Ecuador's government and Kinross Gold Corp. reached an agreement in principle on terms for the Canadian company's plan to produce gold from the country's Fruta del Norte deposit.
Among terms of the agreement, Ecuador will keep at least a 52 percent stake in the project, Kinross will be taxed at 22 percent and there will be a sliding-scale net smelter return royalty, advance royalties of $65 million credited against future royalty obligations, profit sharing and a windfall profits tax.
Kinross acquired sole interest in Fruta del Norte, which is in southeastern Ecuador in the province of Zamora-Chinchipe, in September 2008.
Proven and probable reserves are estimated at 6.8 million ounces of gold and 9.1 million ounces of silver.
Shares of Kinross, which is based in Toronto, rose in after-market trading by 16 cents to $13.61.