Kinross Gold Corp. announced an agreement with N-Mining Ltd. to acquire Chulbatkan, a high-quality, heap-leach development project in Russia, for total fixed consideration of $283 million, including approximately $113 million in cash and approximately $170 million in Kinross shares. In addition, N-Mining will have the right to economic participation equivalent to a 1.5% net smelter return (NSR) payment and contingent consideration linked to future reserve additions.

The project has estimated indicated resource of approximately 3.9 million ounces (oz) of gold and estimated inferred resource of 80,000 oz of gold. There are also exploration and mining licenses in place until the end of 2037.

“Chulbatkan is an exciting high-quality development project with significant upside potential and low relative execution risk located in a country where we have had extensive experience and success, and maintain a strategic and competitive operating advantage,” said President and CEO J. Paul Rollinson. “This acquisition is an excellent fit for Kinross as it enables us to leverage our expertise as a world-class cold-climate heap-leach operator.”

According to Rollinson, the project has the potential to be a low-cost, low-strip, high-return operation.

“It is an excellent complement to our existing operations at Kupol and Dvoinoye, both of which remain prospective in their own right,” he added.

The company said it will conduct a comprehensive exploration program, complete pre-feasibility and feasibility studies within the next three years, and target a two-year construction period.