05:03:32 EDT Thu 01 Oct 2020
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or Name

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Kirkland Lake Gold Ltd
Symbol KL
Shares Issued 286,635,908
Close 2020-03-23 C$ 40.19
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Kirkland Lake temporarily reduces work at Detour Lake

2020-03-23 07:09 ET - News Release

Mr. Anthony Makuch reports


Kirkland Lake Gold Ltd. has begun a number of initiatives designed to protect employees, their families and local communities from the Covid-19 virus. Included among the initiatives are the introduction of company-wide health and safety protocols, a temporary reduction in operations at the Detour Lake mine, a remote operation with a large accommodation camp, until April 30, 2020, the suspension of non-essential work at all operations, as well as the suspension of all exploration activities across the company.

In addition, the company also announced today it will terminate the automatic share purchase plan (ASPP) effective March 23, 2020. The suspension reflects the company's commitment to maintaining financial strength during the current period of uncertainty related to the Covid-19 virus. The ASPP was launched on Feb. 20, 2020, in connection with the company's current normal course issuer bid (NCIB) to allow for share purchases that would not be subject to blackout periods and other restrictions. The current NCIB remains in effect on the same terms and conditions as previously disclosed. Under the current NCIB, the company can purchase up to 10.5 million additional common shares between now and its expiry on May 28, 2020. A total of 10.4 million common shares have been repurchased to date through the current NCIB, including 1.9 million shares through the ASPP. Except as set out in this press release, the company is not aware of any material undisclosed information about its business or its securities.

Covid-19 response plan

At the present time there are no confirmed cases of Covid-19 at any of the company's operations or offices. In response to the health risks associated with Covid-19, Kirkland Lake Gold has implemented a series of health and safety protocols on a company-wide basis. At the operational level, site-level controls currently in place and/or being introduced include medical screening of all individuals prior to entering site, enhanced cleaning and hygiene practices, social distancing of workers, increased reliance on the use of technology such as hosting of virtual meetings, work-from-home policies and the suspension of all non-essential work at, and visits to, the company's mine sites.

Detour Lake mine

Detour Lake mine is a camp operation, located approximately 185 kilometres northeast of Cochrane, Ont., and 300 kilometres northeast of Timmins, Ont. The camp at Detour Lake accommodates approximately 1,100 workers at any given time. To reduce risk of the Covid-19 virus, the company will transition to reduced operations effective March 23, 2020. Continuing activities at the mine will include mill processing of reduced feed from the open pit and stockpiles, management of water levels during the spring runoff, and environmental management activities. All personnel not essential for the performance of these activities will be required to leave or remain offsite until April 30, 2020. In addition, workers from remote first nations communities and those along the James Bay coast, as well as employees requiring airline transportation to get to and from the mine site, will also be advised to remain off site until the end of April. For workers affected by the move to reduced operations, the company will provide paid leave for 14 working days, the equivalent of a month of normal pay.

Approximately 300 workers are expected to remain on site to perform the essential activities during reduced operations. In addition to the health and safety protocols set out above, a number of additional measures applicable to a camp operation have been implemented, including processes for the assessment, isolation and medical evacuation of employees, increased food and hygiene safety, and a greater frequency of cleaning.

Tony Makuch, president and chief executive officer of Kirkland Lake Gold, commented: "Covid-19 represents an unprecedented challenge for people, governments and businesses worldwide. While none of our employees have tested positive for Covid-19, the actions we are taking represent our best judgement, based on what we know today, on how to responsibly protect our people from the pandemic. As always, the safety of our employees is our top priority. On a company-wide basis, we are introducing a series of health and safety protocols including medical screening, increased cleaning and hygiene, and remote work and other forms of social distancing. We are also discontinuing all non-essential work at our operations and suspending exploration activities across the company. In the case of Detour, the increased risk represented by the remoteness of the mine and the camp environment requires a more extensive response. As a result, we are transitioning to reduced operations until April 30, 2020, in order to minimize the number of people required at site. We will continue to produce, though at lower levels, and will ensure critical tasks are completed such as managing water during the spring runoff and ongoing environmental management. It is not possible at this time to estimate the impact of reduced operations on Detour Lake's 2020 production.

"Turning to our NCIB, we have been very committed to buying back our shares through the NCIB, with a total of 10.4 million shares having been repurchased under the current plan to date for a total of $360-million ($483-million (Canadian)). Given current global events, we believe it is prudent to maintain as much financial flexibility as possible. We continue to have a very strong balance sheet with close to $500-million of cash and no debt. To preserve our financial strength, we have elected to discontinue the ASPP, through which we were repurchasing approximately 103,000 shares per day on an automatic basis, outside of our discretion. We retain the option to repurchase shares through the discretionary component of the NCIB and will consider any future repurchases in relation to evolving global developments."

About Kirkland Lake Gold Ltd.

Kirkland Lake Gold is a growing gold producer operating in Canada and Australia that produced 974,615 ounces in 2019. The production profile of the company is anchored by three high-quality operations, including the Macassa mine and Detour Lake mine, both located in Northern Ontario, and the Fosterville mine located in the state of Victoria, Australia. Kirkland Lake Gold's solid base of quality assets is complemented by district-scale exploration potential, supported by a strong financial position with extensive management expertise.

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