LETTER TO SHAREHOLDERS

Kinross Gold 2012 Annual Report

This decision was driven by the principle of quality versus quantity. While holding the line on our gold price assumptions reduced our 2012 year-end resource estimates, it specifically targeted higher margin ounces with less capital intensity, instead of high-cost, low-margin ounces. It should also be noted that, in a lower cost or higher gold price environment, most of these ounces may still be brought back into mineral resources.

Turning to our growth projects, we are exercising a highly disciplined approach to development, and are aiming to reduce capital requirements and execution risk while maximizing margins and cash flow.

Our Dvoinoye project in Russia remains on budget and on schedule. Dvoinoye will provide higher grade feed to the Kupol mill, which is expanding throughput to 4,500 tonnes per day, with the first shipment of ore expected in the second half of the year. The project is expected to increase production and extend mine life at Kupol.

We expect to complete the pre-feasibility study on our Tasiast expansion project at the end of the first quarter of 2013. We have made the strategic decision to pursue a smaller mill option at Tasiast, in the range of 30,000 tonnes per day, rather than the 60,000 tonnes per day option we had originally considered. This smaller mill option is expected to require less capital, reduce execution risk, deliver better margins and cash flow per ounce, increase the average gold grade over the first five to 10 years, and lower capital stripping and sustaining capital requirements – all of which are consistent with the core principles of our Way Forward strategy.

Our exploration program was active on 39 sites in 2012, with total drilling of approximately 614,000 metres. We saw early encouraging results from both Tasiast and Kupol. At Tasiast, most of our work focused on targets outside the eight-kilometre Tasiast mineral resource footprint. Results from several of those targets were encouraging and will be the focus of continued drilling in 2013. At Kupol, further high-grade mineralization was discovered at the Moroshka target. The geology of Moroshka is very similar to that of Kupol, although the vein at Moroshka is narrower.

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