Basic Operating and Financial Results
At the Kumtor mine gold production in 2014 was 567,693 ounces* or 17,657 kg. Gold sales in 2014 were 561,154 ounces or 17,454 kg with a revenue totaling $694.6 million**. The table below displays Kumtor’s basic operating and financial results:
Three Months Ended December 31
Year Ended December 31
|Revenue from gold sales to Kyrgyzaltyn – $ millions**||346.2||448.9||(23%)||694.6||810.9||(14%)|
|Cost of sales*** – $millions||171.5||255.1||(33%)||444.5||473.0||(6%)|
|Cost of sales*** – $/oz||594||722||(18%)||792||786||1%|
|Tonnes mined – 000s||42,786||46,866||(9%)||191,723||176,693||9%|
|Tonnes ore mined – 000s||6,615||4,194||58%||8,640||7,289||19%|
|Tonnes milled – 000s||1,502||1,460||3%||5,840||5,596||4%|
|Average mill head grade – g/t||7.40||8.88||(17%)||3.90||4.26||(9%)|
|Recovery – %||82.2||84.1||(2%)||78.0||79.3||(2%)|
|Gold produced – ounces*||291,635||348,130||(16%)||567,693||600,402||(5%)|
|Gold produced – kg||9,071||10,828||(16%)||18 674,6||18,675||(5%)|
|Gold sold – ounces*||288,851||353,252||(18%)||561,154||601,887||(7%)|
|Gold sold – kg||8,984||10,987||(18%)||17,454||18,721||(7%)|
|Average realized gold price*** – $/oz||1,198||1,271||(6%)||1,238||1,347||(8%)|
|Adjusted operating costs*** – $/oz||244||217||12%||356||357||0%|
|All-in sustaining costs*** – $/oz||378||388||(3%)||779||775||1%|
|All-in costs*** – $/oz||418||407||3%||851||853||0%|
|All-in costs including taxes*** – $/oz||585||585||0%||1,024||1,042||(2%)|
|Capital expenditures (sustaining)*** – $millions||13.4||9.6||40%||48.7||49.7||(2%)|
|Capital expenditures (growth)*** – $millions||11.5||5.8||98%||40.1||39.2||(2%)|
|Capital expenditures (stripping)*** – $millions||32.5||70.8||(54%)||261.1||278.6||(2%)|
(*) One Troy ounce equals to 31.10348 grammes.
(**) Unless specified otherwise, all dollar figures in this news release are in US dollars.
(***) Adjusted operating costs, all-in sustaining costs, all-in costs and all-in costs – including taxes (in $ per ounce sold), as well as average realized gold price per ounce sold, cost of sales per ounce sold and capital expenditures (sustaining and growth) are non-GAAP measures and are discussed under “Non-GAAP Measures in Centerra’s news release and MD&A dated February 19, 2015”.
Payments to the Kyrgyz National Budget and Mandatory Contributions
During the twelve months of 2014, contributions to the national budget in taxes, deductions to the Social Fund and other mandatory payments exceeded $120 million, which according to the KR National Bank’s exchange rate as at December 31, 2014, amounts to approximately 7.075 billion soms.
|Issyk-Kul Development Fund||7,384.25|
|Employee Income tax||4,774.74|
|Social Insurance Fund||19,869.53|
|Tax on nonresident companies||589.22|
|Other taxes and mandatory payments||121.26|
|US$ official exchange rate to the Kyrgyz Soms as of December 31, 2014||58.8865|
|Equivalent of payments effected in million Kyrgyz Soms||7,075,083.91|
Note: Under the Agreement on New Terms dated as of April 24, 2009, the revenue-based tax and contributions to the Issyk-Kul Region Development Fund are estimated based on actual cash revenues from sales during the period under review.
Payments within the Kyrgyz Republic
Contributions made within the Kyrgyz Republic in 2014 (including taxes, refining, domestic suppliers, infrastructure, charities, etc.) have exceeded $283 million.
In all, contributions made within the Kyrgyz Republic between 1994 and 2014 have exceeded $2.707 billion.
1994 – 2014
|Taxes, customs & other mandatory payments||92.590||799.918|
|Social Insurance Fund||19.870||132.840|
|Issyk-Kul Development Fund||7.384||42.896|
|Licenses & permits||0.208||2.787|
|Pollution tax and payments to the Environment Protection Agency||0.310||4.369|
|Payments to Kyrgyzaltyn||0.384||12.059|
|Revenue from the sale of Centerra shares||–||86.000|
|Purchases in the Kyrgyz Republic:
– supplies & services
|– roads outside the mine site||1.763||39.281|
|– Tamga-Kumtor power-transmission line||–||41.612|
|KOC employees’ net wage||65.919||513.928|
|Education, scholarships & training||0.738||4.649|
|Sponsorships & sustainable development projects||4.482||25.408|
|Payments to communities||–||4.400|
Kumtor’s Impact on the Macroeconomic Performance of the Kyrgyz Republic
According to preliminary reports of the KR National Statistics Committee,
– Kumtor’s share in KR GDP in 2014 was 7.4 %;
– Kumtor’s share in the aggregate industrial output was 23.1 %.
Daniel Desjardins, President of Kumtor Gold Company, commented on the results in 2014 as follows: «I am pleased to report that the operation met its annual production guidance for 2014. During the fourth quarter, the Company produced 291,635 ounces of gold as we accessed the high-grade SB Zone, which we are continuing to mine in the first quarter of 2015.
At Kumtor this year, we are expecting relatively even quarterly gold production as compared to prior years when the majority of the ounces were produced in the fourth quarter. The Kumtor mine is expected to produce between 470,000 and 520,000 ounces of gold, or 14.6 and 16.2 tonnes of gold in 2015.»
At Kumtor, 2015 total capital expenditures, excluding capitalized stripping, are forecast to be $75 million. Spending on sustaining capital of $49 million relates primarily to the major overhaul maintenance of the heavy duty mine equipment ($36 million), construction to raise the tailings dam ($7 million) and other items ($6 million).
Growth capital investment at Kumtor for 2015 is forecast at $26 million and includes the relocation of certain infrastructure at Kumtor related to the KS-13 life-of-mine expansion plan and dewatering projects.
The projected cash component of capitalized stripping costs related to the development of the open pit is expected to be $185 million of the $234 million total capitalized stripping forecast in 2015.
The Kumtor open pit mine, located in the Kyrgyz Republic, is the largest gold mine in Central Asia operated by a Western-based producer. It has been in operation since May 1997 and, as of December 31, 2014, has produced approximately 9.9 million ounces or 307.9 tonnes of gold.
Kumtor Gold Company is the operator of the Kumtor project responsible for the entire production cycle.
Centerra Gold Inc. (Centerra) is a gold mining company focused on operating, developing, exploring and acquiring gold properties in Asia, Canada and other markets worldwide. Centerra is a leading North American-based gold producer and is the largest Western-based gold producer in Central Asia. Centerra’s common shares trade on the Toronto Stock Exchange (TSX) under the symbol CG. The Company is headquartered in Toronto, Ontario, Canada.
Additional information on Centerra and the full text of the news release on the 4th quarter and basic operating results of 2013 are available on SEDAR at www.sedar.com and www.centerragold.com. Information on KGC is available at www.kumtor.kg