The Peak Gold project is located nearly 400km southeast of Kinross’ Fort Knox mine
Kinross Gold has signed agreements with Royal Gold and Contango ORE to acquire 70% stake in the Peak Gold project in Alaska, for $93.7m in cash.
Under the terms of the agreement, Canada-based gold and silver mining firm Kinross will get the authority to build and operate the Peak Gold project.
By acquiring Royal Alaska from Royal Gold for $49.2m in cash, Kinross will acquire 40% stake in the project. It will buy the remaining 30% stake from CORE Alaska for total of $44.5m.
Kinross Gold president and CEO J Paul Rollinson said: “The relatively high-grade, low-cost Peak Gold project is an excellent addition to our portfolio, as it allows us to leverage our existing mill and infrastructure at Fort Knox and strengthens our medium-term production and cash flow profile.
“In today’s gold price environment, Peak Gold is an attractive, high-margin project that is expected to generate robust returns. The project is also expected to add to our strong record of socio-economic contributions to our host communities in Alaska, one of the top mining jurisdictions in the world.”
Kinross to process the Peak Gold ore at Fort Knox
Located near Tok, Alaska, the Peak Gold project is a high-grade deposit that is around 400km southeast of Kinross’ Fort Knox mine.
The project is situated in an area spanning 2,732km2 mineral lease with the Village of Tetlin and is a high-grade skarn deposit that extends to surface.
It is expected to start production in 2024 as a low-cost, open-pit mine, with a mine life of 4.5 years.
Kinross intends to process the Peak Gold ore at Fort Knox and leverage the existing mill and infrastructure to benefit both the project and the mine.
Village of Tetlin Chief Michael Sam said: “We look forward to the safe and responsible development of the project and the positive benefits it is expected to generate for our community.
“We also look forward to further building a relationship with Kinross, a company with a strong track record in Alaska, and are pleased to see further investment plans for the project.”