profiti with Stifel.

[Ralph Profiti, Managing Director & Senior Equity Research Analyst at Stifel Financial Corp]

Thanks very much, operator. Good morning. Two questions for me. The first one, whether the additional gravity circuit infrastructure is related to the progress into the higher grade ores and the harder ores that as you deal with sort of some of those differential density factors? And what and conceivably, we into a period where we're going to see progress or acceleration into those harder higher grade ores in the second half and into 2026?

[Claude Schimper, EVP & COO at Kinross Gold]

Ralph, I'll say that the gravity circuit was a CI project which we initiated a couple of years ago. And as we went through the process of commissioning it, we've now seen improved recoveries because of it. So it was a great project for us, and it delivered very well. The different hardness of the ore relative to the different parts of the pit is just coincidental at this point. So where we are now, it is slightly harder, and our work index is a bit tougher.

[Claude Schimper, EVP & COO at Kinross Gold]

So the tonnage is slightly lower at Paracatu. But as we move into other areas, we expect to see great benefits from that gravity circuit when we get back into running the greater process, the higher tonnages.

[Ralph Profiti, Managing Director & Senior Equity Research Analyst at Stifel Financial Corp]

Got you. Okay. And maybe as a separate question for Paul and how you're thinking about sort of more of that generative exploration as we see this pivot at Great Bear into some of the more regional targets. And if you look at the exploration portfolio, there's a lot of brownfield exploration, less so on greenfield. Just wondering as a capital allocation decision, how you're thinking about sort of more of that generative work to establish more exploration targets thinking out many, many years ahead?

[J. Paul Rollinson, CEO at Kinross Gold]

Yes. No, it's a good question. I mean, historically, Ralph, and I guess philosophically, I would say, crudely, our exploration budget is probably 90% brownfields, 10% greenfields. So Mhmm. We've got a we've got geologists in both brownfields and greenfields, but our but our priority and our focus has been around mine mine x and and brownfield targets, keep going where we're already mining.

[J. Paul Rollinson, CEO at Kinross Gold]

Having said that, we've got a great team out there. We're more selective in our regions, in terms of greenfields, Canada, Nevada, Finland. We think it's important to keep the team there, and, we've got some exciting prospects. And and as well, those exploration geos are are also our our lens, if you will, into other exploration situations that are going on. As you know, we occasionally will take a minority interest in a junior explorer where we like we like the management team, the geologists.

[J. Paul Rollinson, CEO at Kinross Gold]

We like the prospectivity. So we do our own greenfields, but we also leverage some of that in house intellectual knowledge on greenfields by looking at some external JV opportunities. And that split, I think, is what we're comfortable with right now.

[Ralph Profiti, Managing Director & Senior Equity Research Analyst at Stifel Financial Corp]

Got you.

[Ralph Profiti, Managing Director & Senior Equity Research Analyst at Stifel Financial Corp]

Thanks, Paul and team.

[Operator]

There are no further questions at this time. I would like to hand the call back. My apologies. We did just have one more call work into queue. Our next question comes from the line of Tanya Jakunasek with Scotiabank.

[Operator]

Your line is open.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

Thank you, operator. Good morning, everybody. Just thank you for taking my questions. Sorry, I had to jump on the call a bit late. Maybe you've already discussed this, but I wanted to get an update if I could on Great Bear.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

Where are we with the First Nation consultations? How are those going? And when are we expecting to have agreements in place? That's my first question.

[Geoffrey Gold, President at Kinross Gold]

Thanks, Tanya. It's Jeff. I'll take that one. Yes. Look, in terms of the IBA, what we call a project agreement, we continue to advance our negotiations with our First Nations partners.

[Geoffrey Gold, President at Kinross Gold]

Obviously, negotiations remain confidential. So I can't comment on any detail, but I can tell you that the negotiations have been productive, respective and constructive. And the parties are continuing to sort of advance what you expect to see in one of those agreements, including the financial terms, procurement, training and employment and all that kind of stuff. And so we will provide sort of further updates as we get further into that.

[J. Paul Rollinson, CEO at Kinross Gold]

Yes. I think it's important to add, Jeff, that as we describe it, we sit on the traditional lands of two First Nations. That that's who we're having the discussions around the IBA with, and and those two First Nations have have been very supportive of of the project and, you know, have supported us every step of the way. So we're we're working through it, but we have, I I would say, a great relationship with the two nations whose traditional land the project resides upon.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

And and, Paul, are we expecting to have these agreement in place this year, or is that the target? Yeah.

[J. Paul Rollinson, CEO at Kinross Gold]

Look. It a bit of a I I don't know that we ideally sure, but it's gonna run its course. And, you know, it's it's we're not here to rush. It doesn't hold up our timeline. When Jeff talked about the impact statement that we will file, which starts the clock with the federal review, and that's assuming we are in a federal review.

[J. Paul Rollinson, CEO at Kinross Gold]

We may not be, depending upon what happens at the federal provincial level. But the timing of filing that impact statement, we are the proponent, Jeff, and we control the timing.

[Geoffrey Gold, President at Kinross Gold]

That's exactly right. As a project proponent, we control the timing of the filing of the impact statement. And just to say it, we don't expect our IBA negotiations to negatively impact our overall May and project timeline, Tanya, as Paul said.

[J. Paul Rollinson, CEO at Kinross Gold]

But we don't need the IBA to file the impact statement as the point.

[Claude Schimper, EVP & COO at Kinross Gold]

No, we don't.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

Okay. Okay. Thank you for that. And then maybe just quickly, I'm just looking at your slide 19, and I'm just looking at it from two perspectives. One of it is just oh, thank you for the slide, by the way.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

One of it is just looking at what your optionality is and all of those Lobo Marque, which, you know, I think could be something that could come in in twenty, thirtieth time frame. And I think it was about 300,000 ounces in production. So what I'm trying to really think about is the optionality. Can we just review when some of these things could come in and what they could add? Obviously, Great Bear, I know.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

But Maracunga, Lobo Market, Kurlu. And then within today, 02/1930, some of the current operation, the extensions that you're looking at, what else could they do in terms of supplementing your 2,000,000 ounce production profile from now until for the next three years?

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Yes. As you can see on the slide, we've kind of tried to split it into what has the near term impact and what's more 02/1930 and thereafter. As you noted, we see Lobo Marte as more kind of after 02/1930, and part of that is because we have continued resources at La Coipa that are going to take us out into 02/1930 and maybe into 02/1931, '2 thousand '30 '2. So it's somewhere in that range for Lobo. For the other projects that you referred to, Kerlu is one where, given the nature that this is really a restart and it's using an existing mill facility, we think that's something that could come back online in and around 2028 if everything goes well.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

And then same thing on Phase X. It's probably a similar time line for getting that underground going. So those are two things that are kind of later end of this decade that can bring in some impact. You can see a lot of the other optionality. The page is really just continued extensions through our M and I resources at our existing sites, and that also can contribute through the end of the decade.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

A great example of that, we released more info last quarter on Bald Mountain on the open pit extensions there. And Redbird two, we have noted we're going to hopefully bring that into the portfolio soon or into the pipeline and make an approval decision. And that takes us out to 02/1931 and would really start contributing in 2028. So those are the key ones for that time period. Obviously, Grave Bears, you guys have lots of information on that, and that's a key contributor at the end of the decade.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

I just

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

wanted to

[J. Paul Rollinson, CEO at Kinross Gold]

add a couple

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

Go ahead.

[J. Paul Rollinson, CEO at Kinross Gold]

Yes. No, I was just going to make a couple of other additional points again. Also on that Slide 19, just the bottom line there, think also underpins the optionality with the fact that we've got about 26,000,000 ounces in M and I beyond the 2P and another $13,000,000 incrementally in inferred above that, which, again, we're running our resources at $2,000 The other point I was gonna make just to supplement what what Will was saying, the other point to keep in mind is we've generally been in pursuing what we've been calling a bit of a grade enhancement strategy. And so for me, what's exciting is is as we're going to move into phase x, that's where we're gonna get into that bulk hundred gram, three to four gram, which, again, will be blending with a lower open pit. Just like we're doing with Mancho today, we've got a, you know, a high grade supplement to a low grade pit.

[J. Paul Rollinson, CEO at Kinross Gold]

Kurlu, again, we still got lots of work to do. But looking at the widths and grades, we're feeling like, you know, again, we've got a small but higher grade opportunity to bring grade into the into the before the end of the decade profile. And then as you and and those, to me, in my mind, are sort of the 28 kinda potential contributors. Beyond that, as you say, Great Bear starts to come into view and Lobo comes into view. And, Will, I mean, we haven't said a lot about Lobo, but, you know, it it's definitely a low strip, decent grade, 1.3 gram.

[J. Paul Rollinson, CEO at Kinross Gold]

I think, you know, we're gonna refresh our our thinking, but I I you know, 300,000 maybe life of mine average, but I think you'll see years where we do much better than that and maybe closer to 400. And, look, again, we've got an inflation adjust and think about that towards the end of the decade. But say it's not as great as great there, but I still think we're gonna have a pretty attractive ASIC there. So again, another great margin improvement as we move out towards the end of the decade.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Yeah. And I think the key there, as you mentioned, was Lobo. It's a low strip, it's also it's 1.3 gram grade, but that's all going through a heap leach. So it's a high margin operation. It's a quality project.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

Okay. And if I can remember correctly, Kearluk would be plus 100,000 ounces. Would that be a fair assumption?

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

It's in around that range, yes. Yes. Again, it's that smaller scale but really good grades. As you've seen, it continues to tick up every time we do a resource update, and that's really what our exploration team is focused on, that higher grade, higher margin material.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

Okay. Thank you. And then just my last question, if I could. Sorry. If I could get one more in.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

I just and I'm sorry I missed this. But I think, Claude, I just came in when you were talking about some of the quarterly production profiles that Tasiast is a bit lower in Q2 and then sort of picking up in Q3, Q4. I think Paracatu is supposed to be evenly distributed. I think last quarter you mentioned that you have no major maintenance downtime in any of the operations. So the profile for the year should be evenly distributed quarterly.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

Would that still be a fair way to think about it?

[Claude Schimper, EVP & COO at Kinross Gold]

Yes. I would say it's a fair way to think about it with the caveat that we have exceeded our expectations in Q1. So the rest of the year is pretty evenly distributed, and we're still targeting that guidance number of $2,000,000 But we're slightly ahead of the pace in Q1, and we're going to keep our operational excellence focus for the rest of the year.

[Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank]

Okay. With just the movement, the three week downtime at Tasiast.

[Operator]

Our next question comes from the line of Josh Wolfson with RBC Capital Markets. Your line is open.

[Josh Wolfson, Director, Head of Global Mining Research at RBC Capital Markets]

Thanks very much. Back to the Great Bear permitting questions. For the decision to, I guess, reallocate resources from drilling at the LP faults to some of the surface targets, I'm just wondering, is any of the drilling for some of the AEX program infill related? And is there any element of that, that would be, I guess, path? And I'm just wondering, bigger picture here, when would we expect the drilling there to resume?

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Yes. AX drilling is infill drilling. That's the point of getting underground. That's one key piece of it. You get underground to convert from your inferred up to your indicated spacing.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

We're also going to do exploration from underground, particularly Hinge and Limb as a target that we're going get a lot closer to and get more infill on. So that should be interesting given that was not in the PEA that we put out there. We see a lot of opportunity there. But the move away, as we've tried to outline in the materials, from doing that exploration right now, it's really just a financial decision. These are very deep holes.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

It does not make sense to do a lot more infill and continue trying to expand that resource from surface. So we get underground. In terms of your critical path question, we're very far ahead of the critical path in terms of when we get underground versus when we have to start mining because it is the permitting that's more of the critical path and the construction of the asset. So we've got lots of time to get underground and do that drilling from underground and be in a position to start mining. And we've done a lot of work at surface with infill drilling and RC drilling to confirm our understanding of how we convert from inferred to indicated.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

So we've got a good understanding of the ore body. It's not a critical path to get that drilling into the ADX, and it is the right way and a more efficient way to do the infill. Yes. And the other thing, we are doing a bit of work on as we step out is just condemnation drilling for the major infrastructure just to be 100% sure, given the nature of this deposit and the high grade, we don't put any facility in the wrong place. That's the only other kind of exploration and drilling work we're doing this year.

[Josh Wolfson, Director, Head of Global Mining Research at RBC Capital Markets]

Got it. Thanks. Then just one more question. Looking at the current high gold price environment, it sounds like at least in prior quarters, the opportunity to look at a higher sort of pricing assumption has enabled some of ability to leverage upside at Bald Mountain with Phase two, the Red Bird pit. Are there any other opportunities the company is sort of thinking about over the next couple of years that maybe make more sense in today's environment?

[Josh Wolfson, Director, Head of Global Mining Research at RBC Capital Markets]

Thank you.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

Yes. I think the slide we've gone over for Tanja earlier, Slide 19, is a good one. It really just illustrates the nature of Kinross, frankly, and all of our assets. They continue at depth. That's why we've got such a large M and I resource.

[William Dunford, Senior Vice-President of Technical Services at Kinross Gold]

And the gold price always helps when you're going to the next layback, the next pushback. So things like CASIUS that we spoke about a bit, where we're looking at that next layback, a higher gold price environment is very beneficial. The one thing we've communicated and we've been quite strict on as a company is we're we don't want to start dropping cutoff grades today because our milling facilities are full with this higher margin material. But long term, there does with that higher gold price, there's stockpile optionality on material that otherwise would have been waste that we're mining through anyways that we get the benefit of at the end of life of mine. And the gold price helps significantly with each of these next pushbacks at our assets.

[Operator]

There are no further questions at this time. I would like to hand the call back over to Paul Rollinson, CEO, for closing remarks.

[J. Paul Rollinson, CEO at Kinross Gold]

Thank you, operator, and thanks, everyone, for joining us this morning. We look forward to catching up with you in person in the coming weeks. Thank you, everyone.

[Operator]

This concludes today's conference call. You may now disconnect.

Participants

Executives

• David Shaver, Senior Vice President of Corporate Development
• J. Paul Rollinson, CEO
• Andrea Freeborough, Executive VP & CFO
• Claude Schimper, EVP & COO
• William Dunford, Senior Vice-President of Technical Services
• Geoffrey Gold, President

Analysts

• Anita Soni, Managing Director at CIBC Capital Markets
• Carey MacRury, Equity Research Analyst at Canaccord Genuity Group
• Ralph Profiti, Managing Director & Senior Equity Research Analyst at Stifel Financial Corp
• Tanya Jakusconek, Director specializing in Gold & Precious Minerals at Scotiabank
• Josh Wolfson, Director, Head of Global Mining Research at RBC Capital Markets