Worker missing after Kumtor slide

One Kyrgyz national employee is missing and presumed dead after a pit wall failure at the Kumtor gold mine in Kyrgyzstan.

Cameco (CCO-T), which has a one-third interest in the mine, reports that the incident on July 8 involved a 200-metre-high section of the pit wall.

Cameco says that operations have been halted, the employee’s family has been notified and a rescue team continues to search.

The Kumtor Operating Co. (KOC), Cameco’s subsidiary that operates the mine, intends to co-operate fully with an investigation to be carried out by the Kyrgyz Ministry of Environment and Emergencies.

The company set no timetable for a resumption of production.

The government of Kyrgyzstan owns a two-thirds stake in the mine, which situated in the interior of the Tien Shan mountain range adjacent to China. vStaffed by about 1,500 people, Kumtor’s production fell 18% during the first three months of 2002, thanks to a fall in head grade to 4.2 grams gold per tonne from 5.1 grams last year. As a result cash costs jumped US$39 to US$166 per oz. gold.

Cameco’s share of production fell to 51,566 oz. gold during the quarter, but the partners have raised their production estimate for 2002 from a more bearish estimate of 660,000 oz. gold to 700,000 oz. By comparison, the mine churned out 753,000 oz. gold in 2001.

At the end of March, Kumtor’s hedge book covered 1.1 million ounces at an average of about US$300 per oz. going forward.