UPDATE 1-Kinross cuts capital costs for Tasiast gold mine expansion
(Adds CEO quotes, study results)
TORONTO, March 31 (Reuters) - Kinross Gold Corp released a feasibility study for its Tasiast gold mine expansion on Monday with a much lower estimated capital cost than previously, but said it does not plan to make a final decision on the project until 2015 at the earliest.
The Canadian gold miner said the initial capital cost to expand the mine in Mauritania would be $1.6 billion, compared with its pre-feasibility estimate of $2.7 billion.
"What this study has shown us is that we really have an opportunity, if we do proceed with a mill expansion, to turn Tasiast into a world-class asset," said Chief Executive Officer Paul Rollinson in an interview.
"It would go from a smallish, high-cost producer to one of our largest, lowest-cost producers."
Rollinson said the pre-feasibility study released last year had been largely about determining the best mill size. With that settled, the feasibility study focused on economics.
The study assumes a 38,000 tonne-per-day mill, and a gold price of $1,350 per ounce. It sees average production of 848,000 ounces per year in the first five years, at cash costs of $501 an ounce. Tasiast produced 247,818 ounces of gold in 2013.
The pre-feasibility study, based on a 30,000 tonne-per-day mill, had seen 830,000 ounces a year of production with cash costs of about $500 an ounce in the first five years.
The mine would operate until 2029, not 2033 as the pre-feasibility had found.
Kinross said the expansion could boost Mauritania's gross domestic product, contributing an additional $600 million to the government in taxes and royalties over the life of the mine. (Reporting by Allison Martell. Editing by Andre Grenon and Lisa Shumaker)