Kinross Gold, after making plans to suspend its operations in Russia at the start of the month, is now in exclusive negotiations with a third-party mining company regarding a potential sale of 100% of its assets in the country.
On March 2, the company said it was making plans to suspend its Russian operations following Russia’s ongoing military offensive in Ukraine. Both its Udinsk development project and Kupol mine (pictured) were part of this plan, which, while considering suspension, would focus on the safety and well-being of its more than 2,000 employees in addition to its obligations to manage and mitigate the mine’s environmental impact on an ongoing basis, it said.
Subject to this disclosure, the company has been developing a transition plan to divest its Russian assets.
Kinross said on March 29 it had received a number of unsolicited proposals regarding its Russian business and was now in exclusive negotiations with a third-party mining company regarding a potential sale of 100% of its assets in the country. Any such divesture or change of control would be subject to Russian government approval, it noted.
As part of the exclusivity agreement and to properly maintain assets pending a change of control, the company’s Russian subsidiaries are continuing to operate during the transition period. Kinross will also continue to manage and mitigate the environmental impacts of its operations. This includes overseeing monitoring systems and transporting industrial materials to the Kupol mine that are not permitted to remain at the port to maintain safety and regulatory compliance.
“Kinross will continue to prioritise the well-being of its more than 2,000 employees in the country as it develops its transition plan,” it said.
The parent company will not benefit financially from the operations while the transition plan is finalised, Kinross clarified, with current activities funded through resources already in-country, with no additional investment required by the parent company.
Kinross expects to treat its Russian business as an asset held for sale from an accounting perspective until a change of control is completed.