Kinross Gold to sell Ecuador gold project after clashes with the govt.

Posted on October 22, 2014 • Filed under: Ecuador, Latin America Mining reported Kinross Gold Corp. has agreed to sell its mothballed gold project in Ecuador for $240-million (U.S.) to Fortress Minerals Corp., a company controlled by the Lundin family.

The sale of Fruta del Norte is a relief for the beleaguered Kinross, which was forced to write down the asset after clashing with the Ecuadorean government on its economic terms. Toronto-based Kinross once saw Fruta del Norte as key to its growth. But after two years of negotiations with the South American government, the gold miner said it was not going to waste any more capital. It recorded a $720-million charge and slashed its reserves by 10 per cent to reflect the loss.

The $240-million in cash and stock from the Lundin family is a fraction of the $1.2-billion Kinross paid for Aurelian Resources, the owner of the gold deposit. But analysts have said any sale was positive for Kinross. Read Article

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