Soaring costs have forced Kinross Gold (K-T) to suspend operations at its Lupin mine in Nunavut, 400 km northeast of Yellowknife.
The move comes despite a restructuring plan in May, which improved costs. Still, Kinross says that the stronger Canadian has more than offset those savings.
Some 235 employees plus another 70 contract workers will be laid off. A small group will remain on site to review alternatives for the project. One plan is to mine the shaft and crown pillars, which are estimated to contain around 400,000 tonnes grading 8.5 grams gold per tonne.
Lupin’s plant and equipment will be placed on care and maintenance pending the results of the review. The remaining skeleton crew will also continue the mine’s environmental management.
Kinross inherited Lupin earlier this year via its combination with Echo Bay Mines (part of a 3-way merger also including TVX Gold). The mine churned out 25,534 oz. gold at a total cash cost of US$409 per oz. during the second quarter. In all of 2002, Lupin produced 113,835 oz. gold at US$330 apiece, and in 2001 it cranked out 139,327 oz. at US$246 per oz.
At the end of 2002, reserves stood at 1.2 million tonnes grading 8.57 grams gold.
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