Canada-based Kinross Gold has announced that it will not continue with the further development of the $1.3bn gold project in Ecuador, after it failed to reach an agreement with the government on the development of the mine.

For more than two years, Kinross has been in talks with the government on the exploitation and investment protection agreements for the Fruta del Norte (FDN) project.

Kinross said that the both parties were unable agree on few key economic and legal terms which balance the interests of all stakeholders.

The company requested the government for its cooperation in ensuring an orderly transition that respects the interests of both parties.

Kinross said it plans to focus on assisting its employees and local shareholders during a transition period as it intends to reduce its level of activities in Ecuador over the coming months.