Filed by Kinross Gold Corporation
pursuant to Rule 425 under the Securities Act of
1933 and deemed filed pursuant to Rule 14d-2
of the Securities Act of 1934
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Subject company: Crown Resources Corporation
Commission file No. 000-17480
CROWN RESOURCES COMPLETES FEASIBILITY STUDY ON ITS HIGH-GRADE BUCKHORN MOUNTAIN
GOLD PROJECT
DENVER--(BUSINESS WIRE)--Dec. 16, 2003--Crown Resources Corporation (OTCBB: CRCE
- News; "Crown") reported today it has completed a feasibility study on its
Buckhorn Mountain Gold Project prepared by SRK Consultants, Toronto, ON, Canada
("SRK"), an independent mining and engineering consulting firm.
The SRK feasibility study (the "Study") determined that the mineral reserves
reported are economically viable based on current information on costs and
technology applicable to mining, metallurgy and other relevant factors that
relate to the extraction of the mineral reserve. The Buckhorn Mountain Gold
Project (formerly named Crown Jewel) is located in north-central Washington
State.
Feasibility Study Summary on the Buckhorn Mountain Gold Project
Reserves: Probable
Tons Grade (Oz/ton) Contained Ounces Gold
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3,075,600 0.32 991,300
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Assumptions: Toll Milling (see below for details): $20 per ton
Gold Price: $350
Recovery: 90%
Cutoff Grade (oz./ton): 0.19
Production/Costs: Daily Throughput: 1,500 tons
Total Operating Costs: $201 per ounce of gold recovered
Initial Capital Costs: $32 million
Sustaining Capital (Life of Mine): $10 million
QUALITY ASSURANCE
The SRK Study was based on reviews by independent consultants of existing
project files and studies prepared for or by Crown. The mineral reserves
reported in the SRK feasibility study have been verified by Mike Michaud, a
Mineral Economist representing SRK. Mr. Michaud is a "qualified person" within
the meaning of applicable Canadian securities regulatory standards. He has
verified the reserve data disclosed herein, including any relevant sampling,
analytical and test data. SRK provided site-specific geotechnical evaluations.
Greystone Engineering Ltd., an independent mining consultant firm, provided the
detailed mine design, surface infrastructure, and capital and operating cost
estimates utilized in the Study. Process Resource Associates, an independent
metallurgical consulting company, provided the metallurgical process evaluation.
SRK reviewed all aspects of the different components utilized in the Study and
was responsible for the Study's final compilation.
KINROSS TRANSACTION
On November 20, 2003, Crown reported that it had signed a definitive acquisition
agreement (the "Agreement") with Kinross Gold Corporation (TSX:K - ; NYSE:KGC -
NEWS; "Kinross"). Under the terms of the Agreement, shareholders of Crown will
receive 0.2911 shares of Kinross for each share of Crown. Prior to the
completion of the acquisition, Crown plans to dividend to its shareholders its
approximate 38.7% equity interest in Solitario Resources Corporation (TSX:SLR -
NEWS).
TOLL MILLING AGREEMENT
On November 11, 2003, Crown entered into a toll milling agreement (the "Toll
Milling Agreement") with Echo Bay Minerals Co. ("Echo Bay"), a wholly-owned
subsidiary of Kinross, whereby Crown would deliver ore from its Buckhorn
Mountain Project deposit to Echo Bay's Kettle River mill, located near Republic,
Washington, approximately 92 kilometers (57 miles) from the Buckhorn Mountain
Project. Under the terms of the Toll Milling Agreement, Echo Bay agreed to
process up to 1,500 tons per day of ore at a rate of $20 per ton. In addition
Crown agreed to pay a one-time capital charge of $5 million to Echo Bay upon
delivery of production ores to the Kettle River Mill. Using similar assumptions
to those in the feasibility study, Crown estimates that total cash operating
costs under Kinross ownership would be lowered by approximately $25 per ounce as
the toll milling costs would be reduced to actual Kettle River milling costs.
Additionally, initial capital would be reduced by $5 million, to $27 million,
under Kinross ownership.
Crown is actively engaged in permitting and development of the Buckhorn Mountain
gold project. Crown also owns a 38.7% equity interest in Solitario Resources
Corporation. Solitario is actively exploring in Brazil, Peru and Bolivia for
gold, silver, zinc and platinum-palladium mineralization. Crown Resources
Corporation is traded on the Nasdaq Bulletin Board (OTCBB:CRCE - NEWS) and
Solitario is traded on the Toronto Stock Exchange (TSX:SLR - NEWS).
This press release includes certain "Forward-Looking Statements" within the
meaning of section 21E of the United States Securities Exchange Act of 1934, as
amended. All statements, other than statements of historical fact, included
herein, including without limitation, statements regarding potential
mineralization and reserves, exploration results and future plans and objectives
of Kinross and Crown, are forward-looking statements that involve various risks
and uncertainties. There can be no assurance that such statements will prove to
be accurate and actual results and future events could differ materially from
those anticipated in such statements. Development of Buckhorn Mountain is
subject to the successful completion and implementation of an economically
viable mining plan, obtaining the necessary permits and approvals from various
regulatory authorities, and compliance with operating parameters established by
such authorities. Important factors that could cause actual results to differ
materially from Kinross' and Crown's expectations are disclosed under the
heading "Risk Factors" and elsewhere in Kinross' and Crown's documents filed
from time to time with the Toronto Stock Exchange, the United States Securities
and Exchange Commission and other regulatory agencies.
WHERE TO FIND ADDITIONAL INFORMATION ABOUT THE CROWN/KINROSSTRANSACTION:
This press release is not, and is not intended to be, a solicitation of proxies
or an offer of securities. Kinross intends to file with the Securities and
Exchange Commission ("SEC") a registration statement that will include a proxy
statement on behalf of Crown and a prospectus on behalf of Kinross, and other
relevant documents in connection with the proposed acquisition. Investors and
security holders of Kinross and Crown are urged to read the proxy
statement/prospectus and other relevant materials, when they become available,
as they will contain important information about Kinross, Crown and the proposed
acquisition. When filed, the proxy statement/prospectus and other relevant
materials, and any other documents filed by Kinross or Crown with the SEC, may
be obtained free of charge at the SEC's website at WWW.SEC.GOV. A free copy of
the joint proxy statement/prospectus and other relevant materials may also be
obtained from Kinross when available.
Crown and its officers and directors may be deemed to be participants in the
solicitation of proxies from its stockholders with respect to the transactions
contemplated by the proposed acquisition. A description of the interests of the
directors and executive officers of Crown will be contained in the definitive
proxy statement/ prospectus and the other relevant documents filed with the SEC.
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CONTACT:
Crown Resources Corporation
Debbie W. Mino, 800-229-6827
dwmino@compassnet.com
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http://www.crownresources.com
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or
Christopher E. Herald, 303-534-1030