Compliance

Kinross’ activities are subject to a large number of environmental laws and regulations with a complex variety of permit conditions, standing environmental regulations, and reporting deadlines in each of the jurisdictions where we operate.

Compliance with these requirements is our first priority when it comes to protecting the environment where we work. To manage this, each site maintains a compliance register that contains all specific requirements and assigns responsibilities for all tasks required to maintain compliance with those requirements. Each site’s compliance record is included in the CRPM and directly affects its annual performance evaluation.

During the reporting period, we updated and strengthened our standards and guidance surrounding our compliance management system including obligation registries. Internal reviews at each site assessed their level of alignment with corporate standards. In some cases, these reviews identified gaps that were voluntarily reported to authorities To learn more, see information on Maricunga Notice of Violation. In addition to our internal reviews, in 2013 we undertook an independent assessment of compliance registry status across the Company. These reviews have supported site efforts to put in place robust compliance management systems. Compliance training was rolled out across the sites in 2011 and 2012, and a new compliance indicator was implemented at the beginning of 2013. Beginning in 2013, sites are required to integrate compliance training into orientation training for new hires.

During 2012 and 2013, Kinross received a total of 10 Notices of Violation (NOVs) and associated fines totalling $379,000, including the settlement amount pertaining to Kettle River-Buckhorn.

Spills and Releases

All Kinross operations are designed and operated to minimize the potential consequences associated with accidental chemical spills and unplanned releases of untreated water.

Our operations are designed with secondary containments with sufficient storage capacity to prevent the release of accidental spillage or unplanned releases associated with storm events. To ensure that adequate secondary containment is available should an upset or incident occur, all mines are required to maintain accurate, up-to-date, predictive water balance models. Should an incident occur, emergency plans are in place to enable our operations to respond quickly and effectively to protect personnel and the environment, reduce the size and potential consequences of the incident, and promptly clean up and remediate the area. We have established mutual aid alliances with local and regional emergency response services to provide valuable ongoing experience and training for our emergency personnel to improve our ability to respond to chemical transport incidents outside our sites.

In 2012 and 2013, Kinross operations had a total of 11 major releases, a decrease in the number of spills from 17 spills which occurred during the prior 2010-2011 reporting period. All releases were contained on our mining sites, except for one spill that occurred in 2012 when a diesel tanker overturned during transit to Kupol and that resulted in a $13,000 fine. All spills were promptly remediated and resulted in no significant environmental effects.

Maricunga Notice of Violation

In 2012 our Maricunga mine undertook a compliance review that identified some potential gaps in compliance with the numerous permits and approvals issued since the mine’s inception in 1997. We informed the authorities and took immediate action wherever possible to rectify the gaps; in December 2012, we submitted a permit amendment that would formalize the issues that could not be addressed by immediate action. The Superintendencia del Medio Ambiente (SMA), the newly formed national environmental agency, conducted a site visit and asked for additional information, which we provided.

In September 2013, the SMA issued a Notice of Violation (NOV) relating to certain violations that had previously been identified to the authorities by the Company. Many of these related to temporary conditions (e.g. conveyor covers); others related to operational decisions (e.g. there was no specific date required to close the heap leach pads, and Kinross has been re-leaching these pads) and items relating to the Rancho de Gallo camp, such as occupancy capacity, power and water delivery, and waste disposal. Kinross immediately developed and submitted a comprehensive compliance plan, which covered all measures included in the NOV and previously outlined in Kinross’ December 2012 DIA, outlining Maricunga’s plans to address the identified discrepancies at an estimated total cost of $3.2 million. Despite this proactive approach, the SMA rejected the compliance plan and posted a resolution of sanction against the Maricunga mine for $4.6 million in February 2014 in relation to the NOV. Kinross filed an appeal of the fine with Chile’s Second Environmental Court claiming, among other things, that the SMA denied Maricunga due process in connection with the sanction. In June 2014, the Environmental Court annulled  the sanction and required the SMA to consider additional evidence and information submitted by Maricunga in issuing its final ruling.