CORRECTED-Kinross continues processing at strike-hit Mauritania gold mine

Tue May 24, 2016 1:14pm EDT
 
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(Changes to Tuesday in paragraph 3)

May 24 (Reuters) - The processing facility remains in operation at Kinross Gold Corp's Tasiast mine in Mauritania, a spokesman for the miner said on Tuesday after workers at the site went on strike.

Management at the mine in western North Africa also have a contingency plan to minimize the impacts of the strike, which includes processing stockpiled material, Kinross spokesman Louie Diaz said in an email. He did not give details of the plan.

Kinross said that unionized workers at the Tasiast mine had gone on strike on Tuesday. The Toronto-headquartered gold miner said it did not expect the strike to affect an expansion that is currently planned for the mine.

Kinross in March approved a $300 million first-phase expansion to double Tasiast's production and slash its production costs.

Its shares were down 8 percent at C$5.95 on the Toronto Stock Exchange, falling more than the S&P/Global Gold Index , which was 5 percent lower on a weaker gold price.

Tasiast is one of Kinross' highest cost mines and does not contribute significant cash flow to the company at this stage, RBC Capital Markets analyst Stephen Walker said in a note to clients.

BMO Capital Markets analyst Andrew Kaip estimated that a one-month strike could impact 2016 earnings per share by less than 2 percent. (Reporting by Nicole Mordant in Vancouver; Editing by Marguerita Choy)