Kellogg Company
Annual Report 2017

Plain-text annual report

Annual Report 2017 25 years of delivering value. Kinross is a global gold mining company with strong and consistent operating results driven by a high performance culture. With a diverse portfolio of mines and development projects, our focus is delivering value based on the core principles of operational excellence, balance sheet strength and responsible mining. TSX: K Toronto Stock Exchange NYSE: KGC New York Stock Exchange Celebrating Kinross Gold’s 25th Anniversary 25 years of Delivering Value 2018 marks our 25th year. Visit our 25th anniversary microsite at 25anniversary.kinross.com Dvoinoye Kupol Fort Knox Bald Mountain Toronto Round Mountain Operating mine Development projects Tasiast Chirano Paracatu La Coipa All figures are in U.S. dollars unless otherwise noted. Endnotes can be found on page 76 of this report. 01 04 Letter to Shareholders 2017 Achievements Our History (foldout) Corporate Governance Highlights 06 06 Directors + Senior Leadership 07 Financial Summary 07 Financial Review Cautionary Statement on Forward-Looking Information 74 ifc-rev.pdf - p1 (March 15, 2018 20:30:38) DT J. Paul Rollinson President and Chief Executive Officer $445.4 Million Net Earnings $1.2 Billion Adjusted Operating Cash Flow1 $2.6 Billion In Liquidity $669 Per Ounce Production Cost of Sales1 Letter to Shareholders On June 3, 1993, Kinross Gold Corporation appeared as a new listing on the Toronto Stock Exchange. In its first year of operation, the new company would account for gold equivalent production of just over 80,000 ounces. Kinross has come a long way since those humble beginnings. As we celebrate our 25th anniversary in 2018, it’s worth reflecting on the strengths that have made Kinross one of the world’s leading gold producers, and that continue to drive the exciting future we are building. The Company’s impressive performance in 2017 underscored those strengths in multiple areas. We also announced additional development opportunities. Most notably, at Fort Knox in Alaska, the Gilmore project gives us mineral rights to a significant land parcel immediately adjacent to the mine, more than doubling measured and indicated mineral resource estimates and providing an exciting opportunity to extend the life of one of our best mines. Our production of 2.67 million gold equivalent ounces2 ranked among the world’s top producers. We met our guidance for production, costs and capital expenditures for the sixth consecutive year. We finished 2017 at the high end of our production guidance and the low end on both cost of sales and all-in sustaining cost, demonstrating how the strategic priority of operational excellence has become embedded into day-to-day practice at our sites. Our teams at Bald Mountain, Round Mountain and Tasiast all deserve special mention for an outstanding year. Kinross’ financial strength – another strategic priority – was further reinforced in 2017. Our operations generated adjusted cash flow of over $1.2 billion, while our adjusted net earnings almost doubled year-over-year. Our strong liquidity of $2.6 billion gives us a solid financial foundation for advancing our impressive portfolio of low- risk, high-quality organic development projects. These projects have benefited significantly from another key Kinross strength: the skill of our technical teams in de-risking projects, optimizing mine plans, and finding innovative solutions to improve overall economics and returns by reducing capital and operating costs. In 2017, we made excellent progress at these projects and met all our key milestones, on schedule and on budget. At Tasiast, construction of the Phase One expansion advanced on schedule, and we are on track for full commercial production by the end of June 2018. We also announced that we are moving ahead with Phase Two of the expansion, which promises to deliver the full potential of the world-class Tasiast deposit. In Nevada, we are moving forward with the Round Mountain Phase W project, while the Vantage Complex at Bald Mountain is proceeding on schedule. In Russia, we look forward to initial high-grade ore from the Moroshka deposit in the second half of 2018. In 2018, we look forward to delivering on additional milestones at all of our projects and opportunities as we continue to execute our development plan. We remain prudent and disciplined in our approach to mergers, acquisitions and divestitures to generate value for shareholders. In 2017, we unlocked significant value for our shareholders and enhanced our balance sheet through the sale of Kinross’ 25% interest in Cerro Casale for consideration including $260 million in cash, a $40 million deferred payment, and a 1.25 % royalty. At the same time, we are making other prudent investments to lower costs and secure the future of our existing mines. At Paracatu in Brazil – a large, long-life cornerstone asset – we recently announced the acquisition of two hydroelectric power plants. These plants are expected to lower overall cost of sales by approximately $80 per ounce over the life of mine while securing approximately 70% of the mine’s long- term power requirements. 2017 Highlights • Achieved year-over-year improvements in safety metrics of injury frequency and severity. Regrettably, our strong safety record was overshadowed by an employee fatality at our Kupol mine, underscoring the importance of keeping safety top of mind every shift, every task. • Met production and cost guidance for the sixth consecutive year. Produced 2.67 million gold equivalent ounces (Au eq. oz.), at the high end of our guidance range, at a cost of sales of $669 per Au eq. oz., and an all-in sustaining cost of $954 per Au eq. oz., at the low end of our guidance range. • Generated $1.2 billion in adjusted operating cash flow, a $240 million increase year-over-year. KINROSS ANNUAL REPORT 2017 01 • Ended 2017 with more than $1 billion in cash and total liquidity of approximately $2.6 billion. • Advanced Phase One construction of the Tasiast mill expansion, which remains on schedule for full commercial production by the end of June 2018. • Announced decision to proceed with Phase Two of the Tasiast expansion and commenced engineering and procurement. • Announced decision to proceed with Round Mountain Phase W and commenced stripping, initial construction and site preparation activities ahead of schedule. • Advanced the Vantage Complex project at Bald Mountain on schedule. • Completed the September Northeast project in Russia and commenced development of the Moroshka deposit. • Gained mineral rights to the Gilmore land package, adding 2.1 million ounces in estimated measured and indicated mineral resources and potentially extending mine life at Fort Knox. • Launched a pre-feasibility study at Tasiast Sud. • Added approximately four million ounces to mineral reserve estimates to offset depletion. • Extended mining at Round Mountain by five years, Fort Knox mine life by one year, mill production at Kupol by one year and Paracatu mine life to 2032. • Spent more than $2 billion in countries where we operate through local purchasing, wages and taxes to benefit local communities and provide economic value. Outlook for 2018 3 We forecast another year of solid operating results in 2018. Gold production is forecast to be 2.5 million Au eq. oz., which is in line with our average production over the last several years. Looking forward, we expect production to be at or slightly above 2.5 million Au eq. oz. over the next three years. Production cost of sales in 2018 are forecast to be $730 per Au eq. oz., while all-in sustaining costs are expected to be approximately $975 per Au eq. oz., in line with the mid point of our 2017 guidance. We expect production cost of sales to decline slightly in 2019 and 2020 as lower cost production comes online. Our capital expenditures are forecast to be approximately $1.1 billion, reflecting the investments we are making in our development projects as we leverage our financial strength to build our future. 2018E Production2, 3 2.5 million (+/-5%) Russia 20% Dvoinoye Kupol West Africa 20% Tasiast Chirano 02 Americas 60% Fort Knox Bald Mountain Round Mountain Paracatu Financial Strength to Invest in our Future In 2017, our operations generated approximately $1.2 billion in adjusted operating cash flow, an increase of approximately 25% over the previous year. Year-over-year, our cash position increased by approximately $200 million, and we entered 2018 with total available liquidity of $2.6 billion. Kinross has no scheduled debt repayments until 2021. Our excellent liquidity and strong balance sheet means we are well positioned to fund our pipeline of development projects. Generating Future Value at our Development Projects Kinross’ development strategy is focused on high-quality projects in our three operating regions, offering the key benefits of low execution risk, established infrastructure, and familiar permitting and operating jurisdictions. In 2018, we expect to meet important milestones at our five projects as well as our three additional development opportunities. Tasiast Phase One: Construction of Tasiast Phase One has proceeded on time and on budget. Full commercial production is expected by the end of June 2018. Phase One is expected to almost double Tasiast’s production to approximately 400,000 Au eq. oz., and significantly reduce all-in sustaining costs. Tasiast Phase Two: Phase Two is expected to double Tasiast’s production once again to more than 800,000 Au eq. oz. per year, while further reducing costs. The project is proceeding on schedule, with project and construction teams expected to transition from Phase One to Phase Two development to establish project continuity. Phase Two is scheduled to begin commercial production in Q3 2020. Round Mountain Phase W: Strong work by our technical team contributed to a significant improvement in forecast returns for this project, which is expected to add an additional five years of mining at one of Kinross’ top performing operations. Stripping, initial construction and site preparation commenced ahead of schedule in late 2017. The project remains on schedule to encounter initial low-grade ore in mid-2019. Bald Mountain Vantage Complex: Kinross continues to view Bald Mountain as a long-life asset with considerable upside potential, given its large under-explored land package and pipeline of high-quality targets. The Vantage Complex project is proceeding on schedule, with construction well underway. Commissioning for the proposed heap leach pad and processing facilities is expected to commence in Q1 2019. Moroshka: At the Moroshka satellite deposit in Russia, located approximately four kilometres east of Kupol, development of the twin declines is on schedule and on budget. Mining of high-grade ore at Moroshka is expected to commence in the second half of 2018 for processing in the Kupol mill. Development Projects Our pipeline of five high-quality development projects are all proceeding on schedule and on budget, and extending mine life and adding ounces in all three Kinross regions – the Americas, Russia and West Africa. Three development opportunities and their exploration results are also expected to contribute to additional mine life and add reserves. expansion Tasiast on schedule and on budget Phase One project is on schedule to begin full commercial production by end of June 2018 with Phase Two on track +2 million Au oz. mineral resources Gained mining rights to Gilmore land, adding more than 2 million ounces of mineral resources to our project pipeline at Fort Knox Nevada projects Round Mountain Phase W and Bald Mountain Vantage Complex are proceeding on schedule and expected to be completed in 2019 Corporate Governance Highlights • The board met seven times in 2017. The board met independent of management at all of the meetings, including at all regularly scheduled board meetings. • All directors were independent, except the CEO. • All committees comprised solely of independent directors. • Continued to maintain board diversity target of 33% women directors. • Kinross ranked 32nd out of 242 companies in the Globe and Mail annual corporate governance survey. Kinross received a score of 89 out of 100 points, in a tie for the top ranking gold mining company and the third highest among all companies in the materials sector. • Scored 136 out of 150 points on the Board Shareholder Confidence Index of the Clarkson Centre for Board Effectiveness. Board of Directors (left to right) John E. Oliver Independent Chair H Kerry D. Dyte Corporate Director A, CGN Kelly J. Osborne Corporate Director CGN, CR Ian Atkinson Corporate Director CGN, CR Ave G. Lethbridge Corporate Director A, H Una M. Power Corporate Director A, CR John A. Brough Corporate Director A, H Catherine McLeod-Seltzer Corporate Director CGN, CR J. Paul Rollinson President and Chief Executive Officer A Audit and Risk Committee CGN Corporate Governance and Nominating Committee CR H Corporate Responsibility and Technical Committee Human Resource and Compensation Committee Responsible Mining Mining responsibly is integral to our business strategy. This requires operating in accordance with the highest standards of ethical conduct, and responsibly managing our impacts while leveraging opportunities from our activities to generate sustainable long-term value in host communities. Safety is our first priority. In 2017, year-over-year improvements in reportable injury rates were overshadowed by a single employee fatality, the first at a Kinross operation since 2012. $2+ billion spent in host countries 97% of workforce from host countries met or exceeded environmental targets The local procurement, wages, and taxes generated by our operations are an important contribution to the economies of host countries Creating meaningful livelihoods for our employees is one of the most powerful impacts of our business Delivered on site-level targets for permitting, water management and concurrent reclamation Senior Leadership Team (left to right) Lauren M. Roberts Senior Vice-President and Chief Operating Officer J. Paul Rollinson President and Chief Executive Officer Paul B. Tomory Senior Vice-President and Chief Technical Officer Tony S. Giardini Executive Vice-President and Chief Financial Officer Gina M. Jardine Senior Vice-President, Human Resources Geoffrey P. Gold Executive Vice-President, Corporate Development, External Relations and Chief Legal Officer LEARN MORE ABOUT OUR HISTORY KINROSS ANNUAL REPORT 2017 05 06 Fort Knox Gilmore: In late 2017, we were excited to announce that we gained mineral rights to the Gilmore land package, which lies immediately adjacent to Fort Knox and has the potential to extend mine life at one of our best operations. As a result of previous drilling at Gilmore, we have added 2.1 million ounces in estimated measured and indicated mineral resources at Fort Knox. A feasibility study to assess a multi-phase layback of the Fort Knox pit, and the construction of a new heap leach pad, is expected to be completed in mid-2018. Tasiast Sud: A pre-feasibility study (PFS) for this Tasiast satellite deposit is proceeding as planned and is expected to be completed in the second half of 2018. The PFS contemplates a dump leach operation that would combine materials from multiple deposits in the area, and the trucking of high-grade ore to the Tasiast mill, located approximately 10 kilometres north of the project. La Coipa Restart: In February 2018, Kinross entered into an agreement to acquire 50% of the Phase 7 deposit from its joint venture partner, which will give the Company 100% ownership of the Phase 7 deposit and the mining rights contemplated by the pre-feasibility study completed in 2015. The Company expects to receive the remaining sectoral permits required for the project in the first half of 2018. Exploration Review Kinross’ 2017 exploration program was highly successful in adding valuable resource ounces to our operations. We added more than 3.5 million ounces to measured and indicated mineral resource estimates, mainly from Fort Knox, Round Mountain and Kupol.4 We have a particularly strong track record of adding ounces and extending mine life at our Russian mines and have now extended expected mill production at Kupol – a high-grade, high-margin asset – until the end of 2022. Kupol will again be an exploration priority in 2018. Other 2018 priorities include Bald Mountain, where we will conduct infill drilling and focus on earlier stage targets, and Tasiast Sud. While brownfields exploration remains Kinross’ core exploration focus, we also pursue greenfields opportunities and high-margin types of deposits through strategic investments and partnerships with high-quality junior exploration companies. Commitment to Responsible Mining We take pride in our 25-year history of cooperative relations with our host countries and local communities. That history has depended in part on strong company- wide standards and policies to back up our firm commitment to responsible mining. But it is also the result of diligent work by our local teams to maintain respectful, mutually beneficial relationships at a grassroots level – helping to ensure that Kinross is consistently regarded as a good neighbour wherever we operate. For example, at our Mineral Hill reclamation site, we were proud to partner with Trout Unlimited and the Rocky Mountain Elk Foundation to achieve positive benefits for the environment and local community by protecting important fish and wildlife habitat near Yellowstone National Park. We also actively listen and engage with our stakeholders. In 2017, we had more than 112,000 stakeholder interactions, including community members, government representatives, and non-profit organizations at our sites. Another key is helping our host communities build sustainable economic strength and capacity. In 2017, we spent more than $2 billion in the countries where we operate through wages, local purchasing, and taxes, in addition to our many direct and in-kind contributions in support of health, education, social, cultural, and environmental programs. In 2017, for the eighth consecutive year, Kinross Gold was named one of Canada’s Best 50 Corporate Citizens by Corporate Knights magazine, placing first among gold mining companies for the third year in a row. Strength for the Future We believe the strengths Kinross has built represent significant value in today’s mining world, and bode very well for our future success: • An unbroken six-year record of consistently delivering results and meeting production and cost targets at our operations; • A diverse pipeline of projects and development opportunities with low execution risk that are expected to maintain strong, low-cost production into the future; • A record of meeting key project milestones on time and on budget; • A strong balance sheet and the liquidity to fund our project pipeline; • A highly skilled team with exceptional technical strength, both at our operations and our projects; • A strong culture underpinned by our eight People Commitments; • An excellent record of co-operative relations with our host governments and communities; and • One of the best safety records in the industry. In closing, let me thank our employees – past and present – who have helped Kinross to grow and thrive for these 25 years. As our story enters its next exciting chapter, I also thank our shareholders for your continued support. 2017 Achievements Operational Excellence Kinross achieved sixth straight year of strong results and meeting production and cost guidance. We remained focused on operational excellence, building a culture of continuous improvement, innovation and disciplined cost management. 6 consecutive years 2.67 million Au eq. oz. $669 per Au eq. oz. production cost of sales1 Sixth consecutive year meeting or outperforming our production and cost guidance Delivered strong production with each region meeting guidance Decreased production cost of sales year- over-year by more than $40 per ounce and at the low end of guidance Financial Discipline We maintained significant liquidity and a strong balance sheet throughout 2017. With strong cash flow and zero debt maturities until 2021, we have the financial strength and flexibility to fund our pipeline of development growth projects. $2.6 billion in liquidity $1.2 billion in adjusted operating cash flow1 zero debt maturities until 2021 Maintained one of the strongest balance sheets in the industry Increased adjusted operating cash flow by $240 million year-over-year Manageable debt schedule with no debt maturities until 2021 J. Paul Rollinson President and Chief Executive Officer KINROSS ANNUAL REPORT 2017 03 04 2017 Achievements Operational Excellence Kinross achieved sixth straight year of strong results and meeting production and cost guidance. We remained focused on operational excellence, building a culture of continuous improvement, innovation and disciplined cost management. 6 consecutive years 2.67 million Au eq. oz. $669 per Au eq. oz. production cost of sales1 Sixth consecutive year meeting or outperforming our production and cost guidance Delivered strong production with each region meeting guidance Decreased production cost of sales year- over-year by more than $40 per ounce and at the low end of guidance Financial Discipline We maintained significant liquidity and a strong balance sheet throughout 2017. With strong cash flow and zero debt maturities until 2021, we have the financial strength and flexibility to fund our pipeline of development growth projects. $2.6 billion in liquidity $1.2 billion in adjusted operating cash flow1 zero debt maturities until 2021 Maintained one of the strongest balance sheets in the industry Increased adjusted operating cash flow by $240 million year-over-year Manageable debt schedule with no debt maturities until 2021 04 Development Projects Our pipeline of five high-quality development projects are all proceeding on schedule and on budget, and extending mine life and adding ounces in all three Kinross regions – the Americas, Russia and West Africa. Three development opportunities and their exploration results are also expected to contribute to additional mine life and add reserves. expansion Tasiast on schedule and on budget Phase One project is on schedule to begin full commercial production by end of June 2018 with Phase Two on track +2 million Au oz. mineral resources Gained mining rights to Gilmore land, adding more than 2 million ounces of mineral resources to our project pipeline at Fort Knox Nevada projects Round Mountain Phase W and Bald Mountain Vantage Complex are proceeding on schedule and expected to be completed in 2019 Corporate Governance Highlights • The board met seven times in 2017. The board met independent of management at all of the meetings, including at all regularly scheduled board meetings. • All directors were independent, except the CEO. • All committees comprised solely of independent directors. • Continued to maintain board diversity target of 33% women directors. • Kinross ranked 32nd out of 242 companies in the Globe and Mail annual corporate governance survey. Kinross received a score of 89 out of 100 points, in a tie for the top ranking gold mining company and the third highest among all companies in the materials sector. • Scored 136 out of 150 points on the Board Shareholder Confidence Index of the Clarkson Centre for Board Effectiveness. Board of Directors (left to right) John E. Oliver Independent Chair H Kerry D. Dyte Corporate Director A, CGN Kelly J. Osborne Corporate Director CGN, CR Ian Atkinson Corporate Director CGN, CR Ave G. Lethbridge Corporate Director A, H Una M. Power Corporate Director A, CR John A. Brough Corporate Director A, H Catherine McLeod-Seltzer Corporate Director CGN, CR J. Paul Rollinson President and Chief Executive Officer A Audit and Risk Committee CGN Corporate Governance and Nominating Committee CR H Corporate Responsibility and Technical Committee Human Resource and Compensation Committee Responsible Mining Mining responsibly is integral to our business strategy. This requires operating in accordance with the highest standards of ethical conduct, and responsibly managing our impacts while leveraging opportunities from our activities to generate sustainable long-term value in host communities. Safety is our first priority. In 2017, year-over-year improvements in reportable injury rates were overshadowed by a single employee fatality, the first at a Kinross operation since 2012. $2+ billion spent in host countries 97% of workforce from host countries met or exceeded environmental targets The local procurement, wages, and taxes generated by our operations are an important contribution to the economies of host countries Creating meaningful livelihoods for our employees is one of the most powerful impacts of our business Delivered on site-level targets for permitting, water management and concurrent reclamation Senior Leadership Team (left to right) Lauren M. Roberts Senior Vice-President and Chief Operating Officer J. Paul Rollinson President and Chief Executive Officer Paul B. Tomory Senior Vice-President and Chief Technical Officer Tony S. Giardini Executive Vice-President and Chief Financial Officer Gina M. Jardine Senior Vice-President, Human Resources Geoffrey P. Gold Executive Vice-President, Corporate Development, External Relations and Chief Legal Officer LEARN MORE ABOUT OUR HISTORY KINROSS ANNUAL REPORT 2017 05 06 K.4.232 Kinross2017AR_FA_Mar14rev22.pdf - p1 (March 15, 2018 20:35:52) DT Founder Robert M. Buchan (P. Eng.) establishes Kinross through the amalgamation of CMP Resources Ltd., Plexus Resources and 1021105 Ontario Corporation On May 31, 1993 Kinross enters the global gold mining business 1.6 million Au oz. in estimated proven and probable reserves K Kinross is listed on the Toronto Stock Exchange (TSX) on June 3rd 83,000 Au eq. oz. total production Kinross welcomes the Fort Knox mine in Alaska, which continues to be a top producer, and 50% of the Maricunga mine in Chile, through the acquisition of Amax Gold. Kinross becomes the fifth largest gold producer in North America with annual production of over 874,000 Au eq. oz. Merges with TVX Gold and Echo Bay Mines Ltd. Assets include: La Coipa in Chile (50%) Paracatu in Brazil (49%) Round Mountain in Nevada (50%) Kettle River in Washington State (100%) KGC Kinross is listed on the New York Stock Exchange on February 3, 2003 Our History A significant milestone: Kinross Gold has been operating for a quarter of a century. Twenty-five years of responsible mining and almost 40 million ounces of gold produced. Our timeline showcases key moments, accolades and milestones in Kinross’ rich 25-year history. Kinross acquires Crown Resources Corporation, gaining 100% ownership of the Buckhorn deposit in Washington State Kettle River receives the Mining Health and Safety Administration Sentinels of Safety National Award for two consecutive years (2005 and 2006) and zero lost-time injuries Consolidates 100% ownership of the Paracatu mine, purchasing the remaining 51% interest from Rio Tinto First gold poured at Paracatu expansion project, transforming it into one of Brazil’s largest gold mines Commercial production begins at Kettle River- Buckhorn, a model for environmentally responsible small footprint mining Completes construction of the Kupol gold mine and begins commercial production, overcoming logistical challenges associated with remoteness of Russia’s Far East 1.8 million Au eq. oz. production milestone Launches four core values company-wide – the pillars of Kinross’ culture OUR VALUES: • Putting people first • Outstanding corporate citizenship • High performance culture • Rigorous financial discipline KINROSS OPERATIONS TODAY Fort Knox Bald Mountain Round Mountain Toronto Tasiast Chirano Paracatu La Coipa Dvoinoye Kupol Operating mine Development projects Expands our global portfolio through the acquisition of the Tasiast mine in Mauritania and the Chirano mine in Ghana J. Paul Rollinson is appointed Chief Executive Officer Mining operations come to an end at Kettle River-Buckhorn, two years later than scheduled and after producing 200,000 ounces more than originally planned Announces a unique partnership with Trout Unlimited and the Rocky Mountain Elk Foundation to protect wildlife habitat near Yellowstone National Park as part of Mineral Hill reclamation Acquires the high- grade Dvoinoye deposit approximately 100 km north of Kupol Advances corporate-wide culture of “Continuous Improvement” to ensure operational excellence globally Drives Company focus on: • Safety and Mining Responsibly • Operational Excellence • Financial Discipline and Balance Sheet Strength • Quality over Quantity Celebrates 20 years of successful operation in Russia Achieves 33% board gender diversity target with six men and three women Named one of Canada’s Top 50 Corporate Citizens by Corporate Knights for the eighth consecutive year, and was ranked as the top gold mining company for the third consecutive year Addition of over 2 million ounces to our mineral resource estimates after gaining mining rights to land adjacent Fort Knox Company executing on 5 projects and advancing 3 development opportunities • Tasiast Phase One and Phase Two • Round Mountain Phase W • Bald Mountain Vantage Complex • Moroshka project in Russia • Fort Knox Gilmore feasibility study • Tasiast Sud pre-feasibility study • La Coipa Restart 1993 FIRST YEAR 1998 GROWTH THROUGH ACQUISITION 2003 GROWING GLOBALLY 2004 EXPANDING OPERATIONS 2006 RESPONSIBLE MINING 2008 GROWING OUR BUSINESS GLOBALLY 2010 A TRANSFORMATIONAL YEAR 2012 2015 BUILDING VALUE 2017 DISCIPLINED GROWTH 2018 THE FUTURE IS BRIGHT 1995 RUSSIA’S FAR EAST 2002 INDUSTRY LEADERSHIP Kinross’ first entry into Russia with a minority interest in the Aginksoe project Contributes to international standards and codes for the use of cyanide in the gold industry and commits to the International Cyanide Management Code 2005 Tye W. Burt is appointed President and Chief Executive Officer 2007 A PIVOTAL YEAR 2009 RECORD PRODUCTION AND REVENUE 2011 SUPPORTING EDUCATION 2013 20 YEARS OF RESPONSIBLE MINING 2014 MINING RESPONSIBLY 2016 OPERATIONAL EXCELLENCE Kinross acquires Bema Gold, adding to our growing global portfolio. Acquisition includes: The remaining 50% interest in Maricunga, giving Kinross full ownership A 75% interest in the Kupol gold-silver project in Far East Russia Receives an “A” rating in the Maclean’s magazine annual corporate responsibility survey, the highest grade earned by a Canadian mining company Chosen as a constituent of the Jantzi Social Index®, a leading index of socially responsible, Canadian-based companies Receives top honours for safety practices at Round Mountain, Kettle River-Buckhorn and Paracatu Launches Ten Guiding Principles for Corporate Responsibility, a set of clear, non-negotiable standards at the core of our CR strategy 2.2 million Au eq. oz. record production Introduces the “Living Our Values Awards” (LOVA) program to celebrate employees who exemplify our values every day Commits to major funding of mining education in Alaska and Mauritania Commercial production gets underway at Dvoinoye, on schedule and on budget Named to Dow Jones Sustainability World Index for first time and maintains place on the Dow Jones Sustainability Index North America Increases ownership at Kupol to 100% Achieves highest gold production in the company’s history, a record 2.8 million Au eq. oz. 31 million ounces of gold in proven and probable reserves Launches Phase One expansion at Tasiast, part of a two-phased expansion of the mine Named the top gold mining company in the World Wildlife Fund’s rating of companies in Russia Focuses on high-quality Nevada assets: completes acquisition of Bald Mountain mine and remaining 50% of Round Mountain mine Achieves gold production milestones – Fort Knox pours seven millionth ounce and Kupol celebrates five million ounces Receives its fourth award for reclamation from the U.S. Bureau of Land Management, this time for the social closure plan at Kettle River-Buckhorn Doubles mineral reserves at Bald Mountain to support potential significant mine life extension Contributes to 687 local community programs, initiatives and events to an estimated 805,000 people through cash and in-kind donations 2.7 million Au eq. oz. record production Founder Robert M. Buchan (P. Eng.) establishes Kinross through the amalgamation of CMP Resources Ltd., Plexus Resources and 1021105 Ontario Corporation On May 31, 1993 Kinross enters the global gold mining business 1.6 million Au oz. in estimated proven and probable reserves K Kinross is listed on the Toronto Stock Exchange (TSX) on June 3rd 83,000 Au eq. oz. total production Kinross welcomes the Fort Knox mine in Alaska, which continues to be a top producer, and 50% of the Maricunga mine in Chile, through the acquisition of Amax Gold. Kinross becomes the fifth largest gold producer in North America with annual production of over 874,000 Au eq. oz. Merges with TVX Gold and Echo Bay Mines Ltd. Assets include: La Coipa in Chile (50%) Paracatu in Brazil (49%) Round Mountain in Nevada (50%) Kettle River in Washington State (100%) KGC Kinross is listed on the New York Stock Exchange on February 3, 2003 Our History A significant milestone: Kinross Gold has been operating for a quarter of a century. Twenty-five years of responsible mining and almost 40 million ounces of gold produced. Our timeline showcases key moments, accolades and milestones in Kinross’ rich 25-year history. Kinross acquires Crown Resources Corporation, gaining 100% ownership of the Buckhorn deposit in Washington State Kettle River receives the Mining Health and Safety Administration Sentinels of Safety National Award for two consecutive years (2005 and 2006) and zero lost-time injuries Consolidates 100% ownership of the Paracatu mine, purchasing the remaining 51% interest from Rio Tinto First gold poured at Paracatu expansion project, transforming it into one of Brazil’s largest gold mines Commercial production begins at Kettle River- Buckhorn, a model for environmentally responsible small footprint mining Completes construction of the Kupol gold mine and begins commercial production, overcoming logistical challenges associated with remoteness of Russia’s Far East 1.8 million Au eq. oz. production milestone Launches four core values company-wide – the pillars of Kinross’ culture OUR VALUES: • Putting people first • Outstanding corporate citizenship • High performance culture • Rigorous financial discipline KINROSS OPERATIONS TODAY Fort Knox Bald Mountain Round Mountain Toronto Tasiast Chirano Paracatu La Coipa Dvoinoye Kupol Operating mine Development projects Expands our global portfolio through the acquisition of the Tasiast mine in Mauritania and the Chirano mine in Ghana J. Paul Rollinson is appointed Chief Executive Officer Mining operations come to an end at Kettle River-Buckhorn, two years later than scheduled and after producing 200,000 ounces more than originally planned Announces a unique partnership with Trout Unlimited and the Rocky Mountain Elk Foundation to protect wildlife habitat near Yellowstone National Park as part of Mineral Hill reclamation Acquires the high- grade Dvoinoye deposit approximately 100 km north of Kupol Advances corporate-wide culture of “Continuous Improvement” to ensure operational excellence globally Drives Company focus on: • Safety and Mining Responsibly • Operational Excellence • Financial Discipline and Balance Sheet Strength • Quality over Quantity Celebrates 20 years of successful operation in Russia Achieves 33% board gender diversity target with six men and three women Named one of Canada’s Top 50 Corporate Citizens by Corporate Knights for the eighth consecutive year, and was ranked as the top gold mining company for the third consecutive year Addition of over 2 million ounces to our mineral resource estimates after gaining mining rights to land adjacent Fort Knox Company executing on 5 projects and advancing 3 development opportunities • Tasiast Phase One and Phase Two • Round Mountain Phase W • Bald Mountain Vantage Complex • Moroshka project in Russia • Fort Knox Gilmore feasibility study • Tasiast Sud pre-feasibility study • La Coipa Restart 1993 FIRST YEAR 1998 GROWTH THROUGH ACQUISITION 2003 GROWING GLOBALLY 2004 EXPANDING OPERATIONS 2006 RESPONSIBLE MINING 2008 GROWING OUR BUSINESS GLOBALLY 2010 A TRANSFORMATIONAL YEAR 2012 2015 BUILDING VALUE 2017 DISCIPLINED GROWTH 2018 THE FUTURE IS BRIGHT 1995 RUSSIA’S FAR EAST 2002 INDUSTRY LEADERSHIP Kinross’ first entry into Russia with a minority interest in the Aginksoe project Contributes to international standards and codes for the use of cyanide in the gold industry and commits to the International Cyanide Management Code 2005 Tye W. Burt is appointed President and Chief Executive Officer 2007 A PIVOTAL YEAR 2009 RECORD PRODUCTION AND REVENUE 2011 SUPPORTING EDUCATION 2013 20 YEARS OF RESPONSIBLE MINING 2014 MINING RESPONSIBLY 2016 OPERATIONAL EXCELLENCE Kinross acquires Bema Gold, adding to our growing global portfolio. Acquisition includes: The remaining 50% interest in Maricunga, giving Kinross full ownership A 75% interest in the Kupol gold-silver project in Far East Russia Receives an “A” rating in the Maclean’s magazine annual corporate responsibility survey, the highest grade earned by a Canadian mining company Chosen as a constituent of the Jantzi Social Index®, a leading index of socially responsible, Canadian-based companies Receives top honours for safety practices at Round Mountain, Kettle River-Buckhorn and Paracatu Launches Ten Guiding Principles for Corporate Responsibility, a set of clear, non-negotiable standards at the core of our CR strategy 2.2 million Au eq. oz. record production Introduces the “Living Our Values Awards” (LOVA) program to celebrate employees who exemplify our values every day Commits to major funding of mining education in Alaska and Mauritania Commercial production gets underway at Dvoinoye, on schedule and on budget Named to Dow Jones Sustainability World Index for first time and maintains place on the Dow Jones Sustainability Index North America Increases ownership at Kupol to 100% Achieves highest gold production in the company’s history, a record 2.8 million Au eq. oz. 31 million ounces of gold in proven and probable reserves Launches Phase One expansion at Tasiast, part of a two-phased expansion of the mine Named the top gold mining company in the World Wildlife Fund’s rating of companies in Russia Focuses on high-quality Nevada assets: completes acquisition of Bald Mountain mine and remaining 50% of Round Mountain mine Achieves gold production milestones – Fort Knox pours seven millionth ounce and Kupol celebrates five million ounces Receives its fourth award for reclamation from the U.S. Bureau of Land Management, this time for the social closure plan at Kettle River-Buckhorn Doubles mineral reserves at Bald Mountain to support potential significant mine life extension Contributes to 687 local community programs, initiatives and events to an estimated 805,000 people through cash and in-kind donations 2.7 million Au eq. oz. record production Founder Robert M. Buchan (P. Eng.) establishes Kinross through the amalgamation of CMP Resources Ltd., Plexus Resources and 1021105 Ontario Corporation On May 31, 1993 Kinross enters the global gold mining business 1.6 million Au oz. in estimated proven and probable reserves K Kinross is listed on the Toronto Stock Exchange (TSX) on June 3rd 83,000 Au eq. oz. total production Kinross welcomes the Fort Knox mine in Alaska, which continues to be a top producer, and 50% of the Maricunga mine in Chile, through the acquisition of Amax Gold. Kinross becomes the fifth largest gold producer in North America with annual production of over 874,000 Au eq. oz. Merges with TVX Gold and Echo Bay Mines Ltd. Assets include: La Coipa in Chile (50%) Paracatu in Brazil (49%) Round Mountain in Nevada (50%) Kettle River in Washington State (100%) KGC Kinross is listed on the New York Stock Exchange on February 3, 2003 Our History A significant milestone: Kinross Gold has been operating for a quarter of a century. Twenty-five years of responsible mining and almost 40 million ounces of gold produced. Our timeline showcases key moments, accolades and milestones in Kinross’ rich 25-year history. Kinross acquires Crown Resources Corporation, gaining 100% ownership of the Buckhorn deposit in Washington State Kettle River receives the Mining Health and Safety Administration Sentinels of Safety National Award for two consecutive years (2005 and 2006) and zero lost-time injuries Consolidates 100% ownership of the Paracatu mine, purchasing the remaining 51% interest from Rio Tinto First gold poured at Paracatu expansion project, transforming it into one of Brazil’s largest gold mines Commercial production begins at Kettle River- Buckhorn, a model for environmentally responsible small footprint mining Completes construction of the Kupol gold mine and begins commercial production, overcoming logistical challenges associated with remoteness of Russia’s Far East 1.8 million Au eq. oz. production milestone Launches four core values company-wide – the pillars of Kinross’ culture OUR VALUES: • Putting people first • Outstanding corporate citizenship • High performance culture • Rigorous financial discipline KINROSS OPERATIONS TODAY Fort Knox Bald Mountain Round Mountain Toronto Tasiast Chirano Paracatu La Coipa Dvoinoye Kupol Operating mine Development projects Expands our global portfolio through the acquisition of the Tasiast mine in Mauritania and the Chirano mine in Ghana J. Paul Rollinson is appointed Chief Executive Officer Mining operations come to an end at Kettle River-Buckhorn, two years later than scheduled and after producing 200,000 ounces more than originally planned Announces a unique partnership with Trout Unlimited and the Rocky Mountain Elk Foundation to protect wildlife habitat near Yellowstone National Park as part of Mineral Hill reclamation Acquires the high- grade Dvoinoye deposit approximately 100 km north of Kupol Advances corporate-wide culture of “Continuous Improvement” to ensure operational excellence globally Drives Company focus on: • Safety and Mining Responsibly • Operational Excellence • Financial Discipline and Balance Sheet Strength • Quality over Quantity Celebrates 20 years of successful operation in Russia Achieves 33% board gender diversity target with six men and three women Named one of Canada’s Top 50 Corporate Citizens by Corporate Knights for the eighth consecutive year, and was ranked as the top gold mining company for the third consecutive year Addition of over 2 million ounces to our mineral resource estimates after gaining mining rights to land adjacent Fort Knox Company executing on 5 projects and advancing 3 development opportunities • Tasiast Phase One and Phase Two • Round Mountain Phase W • Bald Mountain Vantage Complex • Moroshka project in Russia • Fort Knox Gilmore feasibility study • Tasiast Sud pre-feasibility study • La Coipa Restart 1993 FIRST YEAR 1998 GROWTH THROUGH ACQUISITION 2003 GROWING GLOBALLY 2004 EXPANDING OPERATIONS 2006 RESPONSIBLE MINING 2008 GROWING OUR BUSINESS GLOBALLY 2010 A TRANSFORMATIONAL YEAR 2012 2015 BUILDING VALUE 2017 DISCIPLINED GROWTH 2018 THE FUTURE IS BRIGHT 1995 RUSSIA’S FAR EAST 2002 INDUSTRY LEADERSHIP Kinross’ first entry into Russia with a minority interest in the Aginksoe project Contributes to international standards and codes for the use of cyanide in the gold industry and commits to the International Cyanide Management Code 2005 Tye W. Burt is appointed President and Chief Executive Officer 2007 A PIVOTAL YEAR 2009 RECORD PRODUCTION AND REVENUE 2011 SUPPORTING EDUCATION 2013 20 YEARS OF RESPONSIBLE MINING 2014 MINING RESPONSIBLY 2016 OPERATIONAL EXCELLENCE Kinross acquires Bema Gold, adding to our growing global portfolio. Acquisition includes: The remaining 50% interest in Maricunga, giving Kinross full ownership A 75% interest in the Kupol gold-silver project in Far East Russia Receives an “A” rating in the Maclean’s magazine annual corporate responsibility survey, the highest grade earned by a Canadian mining company Chosen as a constituent of the Jantzi Social Index®, a leading index of socially responsible, Canadian-based companies Receives top honours for safety practices at Round Mountain, Kettle River-Buckhorn and Paracatu Launches Ten Guiding Principles for Corporate Responsibility, a set of clear, non-negotiable standards at the core of our CR strategy 2.2 million Au eq. oz. record production Introduces the “Living Our Values Awards” (LOVA) program to celebrate employees who exemplify our values every day Commits to major funding of mining education in Alaska and Mauritania Commercial production gets underway at Dvoinoye, on schedule and on budget Named to Dow Jones Sustainability World Index for first time and maintains place on the Dow Jones Sustainability Index North America Increases ownership at Kupol to 100% Achieves highest gold production in the company’s history, a record 2.8 million Au eq. oz. 31 million ounces of gold in proven and probable reserves Launches Phase One expansion at Tasiast, part of a two-phased expansion of the mine Named the top gold mining company in the World Wildlife Fund’s rating of companies in Russia Focuses on high-quality Nevada assets: completes acquisition of Bald Mountain mine and remaining 50% of Round Mountain mine Achieves gold production milestones – Fort Knox pours seven millionth ounce and Kupol celebrates five million ounces Receives its fourth award for reclamation from the U.S. Bureau of Land Management, this time for the social closure plan at Kettle River-Buckhorn Doubles mineral reserves at Bald Mountain to support potential significant mine life extension Contributes to 687 local community programs, initiatives and events to an estimated 805,000 people through cash and in-kind donations 2.7 million Au eq. oz. record production Founder Robert M. Buchan (P. Eng.) establishes Kinross through the amalgamation of CMP Resources Ltd., Plexus Resources and 1021105 Ontario Corporation On May 31, 1993 Kinross enters the global gold mining business 1.6 million Au oz. in estimated proven and probable reserves K Kinross is listed on the Toronto Stock Exchange (TSX) on June 3rd 83,000 Au eq. oz. total production Kinross welcomes the Fort Knox mine in Alaska, which continues to be a top producer, and 50% of the Maricunga mine in Chile, through the acquisition of Amax Gold. Kinross becomes the fifth largest gold producer in North America with annual production of over 874,000 Au eq. oz. Merges with TVX Gold and Echo Bay Mines Ltd. Assets include: La Coipa in Chile (50%) Paracatu in Brazil (49%) Round Mountain in Nevada (50%) Kettle River in Washington State (100%) KGC Kinross is listed on the New York Stock Exchange on February 3, 2003 Our History A significant milestone: Kinross Gold has been operating for a quarter of a century. Twenty-five years of responsible mining and almost 40 million ounces of gold produced. Our timeline showcases key moments, accolades and milestones in Kinross’ rich 25-year history. Kinross acquires Crown Resources Corporation, gaining 100% ownership of the Buckhorn deposit in Washington State Kettle River receives the Mining Health and Safety Administration Sentinels of Safety National Award for two consecutive years (2005 and 2006) and zero lost-time injuries Consolidates 100% ownership of the Paracatu mine, purchasing the remaining 51% interest from Rio Tinto First gold poured at Paracatu expansion project, transforming it into one of Brazil’s largest gold mines Commercial production begins at Kettle River- Buckhorn, a model for environmentally responsible small footprint mining Completes construction of the Kupol gold mine and begins commercial production, overcoming logistical challenges associated with remoteness of Russia’s Far East 1.8 million Au eq. oz. production milestone Launches four core values company-wide – the pillars of Kinross’ culture OUR VALUES: • Putting people first • Outstanding corporate citizenship • High performance culture • Rigorous financial discipline KINROSS OPERATIONS TODAY Fort Knox Bald Mountain Round Mountain Toronto Tasiast Chirano Paracatu La Coipa Dvoinoye Kupol Operating mine Development projects Expands our global portfolio through the acquisition of the Tasiast mine in Mauritania and the Chirano mine in Ghana J. Paul Rollinson is appointed Chief Executive Officer Mining operations come to an end at Kettle River-Buckhorn, two years later than scheduled and after producing 200,000 ounces more than originally planned Announces a unique partnership with Trout Unlimited and the Rocky Mountain Elk Foundation to protect wildlife habitat near Yellowstone National Park as part of Mineral Hill reclamation Acquires the high- grade Dvoinoye deposit approximately 100 km north of Kupol Advances corporate-wide culture of “Continuous Improvement” to ensure operational excellence globally Drives Company focus on: • Safety and Mining Responsibly • Operational Excellence • Financial Discipline and Balance Sheet Strength • Quality over Quantity Celebrates 20 years of successful operation in Russia Achieves 33% board gender diversity target with six men and three women Named one of Canada’s Top 50 Corporate Citizens by Corporate Knights for the eighth consecutive year, and was ranked as the top gold mining company for the third consecutive year Addition of over 2 million ounces to our mineral resource estimates after gaining mining rights to land adjacent Fort Knox Company executing on 5 projects and advancing 3 development opportunities • Tasiast Phase One and Phase Two • Round Mountain Phase W • Bald Mountain Vantage Complex • Moroshka project in Russia • Fort Knox Gilmore feasibility study • Tasiast Sud pre-feasibility study • La Coipa Restart 1993 FIRST YEAR 1998 GROWTH THROUGH ACQUISITION 2003 GROWING GLOBALLY 2004 EXPANDING OPERATIONS 2006 RESPONSIBLE MINING 2008 GROWING OUR BUSINESS GLOBALLY 2010 A TRANSFORMATIONAL YEAR 2012 2015 BUILDING VALUE 2017 DISCIPLINED GROWTH 2018 THE FUTURE IS BRIGHT 1995 RUSSIA’S FAR EAST 2002 INDUSTRY LEADERSHIP Kinross’ first entry into Russia with a minority interest in the Aginksoe project Contributes to international standards and codes for the use of cyanide in the gold industry and commits to the International Cyanide Management Code 2005 Tye W. Burt is appointed President and Chief Executive Officer 2007 A PIVOTAL YEAR 2009 RECORD PRODUCTION AND REVENUE 2011 SUPPORTING EDUCATION 2013 20 YEARS OF RESPONSIBLE MINING 2014 MINING RESPONSIBLY 2016 OPERATIONAL EXCELLENCE Kinross acquires Bema Gold, adding to our growing global portfolio. Acquisition includes: The remaining 50% interest in Maricunga, giving Kinross full ownership A 75% interest in the Kupol gold-silver project in Far East Russia Receives an “A” rating in the Maclean’s magazine annual corporate responsibility survey, the highest grade earned by a Canadian mining company Chosen as a constituent of the Jantzi Social Index®, a leading index of socially responsible, Canadian-based companies Receives top honours for safety practices at Round Mountain, Kettle River-Buckhorn and Paracatu Launches Ten Guiding Principles for Corporate Responsibility, a set of clear, non-negotiable standards at the core of our CR strategy 2.2 million Au eq. oz. record production Introduces the “Living Our Values Awards” (LOVA) program to celebrate employees who exemplify our values every day Commits to major funding of mining education in Alaska and Mauritania Commercial production gets underway at Dvoinoye, on schedule and on budget Named to Dow Jones Sustainability World Index for first time and maintains place on the Dow Jones Sustainability Index North America Increases ownership at Kupol to 100% Achieves highest gold production in the company’s history, a record 2.8 million Au eq. oz. 31 million ounces of gold in proven and probable reserves Launches Phase One expansion at Tasiast, part of a two-phased expansion of the mine Named the top gold mining company in the World Wildlife Fund’s rating of companies in Russia Focuses on high-quality Nevada assets: completes acquisition of Bald Mountain mine and remaining 50% of Round Mountain mine Achieves gold production milestones – Fort Knox pours seven millionth ounce and Kupol celebrates five million ounces Receives its fourth award for reclamation from the U.S. Bureau of Land Management, this time for the social closure plan at Kettle River-Buckhorn Doubles mineral reserves at Bald Mountain to support potential significant mine life extension Contributes to 687 local community programs, initiatives and events to an estimated 805,000 people through cash and in-kind donations 2.7 million Au eq. oz. record production Development Projects Our pipeline of five high-quality development projects are all proceeding on schedule and on budget, and extending mine life and adding ounces in all three Kinross regions – the Americas, Russia and West Africa. Three development opportunities and their exploration results are also expected to contribute to additional mine life and add reserves. expansion Tasiast on schedule and on budget Phase One project is on schedule to begin full commercial production by end of June 2018 with Phase Two on track +2 million Au oz. mineral resources Gained mining rights to Gilmore land, adding more than 2 million ounces of mineral resources to our project pipeline at Fort Knox Nevada projects Round Mountain Phase W and Bald Mountain Vantage Complex are proceeding on schedule and expected to be completed in 2019 Corporate Governance Highlights • The board met seven times in 2017. The board met independent of management at all of the meetings, including at all regularly scheduled board meetings. • All directors were independent, except the CEO. • All committees comprised solely of independent directors. • Continued to maintain board diversity target of 33% women directors. • Kinross ranked 32nd out of 242 companies in the Globe and Mail annual corporate governance survey. Kinross received a score of 89 out of 100 points, in a tie for the top ranking gold mining company and the third highest among all companies in the materials sector. • Scored 136 out of 150 points on the Board Shareholder Confidence Index of the Clarkson Centre for Board Effectiveness. Board of Directors (left to right) John E. Oliver Independent Chair H Kerry D. Dyte Corporate Director A, CGN Kelly J. Osborne Corporate Director CGN, CR Ian Atkinson Corporate Director CGN, CR Ave G. Lethbridge Corporate Director A, H Una M. Power Corporate Director A, CR John A. Brough Corporate Director A, H Catherine McLeod-Seltzer Corporate Director CGN, CR J. Paul Rollinson President and Chief Executive Officer A Audit and Risk Committee CGN Corporate Governance and Nominating Committee CR H Corporate Responsibility and Technical Committee Human Resource and Compensation Committee Responsible Mining Mining responsibly is integral to our business strategy. This requires operating in accordance with the highest standards of ethical conduct, and responsibly managing our impacts while leveraging opportunities from our activities to generate sustainable long-term value in host communities. Safety is our first priority. In 2017, year-over-year improvements in reportable injury rates were overshadowed by a single employee fatality, the first at a Kinross operation since 2012. $2+ billion spent in host countries 97% of workforce from host countries met or exceeded environmental targets The local procurement, wages, and taxes generated by our operations are an important contribution to the economies of host countries Creating meaningful livelihoods for our employees is one of the most powerful impacts of our business Delivered on site-level targets for permitting, water management and concurrent reclamation Senior Leadership Team (left to right) Lauren M. Roberts Senior Vice-President and Chief Operating Officer J. Paul Rollinson President and Chief Executive Officer Paul B. Tomory Senior Vice-President and Chief Technical Officer Tony S. Giardini Executive Vice-President and Chief Financial Officer Gina M. Jardine Senior Vice-President, Human Resources Geoffrey P. Gold Executive Vice-President, Corporate Development, External Relations and Chief Legal Officer LEARN MORE ABOUT OUR HISTORY KINROSS ANNUAL REPORT 2017 05 06 K.4.232 Kinross2017AR_FA_Mar14rev22.pdf - p1 (March 15, 2018 20:35:52) DT Financial Summary (In millions except ounces, per share amounts, gold price and per ounce amounts) Revenue Net cash flow provided from operating activities Adjusted operating cash flow 1 Impairment, net of reversals 5 Net earnings (loss) attributable to common shareholders 5 Net earnings (loss) per share attributable to common shareholders 5 Basic Diluted Adjusted net earnings (loss) 1 Adjusted net earnings (loss) 1 per share Production cost of sales per equivalent ounce sold 1 All-in sustaining cost per gold equivalent ounce sold 1 Capital expenditures Average realized gold price per ounce 8 Attributable gold equivalent ounces produced 2 2017 3,303.0 951.6 1,166.7 21.5 445.4 0.36 0.35 178.7 0.14 669 954 897.6 1,260 $ $ $ $ $ $ $ $ $ $ $ $ $ 2016 3,472.0 1,099.2 926.7 139.6 (104.0) (0.08) (0.08) 93.0 0.08 712 984 633.8 1,249 $ $ $ $ $ $ $ $ $ $ $ $ $ 2015 3,052.2 831.6 786.6 699.0 (984.5) (0.86) (0.86) (91.0) (0.08) 696 975 610.0 1,159 $ $ $ $ $ $ $ $ $ $ $ $ $ 2,673,533 2,789,150 2,594,652 Financial Review Management’s Discussion and Analysis Management’s Responsibility for Financial Statements Report of Independent Registered Public Accounting Firm Consolidated Financial Statements and Notes Mineral Reserve and Mineral Resource Statement Summarized Five-Year Review Kinross Share Trading Data MDA 1 FS 1 FS 3 FS 5 68 73 73 KINROSS ANNUAL REPORT 2017 07 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   This  management's  discussion  and  analysis  ("MD&A"),  prepared  as  of  February  14,  2018,  relates  to  the  financial  condition  and  results   of  operations  of  Kinross  Gold  Corporation  together  with  its  wholly  owned  subsidiaries,  as  at  December  31,  2017  and  for  the  year  then   ended,  and  is  intended  to  supplement  and  complement  Kinross  Gold  Corporation’s  audited  annual  consolidated  financial  statements   for  the  year  ended   December  31,  2017  and  the  notes  thereto  (the  “financial  statements”).    Readers  are  cautioned  that  the  MD&A   contains   forward-­‐looking   statements   about   expected   future   events   and   financial   and   operating   performance   of   the   Company,   and   that   actual   events   may   vary   from   management's   expectations.     Readers   are   encouraged   to   read   the   Cautionary   Statement   on   Forward  Looking  Information  included  with  this  MD&A  and  to  consult  Kinross  Gold  Corporation's  financial  statements  for  2017  and   corresponding   notes   to   the   financial   statements   which   are   available   on   the   Company's   web   site   at   www.kinross.com   and   on   www.sedar.com.  The  financial  statements  and  MD&A  are  presented  in  U.S.  dollars.    The  financial  statements  have  been  prepared  in   accordance   with   International   Financial   Reporting   Standards   ("IFRS")   as   issued   by   the   International   Accounting   Standards   Board   (“IASB”).   This   discussion   addresses   matters   we   consider   important   for   an   understanding   of   our   financial   condition   and   results   of   operations  as  at  and  for  the  year  ended  December  31,  2017,  as  well  as  our  outlook.     This  MD&A  contains  forward-­‐looking  statements  and  should  be  read  in  conjunction  with  the  risk  factors  described  in  "Risk  Analysis"   and  in  the  “Cautionary  Statement  on  Forward-­‐Looking  Information”  on  pages  58  –  59  of  this  MD&A.    For  additional  discussion  of  risk   factors   please   refer   to   the   Company's   Annual   Information   Form   for   the   year   ended   December   31,   2016,   which   is   available   on   the   Company's   website   www.kinross.com   and   on   www.sedar.com.   In   certain   instances,   references   are   made   to   relevant   notes   in   the   financial  statements  for  additional  information.     Where  we  say  "we",  "us",  "our",  the  "Company"  or  "Kinross",  we  mean  Kinross  Gold  Corporation  or  Kinross  Gold  Corporation  and/or   one  or  more  or  all  of  its  subsidiaries,  as  it  may  apply.  Where  we  refer  to  the  "industry",  we  mean  the  gold  mining  industry.     1. DESCRIPTION  OF  THE  BUSINESS   Kinross   is   engaged   in   gold   mining   and   related   activities,   including   exploration   and   acquisition   of   gold-­‐bearing   properties,   the   extraction   and   processing   of   gold-­‐containing   ore,   and   reclamation   of   gold   mining   properties.   Kinross’   gold   production   and   exploration   activities   are   carried   out   principally   in   the   United  States,  the  Russian  Federation,  Brazil,  Chile,  Ghana,  Mauritania,  and   Canada.    Gold  is  produced  in  the  form  of  doré,  which  is  shipped  to  refineries  for  final  processing.    Kinross  also  produces  and  sells  a   quantity  silver.   The  profitability  and  operating  cash  flow  of  Kinross  are  affected  by  various  factors,  including  the  amount  of  gold  and  silver  produced,   the   market   prices   of   gold   and   silver,   operating   costs,   interest   rates,   regulatory   and   environmental   compliance,   the   level   of   exploration  activity  and  capital  expenditures,  general  and  administrative  costs,  and  other  discretionary  costs  and  activities.    Kinross   is  also  exposed  to  fluctuations  in  currency  exchange  rates,  political  risks,  and  varying  levels  of  taxation  that  can  impact  profitability   and  cash  flow.    Kinross  seeks  to  manage  the  risks  associated  with  its  business  operations;  however,  many  of  the  factors  affecting   these  risks  are  beyond  the  Company’s  control.   Commodity  prices  continue  to  be  volatile  as  economies  around  the  world  continue  to  experience  economic  challenges.    Volatility  in   the   price   of   gold   and   silver   impacts   the   Company's   revenue,   while   volatility   in   the   price   of   input   costs,   such   as   oil,   and   foreign   exchange   rates,   particularly   the   Brazilian   real,   Chilean   peso,   Russian   rouble,   Mauritanian   ouguiya,   Ghanaian   cedi,   and   Canadian   dollar,  may  have  an  impact  on  the  Company's  operating  costs  and  capital  expenditures.     Segment  Profile     Each  of  the  Company's  significant  operating  mines  is  generally  considered  to  be  a  separate  segment.  The  reportable  segments  are   those  operations  whose  operating  results  are  reviewed  by  the  chief  operating  decision  maker  to  make  decisions  about  resources  to   be  allocated  to  the  segment  and  assess  its  performance.   Operating  Segments Fort  Knox Round  Mountain Bald  Mountain Kettle  River-­‐Buckhorn Kupol(a) Paracatu   Maricunga Tasiast Chirano Operator Location Kinross Kinross Kinross Kinross Kinross Kinross Kinross Kinross Kinross USA USA USA USA Russian  Federation Brazil Chile Mauritania Ghana 1   Ownership  percentage  at  December  31, 2017 100% 100% 100% 100% 100% 100% 100% 100% 90% 2016 100% 100% 100% 100% 100% 100% 100% 100% 90% (a)  The  Kupol  segment  includes  the  Kupol  and  Dvoinoye  mines. 1 KINROSS ANNUAL REPORT MDA                     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Consolidated  Financial  and  Operating  Highlights   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Consolidated  Financial  Performance   Years  ended  December  31, 2017  vs.  2016 2016  vs.  2015 2017  vs.  2016   2017 2016 2015 Change %  Change  (e) Change   %  Change(e) 7% 5% 7% 6% 14% 8% (5%) (80%) 106% 89% 91% 91% nm nm 32% 18% 4% 8% 3% 2% 2% 0% 1% 2% 3% (in  millions,  except  ounces,  per  share  amounts  and    per  ounce  amounts) Operating  Highlights   Total  gold  equivalent  ounces  (a) Produced  (c) Sold  (c) Attributable  gold  equivalent  ounces  (a) Produced  (c) Sold  (c) Financial  Highlights   Metal  sales   Production  cost  of  sales 2,698,136 2,810,345 2,620,262 2,621,875 2,778,902 2,634,867 (112,209) (157,027) 2,673,533 2,789,150 2,594,652 (115,617) 2,596,754 2,758,306 2,608,870 (161,552) (4%) (6%) (4%) (6%) 190,083 144,035 194,498 149,436 $                 3,303.0 $               3,472.0 $               3,052.2 $                   (169.0) (5%) $                                   419.8 $                 1,757.4 $               1,983.8 $               1,834.8 $                   (226.4) (11%) $                                   149.0 Depreciation,  depletion  and  amortization $                           819.4 $                         855.0 $                         897.7 $                         (35.6) (4%) $                                     (42.7) Impairment,  net  of  reversals Operating  earnings  (loss) $                                 21.5 $                         139.6 $                         699.0 $                   (118.1) (85%) $                               (559.4) $                           336.5 $                               46.3 $                     (742.9) $                       290.2 Net  earnings  (loss)  attributable  to  common  shareholders $                           445.4 $                     (104.0) $                     (984.5) $                       549.4 Basic  earnings  (loss)  per  share  attributable  to  common  shareholders   $                                 0.36 $                           (0.08) $                           (0.86) $                             0.44 Diluted  earnings  (loss)  per  share  attributable  to  common  shareholders   Adjusted  net  earnings  (loss)  attributable  to  common  shareholders (b) Adjusted  net  earnings  (loss)  per  share  (b) Net  cash  flow  provided  from  operating  activities   Adjusted  operating  cash  flow  (b) Capital  expenditures   Average  realized  gold  price  per  ounce (d) Consolidated  production  cost  of  sales  per  equivalent  ounce (c)  sold(b) Attributable(a)  production  cost  of  sales  per  equivalent  ounce  (c)  sold(b) Attributable(a)  production  cost  of  sales  per  ounce  sold  on  a  by-­‐product  basis (b) Attributable(a)  all-­‐in  sustaining  cost  per  ounce  sold  on  a  by-­‐product  basis (b) Attributable(a)  all-­‐in  sustaining  cost  per  equivalent  ounce  (c)  sold  (b) Attributable(a)  all-­‐in  cost  per  ounce  sold  on  a  by-­‐product  basis (b) Attributable(a)  all-­‐in  cost  per  equivalent  ounce  (c)  sold  (b) $                                 $                           0.35 178.7 $                           $                               (0.08) 93.0 $                           $                           (0.86) (91.0) $                             $                             0.43 85.7 $                                 0.14 $                               0.08 $                           (0.08) $                             0.06 75% $                                         0.16 $                           951.6 $               1,099.2 $                         831.6 $                   (147.6) (13%) $                                   267.6 $                 1,166.7 $                         926.7 $                         786.6 $                       240.0 26% $                                   140.1 $                           897.6 $                         633.8 $                         610.0 $                       263.8 42% $                                         23.8 $                           1,260 $                         1,249 $                         1,159 $                                     11 1% $                                                 90 $                                   670 $                                 714 $                                 696 $                                   (44) (6%) $                                                 18 $                                   669 $                                 712 $                                 696 $                                   (43) (6%) $                                                 16 $                                   653 $                                 696 $                                 684 $                                   (43) (6%) $                                                 12 $                                   946 $                                 975 $                                 971 $                                   (29) (3%) $                                                       4 $                                   954 $                                 984 $                                 975 $                                   (30) (3%) $                                                       9 $                           $                           1,164 1,166 $                         $                         1,073 1,079 $                         $                         1,047 1,049 $                                     $                                     91 87 8% 8% $                                                 $                                                 26 30 nm nm nm $                                   789.2 $                                   880.5 $                                         0.78 nm 92% $                                         $                                   0.78 184.0 (a) (b) (c) (d) (e) "Total"  includes  100%  of  Chirano  production.    "Attributable"  includes  Kinross'  share  of  Chirano  (90%)  production.   The  definition  and  reconciliation  of  these  non-­‐GAAP  financial  measures  are  included  in  Section  11  of  this  document. "Gold  equivalent  ounces"  include  silver  ounces  produced  and  sold  converted  to  a  gold  equivalent  based  on  a  ratio  of  the  average  spot  market  prices  for  the  commodities  for  each   period.    The  ratio  for  2017  was  73.72:1  (2016  -­‐  72.95:1  and  2015  -­‐  73.92:1). Average  realized  gold  price  is  a  non-­‐GAAP  financial  measure  and  is  defined  in  Section  11  of  this  document. "nm"  means  not  meaningful. 2   KINROSS ANNUAL REPORT MDA 2 Kinross’  attributable  production  decreased  by  4%  compared  with  2016,  primarily  due  to  a  decrease  in  production  at  Kupol  due  to   lower  grades,  at  Paracatu  due  to  a  temporary  curtailment  as  a  result  of  lower  than  average  rainfall  in  the  area,  and  at  Maricunga  due   to  the  suspension  of  mining  and  crushing  activities  in  2016.  These  decreases  were  offset  by  higher  production  at  Bald  Mountain  as  a   result   of   more   ounces   recovered   from   the   heap   leach   pads   and   higher   grades,   as   well   as   at   Round   Mountain   and   Tasiast   due   to   higher  grades.   Metal   sales   decreased   by   5%   in   2017   compared   with   2016   due   to   a   decrease   in   gold   equivalent   ounces   sold,   slightly   offset   by   an   increase  in  average  metal  prices  realized.    The  average  realized  gold  price  increased  to  $1,260  per  ounce  in  2017  from  $1,249  per   ounce  in  2016.  Gold  equivalent  ounces  sold  in  2017  decreased  to  2,621,875  ounces  from  2,778,902  ounces  in  2016,  primarily  due  to   the  decrease  in  production  as  described  above.       Production   cost   of   sales   decreased   by   11%   compared   with   2016,   primarily   due   to   the   decrease   in   gold   equivalent   ounces   sold   as   described   above,   as   well   as   a   decrease   in   operating   waste   mined   at   Fort   Knox.   These   decreases   were   partially   offset   by   higher   production  cost  of  sales  at  Bald  Mountain  due  to  an  increase  in  gold  equivalent  ounces  sold.  The  decrease  in  production  cost  of  sales   resulted  in  a  6%  decrease  in  attributable  production  cost  of  sales  per  equivalent  ounce  sold  compared  with  2016.   During  2017,  depreciation,  depletion  and  amortization  decreased  by  4%  compared  with  2016,  primarily  due  to  the  decrease  in  gold   equivalent  ounces  sold  at  Kupol,  Paracatu  and  Maricunga.  This  decrease  was  slightly  offset  by  an  increase  in  depreciation,  depletion   and  amortization  at  Bald  Mountain  and  Round  Mountain  due  to  an  increase  in  gold  equivalent  ounces  sold,  as  well  as  at  Chirano  due   to  an  increase  in  gold  equivalent  ounces  sold  and  a  decrease  in  the  mineral  reserves  as  at  December  31,  2016.   At  December  31,  2017,  upon  completion  of  its  annual  assessment  of  the  carrying  value  of  its  Cash  Generating  Units  (“CGUs”),  the   Company  recorded  a  net,  after-­‐tax,  impairment  reversal  of  $62.1  million.  The  impairment  reversal  was  entirely  related  to  property,   plant   and   equipment   and   included   after-­‐tax   impairment   reversals   at   Tasiast   and   Fort   Knox   of   $142.9   million   and   $86.2   million,   respectively,  partially  offset  by  an  after-­‐tax  impairment  charge  at  Paracatu  of  $167.0  million.  The  impairment  reversals  at  Tasiast  and   Fort  Knox  were  mainly  due  to  an  increase  in  the  Company’s  short-­‐term  and  long-­‐term  gold  price  estimates,  as  well  as  Tasiast  Phase   Two  progressing  as  planned  and  additions  to  Fort  Knox’s  mineral  reserve  estimates.  The  impairment  charge  at  Paracatu  was  mainly  a   result  of  changes  in  the  fiscal  regime  in  Brazil  that  were  considered  in  the  cash  flow  analysis  used  to  assess  its  recoverable  amount.   The  impairment  charge  at  Paracatu  is  net  of  a  tax  recovery  of  $86.0  million  and  the  impairment  reversal  at  Fort  Knox  is  net  of  a  tax   expense   of   $2.4   million.   There   was   no   tax   impact   on   the   impairment   reversal   at   Tasiast.   During   2016,   the   Company   recorded   impairment   charges   at   Maricunga   of   $68.3   million   against   property,   plant   and   equipment   and   $71.3   million   against   metals   and   supplies  inventory  as  a  result  of  the  suspension  of  mining  and  crushing  activities  during  the  year.   Operating  earnings  increased  to  $336.5  million  in  2017  from  $46.3  million  in  2016.  The  change  in  operating  earnings  was  primarily   due  to  lower  impairment  charges  as  well  as  increased  margins  (metal  sales  less  production  cost  of  sales).       On  March  28,  2017,  the  Company  announced  that  it  had  entered  into  an  agreement  with  Goldcorp  Inc.  (“Goldcorp”)  to  sell  its  25%   interest  in  the  Cerro  Casale  project  and  its  100%  interest  in  the  Quebrada  Seca  exploration  project  in  Chile.  In  connection  with  the   sale,  the  Company  recorded  a  reversal  of  previously  recorded  impairment  charges  of  $97.0  million  during  the  three  months  ended   March   31,   2017   within   other   income   (expense).   On   June   9,   2017,   the   Company   completed   the   sale   and   recognized   a   gain   on   disposition  of  $12.7  million  in  other  income  (expense).   On   May   18,   2017,   the   Company   entered   into   an   agreement   with   White   Gold   Corp.   to   sell   its   100%   interest   in   the   White   Gold   exploration  project  in  the  Yukon  Territory.  On  June  14,  2017,  the  Company  completed  the  sale  and  recognized  a  loss  on  disposition   of  $1.7  million  in  other  income  (expense).   On  September  18,  2017,  the  Company  entered  into  an  agreement  with  Integra  Resources  Corp.  (“Integra”)  to  sell  its  100%  interest  in   the  DeLamar  reclamation  property  (“DeLamar”).  On  November  3,  2017,  the  Company  completed  the  sale  and  recognized  a  gain  on   disposition  of  $44.2  million  in  other  income  (expense).   During  2017,  net  earnings  attributable  to  common  shareholders  were  $445.4  million,  or  $0.36  per  share,  compared  with  a  net  loss   attributable   to   common   shareholders   of   $104.0   million,   or   $0.08   per   share,   in   2016.     The   change   was   primarily   a   result   of   the   increase  in  operating  earnings,  the  impairment  reversal  recorded  in  relation  to  the  sale  of  Cerro  Casale,  and  gains  recognized  upon   disposition  of  DeLamar,  Cerro  Casale  and  Quebrada  Seca,  as  described  above.  In  addition,  an  income  tax  recovery  of  $23.2  million   3                                                                                                                                                                                                                                                                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Consolidated  Financial  and  Operating  Highlights   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Consolidated  Financial  Performance   Years  ended  December  31, 2017  vs.  2016 2016  vs.  2015 2017  vs.  2016   (in  millions,  except  ounces,  per  share  amounts  and    per  ounce  amounts) Operating  Highlights   Total  gold  equivalent  ounces  (a) Attributable  gold  equivalent  ounces  (a) Produced  (c) Sold  (c) Produced  (c) Sold  (c) Financial  Highlights   Metal  sales   Production  cost  of  sales Impairment,  net  of  reversals Operating  earnings  (loss) 2017 2016 2015 Change %  Change  (e) Change   %  Change(e) 2,698,136 2,810,345 2,620,262 2,621,875 2,778,902 2,634,867 (112,209) (157,027) 2,673,533 2,789,150 2,594,652 (115,617) 2,596,754 2,758,306 2,608,870 (161,552) (4%) (6%) (4%) (6%) 190,083 144,035 194,498 149,436 $                 3,303.0 $               3,472.0 $               3,052.2 $                   (169.0) (5%) $                                   419.8 $                 1,757.4 $               1,983.8 $               1,834.8 $                   (226.4) (11%) $                                   149.0 Depreciation,  depletion  and  amortization $                           819.4 $                         855.0 $                         897.7 $                         (35.6) (4%) $                                     (42.7) $                                 21.5 $                         139.6 $                         699.0 $                   (118.1) (85%) $                               (559.4) $                           336.5 $                               46.3 $                     (742.9) $                       290.2 nm nm nm nm $                                   789.2 $                                   880.5 $                                         0.78 $                                         0.78 Net  earnings  (loss)  attributable  to  common  shareholders $                           445.4 $                     (104.0) $                     (984.5) $                       549.4 Basic  earnings  (loss)  per  share  attributable  to  common  shareholders   $                                 0.36 $                           (0.08) $                           (0.86) $                             0.44 Diluted  earnings  (loss)  per  share  attributable  to  common  shareholders   $                                 0.35 $                           (0.08) $                           (0.86) $                             0.43 Adjusted  net  earnings  (loss)  attributable  to  common  shareholders (b) $                           178.7 $                               93.0 $                           (91.0) $                             85.7 92% $                                   184.0 Adjusted  net  earnings  (loss)  per  share  (b) $                                 0.14 $                               0.08 $                           (0.08) $                             0.06 75% $                                         0.16 Net  cash  flow  provided  from  operating  activities   $                           951.6 $               1,099.2 $                         831.6 $                   (147.6) (13%) $                                   267.6 Adjusted  operating  cash  flow  (b) Capital  expenditures   Average  realized  gold  price  per  ounce (d) Consolidated  production  cost  of  sales  per  equivalent  ounce (c)  sold(b) Attributable(a)  production  cost  of  sales  per  equivalent  ounce  (c)  sold(b) $                 1,166.7 $                         926.7 $                         786.6 $                       240.0 26% $                                   140.1 $                           897.6 $                         633.8 $                         610.0 $                       263.8 42% $                                         23.8 $                           1,260 $                         1,249 $                         1,159 $                                     11 1% $                                                 90 $                                   670 $                                 714 $                                 696 $                                   (44) (6%) $                                                 18 $                                   669 $                                 712 $                                 696 $                                   (43) (6%) $                                                 16 Attributable(a)  production  cost  of  sales  per  ounce  sold  on  a  by-­‐product  basis (b) $                                   653 $                                 696 $                                 684 $                                   (43) (6%) $                                                 12 Attributable(a)  all-­‐in  sustaining  cost  per  ounce  sold  on  a  by-­‐product  basis (b) $                                   946 $                                 975 $                                 971 $                                   (29) (3%) $                                                       4 Attributable(a)  all-­‐in  sustaining  cost  per  equivalent  ounce  (c)  sold  (b) Attributable(a)  all-­‐in  cost  per  ounce  sold  on  a  by-­‐product  basis (b) Attributable(a)  all-­‐in  cost  per  equivalent  ounce  (c)  sold  (b) $                                   954 $                                 984 $                                 975 $                                   (30) (3%) $                                                       9 $                           1,164 $                         1,073 $                         1,047 $                                     91 $                           1,166 $                         1,079 $                         1,049 $                                     87 8% 8% $                                                 26 $                                                 30 "Total"  includes  100%  of  Chirano  production.    "Attributable"  includes  Kinross'  share  of  Chirano  (90%)  production.   The  definition  and  reconciliation  of  these  non-­‐GAAP  financial  measures  are  included  in  Section  11  of  this  document. (a) (b) (c) "Gold  equivalent  ounces"  include  silver  ounces  produced  and  sold  converted  to  a  gold  equivalent  based  on  a  ratio  of  the  average  spot  market  prices  for  the  commodities  for  each   period.    The  ratio  for  2017  was  73.72:1  (2016  -­‐  72.95:1  and  2015  -­‐  73.92:1). (d) Average  realized  gold  price  is  a  non-­‐GAAP  financial  measure  and  is  defined  in  Section  11  of  this  document. (e) "nm"  means  not  meaningful. 7% 5% 7% 6% 14% 8% (5%) (80%) 106% 89% 91% 91% nm nm 32% 18% 4% 8% 3% 2% 2% 0% 1% 2% 3% Kinross’  attributable  production  decreased  by  4%  compared  with  2016,  primarily  due  to  a  decrease  in  production  at  Kupol  due  to   lower  grades,  at  Paracatu  due  to  a  temporary  curtailment  as  a  result  of  lower  than  average  rainfall  in  the  area,  and  at  Maricunga  due   to  the  suspension  of  mining  and  crushing  activities  in  2016.  These  decreases  were  offset  by  higher  production  at  Bald  Mountain  as  a   result   of   more   ounces   recovered   from   the   heap   leach   pads   and   higher   grades,   as   well   as   at   Round   Mountain   and   Tasiast   due   to   higher  grades.   Metal   sales   decreased   by   5%   in   2017   compared   with   2016   due   to   a   decrease   in   gold   equivalent   ounces   sold,   slightly   offset   by   an   increase  in  average  metal  prices  realized.    The  average  realized  gold  price  increased  to  $1,260  per  ounce  in  2017  from  $1,249  per   ounce  in  2016.  Gold  equivalent  ounces  sold  in  2017  decreased  to  2,621,875  ounces  from  2,778,902  ounces  in  2016,  primarily  due  to   the  decrease  in  production  as  described  above.       Production   cost   of   sales   decreased   by   11%   compared   with   2016,   primarily   due   to   the   decrease   in   gold   equivalent   ounces   sold   as   described   above,   as   well   as   a   decrease   in   operating   waste   mined   at   Fort   Knox.   These   decreases   were   partially   offset   by   higher   production  cost  of  sales  at  Bald  Mountain  due  to  an  increase  in  gold  equivalent  ounces  sold.  The  decrease  in  production  cost  of  sales   resulted  in  a  6%  decrease  in  attributable  production  cost  of  sales  per  equivalent  ounce  sold  compared  with  2016.   During  2017,  depreciation,  depletion  and  amortization  decreased  by  4%  compared  with  2016,  primarily  due  to  the  decrease  in  gold   equivalent  ounces  sold  at  Kupol,  Paracatu  and  Maricunga.  This  decrease  was  slightly  offset  by  an  increase  in  depreciation,  depletion   and  amortization  at  Bald  Mountain  and  Round  Mountain  due  to  an  increase  in  gold  equivalent  ounces  sold,  as  well  as  at  Chirano  due   to  an  increase  in  gold  equivalent  ounces  sold  and  a  decrease  in  the  mineral  reserves  as  at  December  31,  2016.   At  December  31,  2017,  upon  completion  of  its  annual  assessment  of  the  carrying  value  of  its  Cash  Generating  Units  (“CGUs”),  the   Company  recorded  a  net,  after-­‐tax,  impairment  reversal  of  $62.1  million.  The  impairment  reversal  was  entirely  related  to  property,   plant   and   equipment   and   included   after-­‐tax   impairment   reversals   at   Tasiast   and   Fort   Knox   of   $142.9   million   and   $86.2   million,   respectively,  partially  offset  by  an  after-­‐tax  impairment  charge  at  Paracatu  of  $167.0  million.  The  impairment  reversals  at  Tasiast  and   Fort  Knox  were  mainly  due  to  an  increase  in  the  Company’s  short-­‐term  and  long-­‐term  gold  price  estimates,  as  well  as  Tasiast  Phase   Two  progressing  as  planned  and  additions  to  Fort  Knox’s  mineral  reserve  estimates.  The  impairment  charge  at  Paracatu  was  mainly  a   result  of  changes  in  the  fiscal  regime  in  Brazil  that  were  considered  in  the  cash  flow  analysis  used  to  assess  its  recoverable  amount.   The  impairment  charge  at  Paracatu  is  net  of  a  tax  recovery  of  $86.0  million  and  the  impairment  reversal  at  Fort  Knox  is  net  of  a  tax   expense   of   $2.4   million.   There   was   no   tax   impact   on   the   impairment   reversal   at   Tasiast.   During   2016,   the   Company   recorded   impairment   charges   at   Maricunga   of   $68.3   million   against   property,   plant   and   equipment   and   $71.3   million   against   metals   and   supplies  inventory  as  a  result  of  the  suspension  of  mining  and  crushing  activities  during  the  year.   Operating  earnings  increased  to  $336.5  million  in  2017  from  $46.3  million  in  2016.  The  change  in  operating  earnings  was  primarily   due  to  lower  impairment  charges  as  well  as  increased  margins  (metal  sales  less  production  cost  of  sales).       On  March  28,  2017,  the  Company  announced  that  it  had  entered  into  an  agreement  with  Goldcorp  Inc.  (“Goldcorp”)  to  sell  its  25%   interest  in  the  Cerro  Casale  project  and  its  100%  interest  in  the  Quebrada  Seca  exploration  project  in  Chile.  In  connection  with  the   sale,  the  Company  recorded  a  reversal  of  previously  recorded  impairment  charges  of  $97.0  million  during  the  three  months  ended   March   31,   2017   within   other   income   (expense).   On   June   9,   2017,   the   Company   completed   the   sale   and   recognized   a   gain   on   disposition  of  $12.7  million  in  other  income  (expense).   On   May   18,   2017,   the   Company   entered   into   an   agreement   with   White   Gold   Corp.   to   sell   its   100%   interest   in   the   White   Gold   exploration  project  in  the  Yukon  Territory.  On  June  14,  2017,  the  Company  completed  the  sale  and  recognized  a  loss  on  disposition   of  $1.7  million  in  other  income  (expense).   On  September  18,  2017,  the  Company  entered  into  an  agreement  with  Integra  Resources  Corp.  (“Integra”)  to  sell  its  100%  interest  in   the  DeLamar  reclamation  property  (“DeLamar”).  On  November  3,  2017,  the  Company  completed  the  sale  and  recognized  a  gain  on   disposition  of  $44.2  million  in  other  income  (expense).   During  2017,  net  earnings  attributable  to  common  shareholders  were  $445.4  million,  or  $0.36  per  share,  compared  with  a  net  loss   attributable   to   common   shareholders   of   $104.0   million,   or   $0.08   per   share,   in   2016.     The   change   was   primarily   a   result   of   the   increase  in  operating  earnings,  the  impairment  reversal  recorded  in  relation  to  the  sale  of  Cerro  Casale,  and  gains  recognized  upon   disposition  of  DeLamar,  Cerro  Casale  and  Quebrada  Seca,  as  described  above.  In  addition,  an  income  tax  recovery  of  $23.2  million   2   3 KINROSS ANNUAL REPORT MDA 3                                                                                                                                                                                                                                                                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   was   recorded   in   2017,   compared   with   an   income   tax   expense   of   $49.6   million   in   2016.   The   $23.2   million   income   tax   recovery   recognized  in  2017  includes  a  net  tax  recovery  of  $83.6  million  related  to  the  impairment  charge  at  Paracatu  and  the  impairment   reversal   at   Fort   Knox,   and   an   estimated   net   benefit   of   $93.4   million   due   to   the   enactment   of   U.S.   Tax   Reform   legislation   on   December  22,  2017.  The  estimated  net  benefit  includes  a  benefit  of  $124.4  million  in  respect  of  the  collectability  of  the  Alternative   Minimum  Tax  (“AMT”)  credit,  which  is  partially  offset  by  the  write-­‐down  of  net  deferred  tax  assets  to  reflect  the  reduction  in  the   U.S.  corporate  tax  rate  from  35%  to  21%  beginning  January  1,  2018.  Further  guidance  on  the  implementation  and  application  of  the   U.S.  Tax  Reform  legislation  will  be  forthcoming  in  regulations  to  be   issued  by  the  Department  of  Treasury,  legislation  or  guidance   from   the   states   in   which   the   Company   operates   and   directions   from   the   Office   of   Management   and   Budget.   Such   legislation,   regulations,  directions  and  additional  guidance  may  require  changes  to  the  estimated  net  benefit  recorded  and  the  impact  of  such   changes  will  be  accounted  for  in  the  period  in  which  the  legislation,  regulations,  directions,  and  additional  guidance  are  enacted  or   released  by  the  relevant  authorities.  The  $49.6  million  income  tax  expense  recognized  in  2016  included  a  $65.1  million  recovery  due   to   re-­‐measurement   of   deferred   tax   assets   and   liabilities   as   a   result   of   fluctuations   in   foreign   exchange   rates   with   respect   to   the   Brazilian  real  and  the  Russian  rouble,  $32.0  million  of  expense  due  to  a  proposal  to  reassess  taxes  which  was  received  in  the  second   quarter  of  2016  and  a  tax  benefit  of  $27.7  million  realized  by  the  Company  as  a  result  of  the  acquisition  of  Bald  Mountain  and  the   remaining  50%  of  Round  Mountain.  In  addition,  tax  expense  decreased  due  to  differences  in  the  level  of  income  in  the  Company’s   operating  jurisdictions  from  one  period  to  the  next.  Kinross'  combined  federal  and  provincial  statutory  tax  rate  for  2017  was  26.5%   (2016  –  26.5%).   Adjusted   net   earnings   attributable   to   common   shareholders   was   $178.7   million,   or   $0.14   per   share,   for   2017   compared   with   adjusted  net  earnings  attributable  to  common  shareholders  of  $93.0  million,  or  $0.08  per  share,  in  2016.    The  increase  in  adjusted   net  earnings  was  mainly  due  to  the  increase  in  margins  described  above.   lower  than  the  carrying  amount,  an  impairment  charge  of  $68.3  million  was  recorded  against  property,  plant  and  equipment.  The   Company  also  recorded  an  inventory  impairment  charge  of  $71.3  million  related  to  metals  and  supplies  inventory  as  a  result  of  the   suspension.   During   2015,   the   Company   recorded   after-­‐tax   impairment   charges   of   $430.2   million   related   to   property   plant   and   equipment,  and  impairment  charges  of  $259.5  million  related  to  inventory  and  other  assets.   Operating   earnings   increased   to   $46.3   million   in   2016   from   an   operating   loss   of   $742.9   million   in   the   same   period   of   2015.   The   change  in  earnings  was  primarily  due  to  lower  impairment  charges  as  well  as  increased  margins  (metal  sales  less  production  cost  of   sales).       During   2016,   net   loss   attributable   to   common   shareholders   was   $104.0   million,   or   $0.08   per   share,   compared   with   a   net   loss   attributable   to   common   shareholders   of   $984.5   million,   or   $0.86   per   share,   in   2015.     The   change   was   primarily   a   result   of   the   increase  in  operating  earnings  described  above.  In  addition,  an  income  tax  expense  of  $49.6  million  was  recorded  in  2016,  compared   with  an  income  tax  expense  of  $141.7  million  in  2015.  The  $49.6  million  income  tax  expense  recognized  in  2016  included  a  $65.1   million   recovery   due   to   re-­‐measurement   of   deferred   tax   assets   and   liabilities   as   a   result   of   fluctuations   in   foreign   exchange   rates   with  respect  to  the  Brazilian  real  and  the  Russian  rouble,  $32.0  million  of  expense  due  to  a  proposal  to  reassess  taxes  which  was   received  in  the  second  quarter  of  2016  and  a  tax  benefit  of  $27.7  million  realized  by  the  Company  as  a  result  of  the  acquisition  of   Bald  Mountain  and  the  remaining  50%  of  Round  Mountain.  The  $141.7  million  tax  expense  in  2015  included  a  $30.3  million  recovery   due  to  impairment  charges  and  $132.9  million  of  expense  due  to  re-­‐measurements  of  deferred  tax  assets  and  liabilities,  as  a  result  of   significant  fluctuations  in  foreign  exchange  rates  with  respect  to  the  Brazilian  real  and  the  Russian  rouble.  In  addition,  tax  expense   decreased  due  to  differences  in  the  level  of  income  in  the  Company’s  operating  jurisdictions  from  one  period  to  the  next.  Kinross'   combined  federal  and  provincial  statutory  tax  rate  for  2016  was  26.5%  (2015  –  26.5%).   During  2017,  net  cash  flow  provided  from  operating  activities  decreased   to  $951.6  million  from  $1,099.2  million  in  2016  primarily   due  to  less  favourable  working  capital  movements  and  higher  taxes  paid,  partially  offset  by  higher  margins.  Adjusted  operating  cash   flow  increased  to  $1,166.7  million  from  $926.7  million  in  2016,  primarily  due  to  the  increase  in  margins.     Adjusted  net  earnings  attributable  to  common  shareholders  was  $93.0  million,  or  $0.08  per  share,  for  2016  compared  with  adjusted   net  loss  attributable  to  common  shareholders  of  $91.0  million,  or  $0.08  per  share,  in  2015.    The  increase  in  adjusted  net  earnings   was  mainly  due  to  the  increase  in  margins  described  above.   Capital  expenditures  increased  by  42%  in  2017  compared  with  2016,  primarily  due  to  increased  spending  at  Tasiast,  Bald  Mountain   and  Fort  Knox,  offset  by  lower  spending  at  Kupol.   During  2016,  net  cash  flow  provided  from  operating  activities  increased  to  $1,099.2  million  from  $831.6  million  in  2015  and  adjusted   operating  cash  flow  increased  to  $926.7  million  from  $786.6  million  in  2015,  both  primarily  due  to  the  increase  in  margins.     During  2017,  attributable  all-­‐in  sustaining  cost  per  equivalent  ounce  sold  and  per  ounce  sold  on  a  by-­‐product  basis  decreased  from   2016  largely  due  to  lower  production  cost  of  sales.  Attributable  all-­‐in  cost  per  equivalent  ounce  sold  and  per  ounce  sold  on  a  by-­‐ product  basis  increased  compared  with  2016,  primarily  due  to  an  increase  in  non-­‐sustaining  capital  expenditures.     Capital   expenditures   increased   by   4%   in   2016   compared   with   2015,   primarily   due   to   increased   spending   resulting   from   the   acquisition  of  Bald  Mountain  and  the  remaining  50%  of  Round  Mountain  as  well  as  at  Kupol,  Tasiast  and  Chirano,  partially  offset  by   lower  spending  at  Fort  Knox,  Maricunga  and  the  Corporate  and  other  segment.     2016  vs.  2015   Kinross’   attributable   production   increased   by   7%   compared   with   2015,   primarily   due   to   the   acquisition   of   Bald   Mountain   and   the   remaining   50%   of   Round   Mountain.     These   increases   were   partially   offset   by   lower   production   at   Chirano   due   to   a   decrease   in   grades,  at  Tasiast  due  to  lower  recovery  from  the  dump  leach  pads  and  the   six  week  temporary  suspension  of  operations,  and  at   Maricunga  as  a  result  of  the  suspension  of  mining  activities  in  2016.     Metal  sales  increased  by  14%  in  2016  compared  with  2015  due  to  an  increase  in  metal  prices  realized  and  gold  equivalent  ounces   sold.    The  average  realized  gold  price  increased  to  $1,249  per  ounce  in  2016  from  $1,159  per  ounce  in  2015.  Gold  equivalent  ounces   sold  in  2016  increased  to  2,778,902  ounces  from  2,634,867  ounces  in  2015,  primarily  due  to  the  increase  in  production  described   above.       Production   cost   of   sales   increased   by   8%   compared   with   2015,   primarily   due   to   the   increase   in   gold   equivalent   ounces   sold   as   described  above,  as  well  as  an  increase  in  operating  waste  mined  at  Fort  Knox,  partially  offset  by  lower  costs  at  Maricunga,  Tasiast   and  Kupol  due  to  decreases  in  gold  equivalent  ounces  sold,  lower  fuel  and  labour  costs  at  Kupol,  and  favourable  foreign  exchange   movements  at  Paracatu  resulting  from  the  effectiveness  of  the  Company’s  hedge  program.    The  increase  in  production  cost  of  sales   resulted  in  higher  attributable  production  cost  of  sales  per  equivalent  ounce  sold  compared  with  2015.   During   2016,   depreciation,   depletion   and   amortization   decreased   by   5%   compared   with   2015,   primarily   due   to   a   decrease   in   the   depreciable   asset   base   at   Fort   Knox   and   Kupol.   Additionally,   depreciation   was   lower   at   Chirano   related   to   an   increase   in   mineral   reserves  at  December  31,  2015  and  a  decrease  in  gold  equivalent  ounces  sold.  The  decreases  were  partially  offset  by  an  increase  in   the  depreciable  asset  base  as  a  result  of  the  acquisition  of  Bald  Mountain  and  the  remaining  50%  of  Round  Mountain.       At   September   30,   2016,   the   Company   identified   the   suspension   of   mining   at   Maricunga   as   an   indication   of   impairment   and   performed  an  impairment  assessment  to  determine  the  recoverable  amount  of  the  Maricunga  CGU.  As  the  recoverable  amount  was   4   KINROSS ANNUAL REPORT MDA 4 During   2016,   attributable   all-­‐in   sustaining   cost   per   equivalent   ounce   sold   and   per   ounce   sold   on   a   by-­‐product   basis   remained   comparable   with   2015.   Attributable   all-­‐in   cost   per   equivalent   ounce   sold   and   per   ounce   sold   on   a   by-­‐product   basis   increased   compared  with  2015,  primarily  due  to  an  increase  in  non-­‐sustaining  capital  and  reclamation  expenditures.   Mineral  Reserves1     Kinross’  total  estimated  proven  and  probable  gold  reserves  at  year-­‐end  2017  were  approximately  25.9  million  ounces.    The  decrease   of  5.1  million  ounces  in  estimated  gold  reserves  compared  to  year-­‐end  2016  was  mainly  a  result  of  the  sale  of  Cerro  Casale,  which   accounted  for  5.8  million  ounces  in  estimated  mineral  reserves.   Proven  and  probable  silver  reserves  at  year-­‐end  2017  were  estimated  at  approximately  52.6  million  ounces,  a  net  decrease  of  15.2   million   ounces   compared   with   year-­‐end   2016,   primarily   due   to   the   sale   of   Cerro   Casale,   which   accounted   for   14.7   million   silver   ounces.   1  For  details  concerning  mineral  reserve  and  mineral  resource  estimates,  refer  to  the  Mineral  Reserves  and  Mineral  Resources  tables  and  notes  in  the  Company's  news   release  filed  with  Canadian  and  U.S.  regulators  on  February  14,  2018. 5                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   was   recorded   in   2017,   compared   with   an   income   tax   expense   of   $49.6   million   in   2016.   The   $23.2   million   income   tax   recovery   recognized  in  2017  includes  a  net  tax  recovery  of  $83.6  million  related  to  the  impairment  charge  at  Paracatu  and  the  impairment   reversal   at   Fort   Knox,   and   an   estimated   net   benefit   of   $93.4   million   due   to   the   enactment   of   U.S.   Tax   Reform   legislation   on   December  22,  2017.  The  estimated  net  benefit  includes  a  benefit  of  $124.4  million  in  respect  of  the  collectability  of  the  Alternative   Minimum  Tax  (“AMT”)  credit,  which  is  partially  offset  by  the  write-­‐down  of  net  deferred  tax  assets  to  reflect  the  reduction  in  the   U.S.  corporate  tax  rate  from  35%  to  21%  beginning  January  1,  2018.  Further  guidance  on  the  implementation  and  application  of  the   U.S.  Tax  Reform  legislation  will  be  forthcoming  in  regulations  to  be   issued  by  the  Department  of  Treasury,  legislation  or  guidance   from   the   states   in   which   the   Company   operates   and   directions   from   the   Office   of   Management   and   Budget.   Such   legislation,   regulations,  directions  and  additional  guidance  may  require  changes  to  the  estimated  net  benefit  recorded  and  the  impact  of  such   changes  will  be  accounted  for  in  the  period  in  which  the  legislation,  regulations,  directions,  and  additional  guidance  are  enacted  or   released  by  the  relevant  authorities.  The  $49.6  million  income  tax  expense  recognized  in  2016  included  a  $65.1  million  recovery  due   to   re-­‐measurement   of   deferred   tax   assets   and   liabilities   as   a   result   of   fluctuations   in   foreign   exchange   rates   with   respect   to   the   Brazilian  real  and  the  Russian  rouble,  $32.0  million  of  expense  due  to  a  proposal  to  reassess  taxes  which  was  received  in  the  second   quarter  of  2016  and  a  tax  benefit  of  $27.7  million  realized  by  the  Company  as  a  result  of  the  acquisition  of  Bald  Mountain  and  the   remaining  50%  of  Round  Mountain.  In  addition,  tax  expense  decreased  due  to  differences  in  the  level  of  income  in  the  Company’s   operating  jurisdictions  from  one  period  to  the  next.  Kinross'  combined  federal  and  provincial  statutory  tax  rate  for  2017  was  26.5%   (2016  –  26.5%).   Adjusted   net   earnings   attributable   to   common   shareholders   was   $178.7   million,   or   $0.14   per   share,   for   2017   compared   with   adjusted  net  earnings  attributable  to  common  shareholders  of  $93.0  million,  or  $0.08  per  share,  in  2016.    The  increase  in  adjusted   net  earnings  was  mainly  due  to  the  increase  in  margins  described  above.   lower  than  the  carrying  amount,  an  impairment  charge  of  $68.3  million  was  recorded  against  property,  plant  and  equipment.  The   Company  also  recorded  an  inventory  impairment  charge  of  $71.3  million  related  to  metals  and  supplies  inventory  as  a  result  of  the   suspension.   During   2015,   the   Company   recorded   after-­‐tax   impairment   charges   of   $430.2   million   related   to   property   plant   and   equipment,  and  impairment  charges  of  $259.5  million  related  to  inventory  and  other  assets.   Operating   earnings   increased   to   $46.3   million   in   2016   from   an   operating   loss   of   $742.9   million   in   the   same   period   of   2015.   The   change  in  earnings  was  primarily  due  to  lower  impairment  charges  as  well  as  increased  margins  (metal  sales  less  production  cost  of   sales).       During   2016,   net   loss   attributable   to   common   shareholders   was   $104.0   million,   or   $0.08   per   share,   compared   with   a   net   loss   attributable   to   common   shareholders   of   $984.5   million,   or   $0.86   per   share,   in   2015.     The   change   was   primarily   a   result   of   the   increase  in  operating  earnings  described  above.  In  addition,  an  income  tax  expense  of  $49.6  million  was  recorded  in  2016,  compared   with  an  income  tax  expense  of  $141.7  million  in  2015.  The  $49.6  million  income  tax  expense  recognized  in  2016  included  a  $65.1   million   recovery   due   to   re-­‐measurement   of   deferred   tax   assets   and   liabilities   as   a   result   of   fluctuations   in   foreign   exchange   rates   with  respect  to  the  Brazilian  real  and  the  Russian  rouble,  $32.0  million  of  expense  due  to  a  proposal  to  reassess  taxes  which  was   received  in  the  second  quarter  of  2016  and  a  tax  benefit  of  $27.7  million  realized  by  the  Company  as  a  result  of  the  acquisition  of   Bald  Mountain  and  the  remaining  50%  of  Round  Mountain.  The  $141.7  million  tax  expense  in  2015  included  a  $30.3  million  recovery   due  to  impairment  charges  and  $132.9  million  of  expense  due  to  re-­‐measurements  of  deferred  tax  assets  and  liabilities,  as  a  result  of   significant  fluctuations  in  foreign  exchange  rates  with  respect  to  the  Brazilian  real  and  the  Russian  rouble.  In  addition,  tax  expense   decreased  due  to  differences  in  the  level  of  income  in  the  Company’s  operating  jurisdictions  from  one  period  to  the  next.  Kinross'   combined  federal  and  provincial  statutory  tax  rate  for  2016  was  26.5%  (2015  –  26.5%).   During  2017,  net  cash  flow  provided  from  operating  activities  decreased   to  $951.6  million  from  $1,099.2  million  in  2016  primarily   due  to  less  favourable  working  capital  movements  and  higher  taxes  paid,  partially  offset  by  higher  margins.  Adjusted  operating  cash   flow  increased  to  $1,166.7  million  from  $926.7  million  in  2016,  primarily  due  to  the  increase  in  margins.     Adjusted  net  earnings  attributable  to  common  shareholders  was  $93.0  million,  or  $0.08  per  share,  for  2016  compared  with  adjusted   net  loss  attributable  to  common  shareholders  of  $91.0  million,  or  $0.08  per  share,  in  2015.    The  increase  in  adjusted  net  earnings   was  mainly  due  to  the  increase  in  margins  described  above.   Capital  expenditures  increased  by  42%  in  2017  compared  with  2016,  primarily  due  to  increased  spending  at  Tasiast,  Bald  Mountain   and  Fort  Knox,  offset  by  lower  spending  at  Kupol.   During  2016,  net  cash  flow  provided  from  operating  activities  increased  to  $1,099.2  million  from  $831.6  million  in  2015  and  adjusted   operating  cash  flow  increased  to  $926.7  million  from  $786.6  million  in  2015,  both  primarily  due  to  the  increase  in  margins.     During  2017,  attributable  all-­‐in  sustaining  cost  per  equivalent  ounce  sold  and  per  ounce  sold  on  a  by-­‐product  basis  decreased  from   2016   largely  due  to  lower  production  cost  of  sales.  Attributable  all-­‐in  cost  per  equivalent  ounce  sold  and  per  ounce  sold  on  a  by-­‐ product  basis  increased  compared  with  2016,  primarily  due  to  an  increase  in  non-­‐sustaining  capital  expenditures.     Capital   expenditures   increased   by   4%   in   2016   compared   with   2015,   primarily   due   to   increased   spending   resulting   from   the   acquisition  of  Bald  Mountain  and  the  remaining  50%  of  Round  Mountain  as  well  as  at  Kupol,  Tasiast  and  Chirano,  partially  offset  by   lower  spending  at  Fort  Knox,  Maricunga  and  the  Corporate  and  other  segment.     2016  vs.  2015   Kinross’   attributable   production   increased   by   7%   compared   with   2015,   primarily   due   to   the   acquisition   of   Bald   Mountain   and   the   remaining   50%   of   Round   Mountain.     These   increases   were   partially   offset   by   lower   production   at   Chirano   due   to   a   decrease   in   grades,  at  Tasiast  due  to  lower  recovery  from  the  dump  leach  pads  and  the   six  week  temporary  suspension  of  operations,  and  at   Maricunga  as  a  result  of  the  suspension  of  mining  activities  in  2016.     Metal  sales  increased  by  14%  in  2016  compared  with  2015  due  to  an  increase  in  metal  prices  realized  and  gold  equivalent  ounces   sold.    The  average  realized  gold  price  increased  to  $1,249  per  ounce  in  2016  from  $1,159  per  ounce  in  2015.  Gold  equivalent  ounces   sold  in  2016  increased  to  2,778,902  ounces  from  2,634,867  ounces  in  2015,  primarily  due  to  the  increase  in  production  described   above.       Production   cost   of   sales   increased   by   8%   compared   with   2015,   primarily   due   to   the   increase   in   gold   equivalent   ounces   sold   as   described  above,  as  well  as  an  increase  in  operating  waste  mined  at  Fort  Knox,  partially  offset  by  lower  costs  at  Maricunga,  Tasiast   and  Kupol  due  to  decreases  in  gold  equivalent  ounces  sold,  lower  fuel  and  labour  costs  at  Kupol,  and  favourable  foreign  exchange   movements  at  Paracatu  resulting  from  the  effectiveness  of  the  Company’s  hedge  program.    The  increase  in  production  cost  of  sales   resulted  in  higher  attributable  production  cost  of  sales  per  equivalent  ounce  sold  compared  with  2015.   During   2016,   depreciation,   depletion   and   amortization   decreased   by   5%   compared   with   2015,   primarily   due   to   a   decrease   in   the   depreciable   asset   base   at   Fort   Knox   and   Kupol.   Additionally,   depreciation   was   lower   at   Chirano   related   to   an   increase   in   mineral   reserves  at  December  31,  2015  and  a  decrease  in  gold  equivalent  ounces  sold.  The  decreases  were  partially  offset  by  an  increase  in   the  depreciable  asset  base  as  a  result  of  the  acquisition  of  Bald  Mountain  and  the  remaining  50%  of  Round  Mountain.       At   September   30,   2016,   the   Company   identified   the   suspension   of   mining   at   Maricunga   as   an   indication   of   impairment   and   performed  an  impairment  assessment  to  determine  the  recoverable  amount  of  the  Maricunga  CGU.  As  the  recoverable  amount  was   4   During   2016,   attributable   all-­‐in   sustaining   cost   per   equivalent   ounce   sold   and   per   ounce   sold   on   a   by-­‐product   basis   remained   comparable   with   2015.   Attributable   all-­‐in   cost   per   equivalent   ounce   sold   and   per   ounce   sold   on   a   by-­‐product   basis   increased   compared  with  2015,  primarily  due  to  an  increase  in  non-­‐sustaining  capital  and  reclamation  expenditures.   Mineral  Reserves1     Kinross’  total  estimated  proven  and  probable  gold  reserves  at  year-­‐end  2017  were  approximately  25.9  million  ounces.    The  decrease   of  5.1  million  ounces  in  estimated  gold  reserves  compared  to  year-­‐end  2016  was  mainly  a  result  of  the  sale  of  Cerro  Casale,  which   accounted  for  5.8  million  ounces  in  estimated  mineral  reserves.   Proven  and  probable  silver  reserves  at  year-­‐end  2017  were  estimated  at  approximately  52.6  million  ounces,  a  net  decrease  of  15.2   million   ounces   compared   with   year-­‐end   2016,   primarily   due   to   the   sale   of   Cerro   Casale,   which   accounted   for   14.7   million   silver   ounces.   1  For  details  concerning  mineral  reserve  and  mineral  resource  estimates,  refer  to  the  Mineral  Reserves  and  Mineral  Resources  tables  and  notes  in  the  Company's  news   release  filed  with  Canadian  and  U.S.  regulators  on  February  14,  2018. 5 KINROSS ANNUAL REPORT MDA 5                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   2. IMPACT  OF  KEY  ECONOMIC  TRENDS     Price  of  Gold     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Source:  Bloomberg   The   price   of   gold   is   the   largest   single   factor   in   determining   profitability   and   cash   flow   from   operations,   therefore,   the   financial   performance  of  the  Company  has  been,  and  is  expected  to  be  closely  linked  to  the  price  of  gold.    Historically,  the  price  of  gold  has   been   subject   to   volatile   price   movements   over   short   periods   of   time   and   is   affected   by   numerous   macroeconomic   and   industry   factors  that  are  beyond  the  Company’s  control.    Major  influences  on  the  gold  price  include  currency  exchange  rate  fluctuations  and   the  relative  strength  of  the  U.S.  dollar,  the  supply  of  and  demand  for  gold  and  macroeconomic  factors  such  as  the  level  of  interest   rates  and  inflation  expectations.    During  2017,  the  price  of  gold  fluctuated  between  a  low  of  $1,150  per  ounce  in  January  to  a  high  of   $1,358  per  ounce  in  September.    The  average  price  for  the  year  based  on  the  London  Bullion  Market  Association  PM  Fix  was  $1,257   per  ounce,  a  $6  per  ounce  increase  over  the  2016  average  price  of  $1,251  per  ounce.    Major  influences  on  the  gold  price  in  2017   included   the   weakening   of   the   U.S.   dollar,   negative   interest   rate   policies   in   Japan   and   Europe   and   strong   equity   markets.     Gold   weakened   with   the   U.S.   Federal   Reserve   raising   interest   rates   by   75   basis   points   but   rebounded   after   the   interest   rate   announcements.    Investors  buying  gold  exchange-­‐traded  funds  (“ETF”)  increased  during  2017.    In  2017,  gold  ETF  holdings  increased   throughout  the  year,  ending  the  year  near  the  2016  peak  holdings.    Gold  was  also  impacted  by  the  continued  uncertainty  over  Brexit   and  the  political  climate  in  the  U.S.    Source:  London  Bullion  Marketing  Association  London  PM  Fix   1  Average  realized  gold  price  is  a  non-­‐GAAP  financial  measure  and  is  defined  in  Section  11  of  this  document.   During  2017,  the  Company  realized  an  average  gold  price  of  $1,260  per  ounce  compared  to  the  average  PM  Fix  of  $1,257  per  ounce.     6   KINROSS ANNUAL REPORT MDA 6 7                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   2. IMPACT  OF  KEY  ECONOMIC  TRENDS     Price  of  Gold     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Source:  Bloomberg   The   price   of   gold   is   the   largest   single   factor   in   determining   profitability   and   cash   flow   from   operations,   therefore,   the   financial   performance  of  the  Company  has  been,  and  is  expected  to  be  closely  linked  to  the  price  of  gold.    Historically,  the  price  of  gold  has   been   subject   to   volatile   price   movements   over   short   periods   of   time   and   is   affected   by   numerous   macroeconomic   and   industry   factors  that  are  beyond  the  Company’s  control.    Major  influences  on  the  gold  price  include  currency  exchange  rate  fluctuations  and   the  relative  strength  of  the  U.S.  dollar,  the  supply  of  and  demand  for  gold  and  macroeconomic  factors  such  as  the  level  of  interest   rates  and  inflation  expectations.    During  2017,  the  price  of  gold  fluctuated  between  a  low  of  $1,150  per  ounce  in  January  to  a  high  of   $1,358  per  ounce  in  September.    The  average  price  for  the  year  based  on  the  London  Bullion  Market  Association  PM  Fix  was  $1,257   per  ounce,  a  $6  per  ounce  increase  over  the  2016  average  price  of  $1,251  per  ounce.    Major  influences  on  the  gold  price  in  2017   included   the   weakening   of   the   U.S.   dollar,   negative   interest   rate   policies   in   Japan   and   Europe   and   strong   equity   markets.     Gold   weakened   with   the   U.S.   Federal   Reserve   raising   interest   rates   by   75   basis   points   but   rebounded   after   the   interest   rate   announcements.    Investors  buying  gold  exchange-­‐traded  funds  (“ETF”)  increased  during  2017.    In  2017,  gold  ETF  holdings  increased   throughout  the  year,  ending  the  year  near  the  2016  peak  holdings.    Gold  was  also  impacted  by  the  continued  uncertainty  over  Brexit   and  the  political  climate  in  the  U.S.    Source:  London  Bullion  Marketing  Association  London  PM  Fix   1  Average  realized  gold  price  is  a  non-­‐GAAP  financial  measure  and  is  defined  in  Section  11  of  this  document.   During  2017,  the  Company  realized  an  average  gold  price  of  $1,260  per  ounce  compared  to  the  average  PM  Fix  of  $1,257  per  ounce.     6   7 KINROSS ANNUAL REPORT MDA 7                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Gold  Supply  and  Demand  Fundamentals     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Source:  GFMS  Gold  Survey  2017  Q4  Update   Total  gold  supply  decreased  by  approximately  2.6%  in  2017  relative  to  2016,  largely  due  to  an  increase  in  producer  hedging.    Global   gold  mine  production  increased  by  1.5%  offset  by  a  decrease  of  4.2%  in  supply  of  recycled  gold.    Mine  production  and  recycled  gold   remain  the  dominant  sources  of  gold  supply,  and  in  2017  they  represented  approximately  70%  and  28%  of  total  supply,  respectively.     Central  banks  have  not  been  a  source  of  supply  to  the  market,  but  have  rather  been  net  buyers,  as  noted  below.   Source:  GFMS  2017  Gold  Survey  Q4  Update   Physical   demand   rebounded   from   a   seven   year   low   and   increased   by   approximately   17%   in   2017   relative   to   2016.     Fabrication   demand   is   estimated   to   have   increased   by   19%   in   2017   relative   to   2016,   mainly   due   to   higher   demand   in   China   and   India.   Bar   hoarding  increased  by  approximately  6%  in  2017.  Purchases  from  central  banks  increased  by  36%  during  the  year,  due  to  purchases   from  Russia  and  Turkey. 8   KINROSS ANNUAL REPORT MDA 8 9               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Gold  Supply  and  Demand  Fundamentals     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Source:  GFMS  Gold  Survey  2017  Q4  Update   Total  gold  supply  decreased  by  approximately  2.6%  in  2017  relative  to  2016,  largely  due  to  an  increase  in  producer  hedging.    Global   gold  mine  production  increased  by  1.5%  offset  by  a  decrease  of  4.2%  in  supply  of  recycled  gold.    Mine  production  and  recycled  gold   remain  the  dominant  sources  of  gold  supply,  and  in  2017  they  represented  approximately  70%  and  28%  of  total  supply,  respectively.     Central  banks  have  not  been  a  source  of  supply  to  the  market,  but  have  rather  been  net  buyers,  as  noted  below.   Source:  GFMS  2017  Gold  Survey  Q4  Update   Physical   demand   rebounded   from   a   seven   year   low   and   increased   by   approximately   17%   in   2017   relative   to   2016.     Fabrication   demand   is   estimated   to   have   increased   by   19%   in   2017   relative   to   2016,   mainly   due   to   higher   demand   in   China   and   India.   Bar   hoarding  increased  by  approximately  6%  in  2017.  Purchases  from  central  banks  increased  by  36%  during  the  year,  due  to  purchases   from  Russia  and  Turkey. 8   9 KINROSS ANNUAL REPORT MDA 9               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Cost  Sensitivity   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Currency  Fluctuations   The  Company’s  profitability  is  subject  to  industry  wide  cost  pressures  on  development  and  operating  costs  with  respect  to  labour,   energy,  capital  expenditures  and  consumables  in  general.    Since  mining  is  generally  an  energy  intensive  activity,  especially  in  open   pit   mining,   energy   prices   can   have   a   significant   impact   on   operations.     The   cost   of   fuel   as   a   percentage   of   operating   costs   varies   amongst  the  Company’s  mines,  and  overall,  operations  have  experienced  fuel  price  increases  in  the  second  half  of  2017,  reflecting   OPEC’s   decision   to   continue   production   cuts   and   increased   global   demand.     Kinross   manages   its   exposure   to   energy   costs   by   entering,  from  time  to  time,  into  various  hedge  positions  –  refer  to  Section  6  Liquidity  and  Capital  Resources  for  details.                    Source:  Bloomberg At   the   Company’s   non-­‐U.S.   mining   operations   and   exploration   activities,   which   are   primarily   located   in   Brazil,   Chile,   Ghana,   Mauritania,   the   Russian   Federation,   and   Canada,   a   portion   of   operating   costs   and   capital   expenditures   are   denominated   in   their   respective  local  currencies.    Generally,  as  the  U.S.  dollar  strengthens,  these  currencies  weaken,  and  as  the  U.S.  dollar  weakens,  these   foreign  currencies  strengthen.    These  currencies  were  subject  to  high  market  volatility  over  the  course  of  the  year.    Approximately   61%  of  the  Company’s  expected  attributable  production  in  2018  is  forecast  to  come  from  operations  outside  the  U.S.  and  costs  will   continue  to  be  exposed  to  foreign  exchange  rate  movements.    In  order  to  manage  this  risk,  the  Company  uses  currency  hedges  for   certain  foreign  currency  exposures  –  refer  to  Section  6  Liquidity  and  Capital  Resources  for  details.     Source:  Bloomberg   In  order  to  mitigate  the  impact  of  higher  consumable  prices,  the  Company  continues  to  focus  on  continuous  improvement,  both  by   promoting  more  efficient  use  of  materials  and  supplies,  and  by  pursuing  more  advantageous  pricing,  whilst  increasing  performance   and  without  compromising  operational  integrity.       10   KINROSS ANNUAL REPORT MDA 10 11                     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Cost  Sensitivity   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Currency  Fluctuations   The  Company’s  profitability  is  subject  to  industry  wide  cost  pressures  on  development  and  operating  costs  with  respect  to  labour,   energy,  capital  expenditures  and  consumables  in  general.    Since  mining  is  generally  an  energy  intensive  activity,  especially  in  open   pit   mining,   energy   prices   can   have   a   significant   impact   on   operations.     The   cost   of   fuel   as   a   percentage   of   operating   costs   varies   amongst  the  Company’s  mines,  and  overall,  operations  have  experienced  fuel  price  increases  in  the  second  half  of  2017,  reflecting   OPEC’s   decision   to   continue   production   cuts   and   increased   global   demand.     Kinross   manages   its   exposure   to   energy   costs   by   entering,  from  time  to  time,  into  various  hedge  positions  –  refer  to  Section  6  Liquidity  and  Capital  Resources  for  details.                    Source:  Bloomberg At   the   Company’s   non-­‐U.S.   mining   operations   and   exploration   activities,   which   are   primarily   located   in   Brazil,   Chile,   Ghana,   Mauritania,   the   Russian   Federation,   and   Canada,   a   portion   of   operating   costs   and   capital   expenditures   are   denominated   in   their   respective  local  currencies.    Generally,  as  the  U.S.  dollar  strengthens,  these  currencies  weaken,  and  as  the  U.S.  dollar  weakens,  these   foreign  currencies  strengthen.    These  currencies  were  subject  to  high  market  volatility  over  the  course  of  the  year.    Approximately   61%  of  the  Company’s  expected  attributable  production  in  2018  is  forecast  to  come  from  operations  outside  the  U.S.  and  costs  will   continue  to  be  exposed  to  foreign  exchange  rate  movements.    In  order  to  manage  this  risk,  the  Company  uses  currency  hedges  for   certain  foreign  currency  exposures  –  refer  to  Section  6  Liquidity  and  Capital  Resources  for  details.     Source:  Bloomberg   In  order  to  mitigate  the  impact  of  higher  consumable  prices,  the  Company  continues  to  focus  on  continuous  improvement,  both  by   promoting  more  efficient  use  of  materials  and  supplies,  and  by  pursuing  more  advantageous  pricing,  whilst  increasing  performance   and  without  compromising  operational  integrity.       10   11 KINROSS ANNUAL REPORT MDA 11                     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   3. OUTLOOK   The  forward-­‐looking  information  contained  in  this  section  is  subject  to  the  risk  factors  and  assumptions  contained  in  the  Cautionary   Statement  on  Forward-­‐Looking  Information  included  with  this  MD&A  and  the  risk  factors  set  out  in  Section  10  –  Risk  Analysis.   Operational  Outlook   In  2018,  Kinross  expects  to  produce  2.5  million  gold  equivalent  ounces  (+/-­‐  5%)  from  its  operations  and  expects  to  be  at  or  slightly   above   the   same   level   of   production   over   the   next   three   years.   The   forecast   decrease   compared   with   full-­‐year   2017   production   is   mainly  a  result  of  mine  sequencing  at  several  operations,  including  anticipated  lower  grades  at  Kupol  and  Dvoinoye,  the  closure  of   Kettle  River-­‐Buckhorn  and  the  suspension  of  mining  at  Maricunga,  partially  offset  by  an   expected  production  increase  in  the  West   Africa  region.  The  production  guidance  has  taken  into  consideration  the  potential  for  a  temporary  curtailment  of  mill  operations  at   Paracatu  due  to  the  possibility  of  seasonal  rainfall  shortages  in  the  area.  Production  is  expected  to  be  higher  in  the  second  half  of   2018  than  the  first  half  mainly  as  a  result  of  expected  production  from  the  Tasiast  Phase  One  expansion.       Production   cost   of   sales   per   gold   equivalent   ounce   is   expected   to   be   $730   (+/-­‐   5%)   for   2018.   The   expected   increase   for   2018   compared  with  full-­‐year  2017  production  cost  of  sales  per  ounce  is  mainly  as  a  result  of  mine  sequencing,  with  anticipated  lower   grades   at   Dvoinoye   and   Round   Mountain   and   an   increase   in   operating   waste   mined   at   Fort   Knox   and   Tasiast.   Kinross   expects   production  cost  of  sales  per  gold  equivalent  ounce  to  decline  slightly  in  2019  and  2020  as  lower  cost  production  comes  online.   The  Company  has  forecast  an  all-­‐in  sustaining  cost  of  $975  (+/-­‐  5%)  per  ounce  sold  on  both  a  gold  equivalent  and  by-­‐product  basis   for  2018,  which  is  largely  in  line  with  full-­‐year  2017  all-­‐in  sustaining  cost  per  ounce.     Material  assumptions  used  to  forecast  2018  production  costs  are:  a  gold  price  of  $1,200  per  ounce,  a  silver  price  of  $16  per  ounce,   an  oil  price  of  $55  per  barrel,  and  foreign  exchange  rates  of  3.25  Brazilian  reais  to  the  U.S.  dollar,  1.25  Canadian  dollars  to  the  U.S.   dollar,   60   Russian   roubles   to   the   U.S.   dollar,   650   Chilean   pesos   to   the   U.S.   dollar,   4.00   Ghanaian   cedi   to   the   U.S.   dollar,   33   Mauritanian  ouguiya  to  the  U.S.  dollar,  and  1.10  U.S.  dollars  to  the  Euro.  Taking  into  account  existing  currency  and  oil  hedges,  a  10%   change  in  foreign  currency  exchange  rates  would  be  expected  to  result  in  an  approximate  $17  impact  on  our  production  cost  of  sales   per  ounce,  and  specific  to  the  Russian  rouble  and  Brazilian  real,  a  10%  change  in  the  exchange  rates  would  be  expected  to  result  in   an  impact  of  approximately  $19  and  $38  on  Russian  and  Brazilian  production  cost  of  sales  per  ounce,  respectively.    A  $10  per  barrel   change  in  the  price  of  oil  would  be  expected  to  result  in  an  approximate  $3  impact  on  our  production  cost  of  sales  per  ounce,  and  a   $100  change  in  the  price  of  gold  would  be  expected  to  result  in  an  approximate  $4  impact  on  our  production  cost  of  sales  per  ounce   as  a  result  of  a  change  in  royalties.   Total   capital   expenditures   for   2018   are   forecast   to   be   approximately   $1,075   million   (+/-­‐   5%)   (including   capitalized   interest   of   approximately  $40  million).  Of  this  amount,  sustaining  capital  expenditures  are  expected  to  be  approximately  $355  million,  and  non-­‐ sustaining  capital  of  approximately  $680  million  for  the  Tasiast  expansion  project,  the  Round  Mountain  Phase  W  project,  and  other   development  projects  and  studies.     The   2018   forecast   for   exploration   is   approximately   $75   million,   none   of   which   is   expected   to   be   capitalized,   with   2018   overhead   (general   and   administrative   and   business   development   expenses)   forecast   to   be   approximately   $165   million,   both   of   which   are   consistent  with  last  year’s  guidance.     Other  operating  costs  expected  to  be  incurred  in  2018  are  approximately  $100  million,  which  includes  approximately  $50  million  of   care  and  maintenance  costs  in  Chile.   Based   on   our   assumed   gold   price   and   other   inputs,   net   income   tax   expense   is   expected   to   be   $35   million   and   taxes   paid   are   expected   to   be   $70 million,   with   the   expense   increasing   at   15%   of   any   profit   resulting   from   higher   gold   prices   and   taxes   paid   increasing  at  a  lower  rate  of  7%  as  a  result  of  the  realization  of  the  U.S.  AMT  credit.     Depreciation,  depletion  and  amortization  is  forecast  to  be  approximately  $300  per  gold  equivalent  ounce.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   4. PROJECT  UPDATES  AND  NEW  DEVELOPMENTS   Tasiast  Phase  One  and  Phase  Two  expansion   The  Tasiast  Phase  One  project  development  is  progressing  well,  and  continues  to  be   on  time  and  on  budget,  with  full  commercial   production   expected   by   the   end   of   June.   Plant   construction   is   now   93%   complete   and   the   remaining   work   is   now   focused   on   electrical,  instrumentation  and  controls  installations.  Mechanical  installation  of  the  primary  crusher,  conveyor,  stockpile  and  carbon-­‐ in-­‐leach   (“CIL”)   plant   modifications,   which   includes   the   cyclones,   three   leach   tanks   and   elution   circuit,   are   now   substantially   complete.  Commissioning  of  the  primary  crusher  and  CIL  plant  is  expected  to  begin  in  late  February,  and  the  SAG  mill  in  April.   The   Tasiast   Phase   Two   project   is   proceeding   on   schedule,   as   Phase   One   nears   completion.   Project   and   construction   teams   are   expected  to  transition  from  Phase  One  to  Phase  Two  development  to  establish  continuity  between  projects.  Overall  engineering  is   now  33%  complete  and  procurement  is  progressing  well,  with  the  power  plant  and  EPCM  contracts  now  awarded.  Early  works  for   the  ball  mill  and  power  plant  are  expected  to  commence  in  the  second  quarter  of  2018.  Phase  Two  is  expected  to  begin  commercial   production  in  the  third  quarter  of  2020.   The   Company   is   considering   an   asset   level   financing   for   Tasiast   and   has   initiated   discussions   to   better   understand   the   level   of   interest  from  potential  primary  lenders.  Once  initial  feedback  has  been  received,  the  Company  will  decide  whether  to  proceed  and   identify   additional   potential   lenders   in   order   to   complete   the   financing.     Also   in   connection   with   Tasiast,   the   Company   has   completed  a  political  risk  insurance  policy  agreement  with  the  Multilateral  Investment  Guarantee  Agency,  a  member  of  the  World   The  Vantage  Complex  project  is  proceeding  on  schedule,  with  initial  construction  work  now  well  underway  and  engineering  more   than  80%  complete.  Permitting  is  proceeding  as  planned  and contractors  for  more  than  half  the  scope  of  the  project  work  have  been   selected.  Commissioning  for  the  proposed  heap  leach  pad  and  processing  facilities  is  expected  to  commence  in  the  first  quarter  of   At  the  Moroshka  satellite  deposit  in  Russia,  located  approximately  four  kilometres  east  of  Kupol,  development  of  the  twin  declines   continues  to  proceed  on  schedule  and  on  budget.  Mining  of  high-­‐grade  ore  at  Moroshka  is  expected  to  commence  in  the  second  half   Bank.   Bald  Mountain  Vantage  Complex   2019.   Moroshka  project   of  2018  for  processing  in  the  Kupol  mill. Round  Mountain  Phase  W   Stripping,   initial   construction   and   site   preparation   activities   commenced   ahead   of   schedule   in   late   2017   after   the   receipt   of   the   Decision  Record  and  other  approvals  from  the  U.S.  Bureau  of  Land  Management.  The  construction  management  team  for  Phase  W   has   been   mobilized   to   site   and   earthworks   have   begun   in   the   project   area.   Detailed   engineering   is   progressing   on   schedule,   with   heap   leach   engineering   complete   and   mine   infrastructure   and   processing   facility   engineering   approximately   50%   complete.   Procurement   activities   are   underway   for   critical   long   lead   items   and   tracking   according   to   plan.   State   permitting   is   proceeding   as   planned,  with  all  major  permits  now  received.  The  Phase  W  project  remains  on  schedule,  with  initial  low  grade  ore  expected  to  be   encountered  in  mid-­‐2019.   Fort  Knox  Gilmore   Permitting  activities  have  commenced  and  feasibility  study  activities  are  ongoing  for  the  Gilmore  project.  The  feasibility  study,  which   is  expected  to  be  completed  in  mid-­‐2018,  is  assessing  a  multi-­‐phase  layback  of  the  Fort  Knox  pit  and  the  construction  of  a  new  heap   leach   pad.   The   Company   gained   mineral   rights   to   the   Gilmore   land,   which   is   located   immediately   west   of   the   Fort   Knox   pit,   on   December   12,   2017.   As  a   result,   the   Company   added   2.1  million  gold  ounces  in  estimated   measured   and   indicated   resources   and   300,000  ounces  in  estimated  inferred  resources.  This  was  offset  by  a  conversion  of  254,000  ounces  of  mineral  resources  to  mineral   reserves,  for  a  net  addition  of  1.8  million  ounces  to  measured  and  indicated  resource  estimates.  An  additional  199,000  ounces  was   added  to  estimated  inferred  resources  from  exploration  and  engineering  for  a  total  increase  of  499,000  ounces  to  inferred  resource   estimates.   12   KINROSS ANNUAL REPORT MDA 12 13                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   3. OUTLOOK   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   4. PROJECT  UPDATES  AND  NEW  DEVELOPMENTS   The  forward-­‐looking  information  contained  in  this  section  is  subject  to  the  risk  factors  and  assumptions  contained  in  the  Cautionary   Tasiast  Phase  One  and  Phase  Two  expansion   Statement  on  Forward-­‐Looking  Information  included  with  this  MD&A  and  the  risk  factors  set  out  in  Section  10  –  Risk  Analysis.   Operational  Outlook   In  2018,  Kinross  expects  to  produce  2.5  million  gold  equivalent  ounces  (+/-­‐  5%)  from  its  operations  and  expects  to  be  at  or  slightly   above   the   same   level   of   production   over   the   next   three   years.   The   forecast   decrease   compared   with   full-­‐year   2017   production   is   mainly  a  result  of  mine  sequencing  at  several  operations,  including  anticipated  lower  grades  at  Kupol  and  Dvoinoye,  the  closure  of   Kettle  River-­‐Buckhorn  and  the  suspension  of  mining  at  Maricunga,  partially  offset  by  an   expected  production  increase  in  the  West   Africa  region.  The  production  guidance  has  taken  into  consideration  the  potential  for  a  temporary  curtailment  of  mill  operations  at   Paracatu  due  to  the  possibility  of  seasonal  rainfall  shortages  in  the  area.  Production  is  expected  to  be  higher  in  the  second  half  of   2018  than  the  first  half  mainly  as  a  result  of  expected  production  from  the  Tasiast  Phase  One  expansion.       Production   cost   of   sales   per   gold   equivalent   ounce   is   expected   to   be   $730   (+/-­‐   5%)   for   2018.   The   expected   increase   for   2018   compared  with  full-­‐year  2017  production  cost  of  sales  per  ounce  is  mainly  as  a  result  of  mine  sequencing,  with  anticipated  lower   grades   at   Dvoinoye   and   Round   Mountain   and   an   increase   in   operating   waste   mined   at   Fort   Knox   and   Tasiast.   Kinross   expects   production  cost  of  sales  per  gold  equivalent  ounce  to  decline  slightly  in  2019  and  2020  as  lower  cost  production  comes  online.   The  Company  has  forecast  an  all-­‐in  sustaining  cost  of  $975  (+/-­‐  5%)  per  ounce  sold  on  both  a  gold  equivalent  and  by-­‐product  basis   for  2018,  which  is  largely  in  line  with  full-­‐year  2017  all-­‐in  sustaining  cost  per  ounce.     Material  assumptions  used  to  forecast  2018  production  costs  are:  a  gold  price  of  $1,200  per  ounce,  a  silver  price  of  $16  per  ounce,   an  oil  price  of  $55  per  barrel,  and  foreign  exchange  rates  of  3.25  Brazilian  reais  to  the  U.S.  dollar,  1.25  Canadian  dollars  to  the  U.S.   dollar,   60   Russian   roubles   to   the   U.S.   dollar,   650   Chilean   pesos   to   the   U.S.   dollar,   4.00   Ghanaian   cedi   to   the   U.S.   dollar,   33   Mauritanian  ouguiya  to  the  U.S.  dollar,  and  1.10  U.S.  dollars  to  the  Euro.  Taking  into  account  existing  currency  and  oil  hedges,  a  10%   change  in  foreign  currency  exchange  rates  would  be  expected  to  result  in  an  approximate  $17  impact  on  our  production  cost  of  sales   per  ounce,  and  specific  to  the  Russian  rouble  and  Brazilian  real,  a  10%  change  in  the  exchange  rates  would  be  expected  to  result  in   an  impact  of  approximately  $19  and  $38  on  Russian  and  Brazilian  production  cost  of  sales  per  ounce,  respectively.    A  $10  per  barrel   change  in  the  price  of  oil  would  be  expected  to  result  in  an  approximate  $3  impact  on  our  production  cost  of  sales  per  ounce,  and  a   $100  change  in  the  price  of  gold  would  be  expected  to  result  in  an  approximate  $4  impact  on  our  production  cost  of  sales  per  ounce   as  a  result  of  a  change  in  royalties.   Total   capital   expenditures   for   2018   are   forecast   to   be   approximately   $1,075   million   (+/-­‐   5%)   (including   capitalized   interest   of   approximately  $40  million).  Of  this  amount,  sustaining  capital  expenditures  are  expected  to  be  approximately  $355  million,  and  non-­‐ sustaining  capital  of  approximately  $680  million  for  the  Tasiast  expansion  project,  the  Round  Mountain  Phase  W  project,  and  other   development  projects  and  studies.     The   2018   forecast   for   exploration   is   approximately   $75   million,   none   of   which   is   expected   to   be   capitalized,   with   2018   overhead   (general   and   administrative   and   business   development   expenses)   forecast   to   be   approximately   $165   million,   both   of   which   are   consistent  with  last  year’s  guidance.     care  and  maintenance  costs  in  Chile.   Other  operating  costs  expected  to  be  incurred  in  2018  are  approximately  $100  million,  which  includes  approximately  $50  million  of   Based   on   our   assumed   gold   price   and   other   inputs,   net   income   tax   expense   is   expected   to   be   $35   million   and   taxes   paid   are   expected   to   be   $70 million,   with   the   expense   increasing   at   15%   of   any   profit   resulting   from   higher   gold   prices   and   taxes   paid   increasing  at  a  lower  rate  of  7%  as  a  result  of  the  realization  of  the  U.S.  AMT  credit.     Depreciation,  depletion  and  amortization  is  forecast  to  be  approximately  $300  per  gold  equivalent  ounce.   The  Tasiast  Phase  One  project  development  is  progressing  well,  and  continues  to  be   on  time  and  on  budget,  with  full  commercial   production   expected   by   the   end   of   June.   Plant   construction   is   now   93%   complete   and   the   remaining   work   is   now   focused   on   electrical,  instrumentation  and  controls  installations.  Mechanical  installation  of  the  primary  crusher,  conveyor,  stockpile  and  carbon-­‐ in-­‐leach   (“CIL”)   plant   modifications,   which   includes   the   cyclones,   three   leach   tanks   and   elution   circuit,   are   now   substantially   complete.  Commissioning  of  the  primary  crusher  and  CIL  plant  is  expected  to  begin  in  late  February,  and  the  SAG  mill  in  April.   The   Tasiast   Phase   Two   project   is   proceeding   on   schedule,   as   Phase   One   nears   completion.   Project   and   construction   teams   are   expected  to  transition  from  Phase  One  to  Phase  Two  development  to  establish  continuity  between  projects.  Overall  engineering  is   now  33%  complete  and  procurement  is  progressing  well,  with  the  power  plant  and  EPCM  contracts  now  awarded.  Early  works  for   the  ball  mill  and  power  plant  are  expected  to  commence  in  the  second  quarter  of  2018.  Phase  Two  is  expected  to  begin  commercial   production  in  the  third  quarter  of  2020.   The   Company   is   considering   an   asset   level   financing   for   Tasiast   and   has   initiated   discussions   to   better   understand   the   level   of   interest  from  potential  primary  lenders.  Once  initial  feedback  has  been  received,  the  Company  will  decide  whether  to  proceed  and   identify   additional   potential   lenders   in   order   to   complete   the   financing.     Also   in   connection   with   Tasiast,   the   Company   has   completed  a  political  risk  insurance  policy  agreement  with  the  Multilateral  Investment  Guarantee  Agency,  a  member  of  the  World   Bank.   Bald  Mountain  Vantage  Complex   The  Vantage  Complex  project  is  proceeding  on  schedule,  with  initial  construction  work  now  well  underway  and  engineering  more   than  80%  complete.  Permitting  is  proceeding  as  planned  and contractors  for  more  than  half  the  scope  of  the  project  work  have  been   selected.  Commissioning  for  the  proposed  heap  leach  pad  and  processing  facilities  is  expected  to  commence  in  the  first  quarter  of   2019.   Moroshka  project   At  the  Moroshka  satellite  deposit  in  Russia,  located  approximately  four  kilometres  east  of  Kupol,  development  of  the  twin  declines   continues  to  proceed  on  schedule  and  on  budget.  Mining  of  high-­‐grade  ore  at  Moroshka  is  expected  to  commence  in  the  second  half   of  2018  for  processing  in  the  Kupol  mill. Round  Mountain  Phase  W   Stripping,   initial   construction   and   site   preparation   activities   commenced   ahead   of   schedule   in   late   2017   after   the   receipt   of   the   Decision  Record  and  other  approvals  from  the  U.S.  Bureau  of  Land  Management.  The  construction  management  team  for  Phase  W   has   been   mobilized   to   site   and   earthworks   have   begun   in   the   project   area.   Detailed   engineering   is   progressing   on   schedule,   with   heap   leach   engineering   complete   and   mine   infrastructure   and   processing   facility   engineering   approximately   50%   complete.   Procurement   activities   are   underway   for   critical   long   lead   items   and   tracking   according   to   plan.   State   permitting   is   proceeding   as   planned,  with  all  major  permits  now  received.  The  Phase  W  project  remains  on  schedule,  with  initial  low  grade  ore  expected  to  be   encountered  in  mid-­‐2019.   Fort  Knox  Gilmore   Permitting  activities  have  commenced  and  feasibility  study  activities  are  ongoing  for  the  Gilmore  project.  The  feasibility  study,  which   is  expected  to  be  completed  in  mid-­‐2018,  is  assessing  a  multi-­‐phase  layback  of  the  Fort  Knox  pit  and  the  construction  of  a  new  heap   leach   pad.   The   Company   gained   mineral   rights   to   the   Gilmore   land,   which   is   located   immediately   west   of   the   Fort   Knox   pit,   on   December   12,   2017.   As  a   result,   the   Company   added   2.1  million  gold  ounces  in  estimated   measured   and   indicated   resources   and   300,000  ounces  in  estimated  inferred  resources.  This  was  offset  by  a  conversion  of  254,000  ounces  of  mineral  resources  to  mineral   reserves,  for  a  net  addition  of  1.8  million  ounces  to  measured  and  indicated  resource  estimates.  An  additional  199,000  ounces  was   added  to  estimated  inferred  resources  from  exploration  and  engineering  for  a  total  increase  of  499,000  ounces  to  inferred  resource   estimates.   12   13 KINROSS ANNUAL REPORT MDA 13                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Tasiast  Sud  project     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Disposition  of  Interest  in  White  Gold   The  Tasiast  Sud  pre-­‐feasibility  study  (“PFS”)  is  proceeding  as  planned  and  is  expected  to  be  completed  in  the  second  half  of  2018.   The  PFS  is  contemplating  a  potential  dump  leach  operation  that  would  combine  materials  from  multiple  deposits  in  the  area,  and   the   trucking   of   high   grade   ore   to   the   Tasiast   mill,   located   approximately   10   kilometres   north   of   the   project.   The   Company   added   approximately  820,000  ounces  to  inferred  mineral  resource  estimates  at  Tasiast  Sud  in  2017.   La  Coipa  restart  project   Compania  Minera  Mantos  de  Oro  (“MDO”),  a  subsidiary  of  the  Company,  currently  holds  a  50%  ownership  interest  in  the  Phase  7   deposit  through  its  50%  ownership  of  Minera  La  Coipa  (“MLC”),  with  the  remaining  50%  held  by  Salmones  de  Chile  Alimentos  S.A.   (“SDCA”).    Pursuant  to  an  agreement  signed  on  February  2,  2018,  MDO,  MLC  and  SDCA  have  agreed,  among  other  things,  to  spin  out   the  Phase  7  concessions  into  a  new  company  and  MDO  has  agreed  to  purchase  SDCA’s  50%  interest  in  such  company  in  exchange  for   payments  to  SDCA  totaling  $65  million  ($35  million  on  closing  and  $30  million  on  or  before  January  31,  2019).    Following  completion   of  the  transaction,  MDO  will  have  a  100%  ownership  interest  in  the  Phase  7  deposit.  The  transaction  is  subject  to  certain  conditions   and  is  expected  to  close  within  90  days.   In  2017,  approximately  844,000  ounces  of  gold  and  34  million  ounces  of  silver  at  Phase  7  and  Puren,  which  comprise  the  La  Coipa   Restart  project,  was  converted  to  estimated  mineral  reserves  from  estimated  mineral  resources.  The  scope  of  work  contemplated  by   the   project   PFS   included   modifications   and   enhancements   to   the   existing   plant   and   infrastructure   in   order   to   allow   blending   and   processing   of   higher   grade   material   from   the   Phase   7   deposit   with   oxide/transition   material   from   the   existing   Puren   deposit.   The   Company   received   approval   on   the   project   Declaration   of   Impact   to   Environment   (“DIA”)   permit   in   2016   and   expects   to   receive   sectoral  permits  in  the  first  half  of  2018.   Paracatu  update   Paracatu  resumed  mining  and  processing  activities  in  the  fourth  quarter  of  2017  as  sufficient  water  became  available.  The  Company   continues   to   advance   its   water   mitigation   efforts   to   prepare   for   potential   lower   rainfall   levels   in   the   future.   These   efforts   include   securing  ground  water  rights  and  installation  of  wells  around  the  site.   Brazilian  royalty  legislation   On  July  26,  2017,  Brazilian  President  Temer  signed  certain  provisional  measures  related  to  the  mining  sector  which,  among  other   things,  increase  the  royalty  on  gold  and  on  silver  from  1%  and  0.2%  of  net  sales,  respectively,  to  2%  of  gross  revenues.  The  royalty   increase  for  gold  was  subsequently  reduced  to  1.5%.  The  law  was  approved  and  came  into  force  as  of  January  1,  2018.             Paracatu  optimization  studies   Kinross  has  recently  completed  initial  optimization  and  analysis  work  for  Paracatu.  The  optimization  and  analysis  work  focused  on   determining   the   optimal   mine   plan   after   taking   into   account   changes   undertaken   at   Paracatu   over   the   past   few   years.   The   optimization  work  also  assessed  the  impact  of  throughput  variances  in  quartzite-­‐impacted  zones,  lower  realized  recoveries  in  certain   zones  of  the  ore  body,  water  mitigation  projects,  local  cost  inflation,  and  changes  to  the  fiscal  regime  in  Brazil.  The  technical  work   resulted   in   an   increase   of   332,000   ounces   to   the   site’s   mineral   reserves   estimates   before   2017   depletion   and   expects   to   extend   Paracatu’s  mine  life  to  2032.   Recent  Transactions     Disposition  of  Interest  in  Cerro  Casale   On  March  28,  2017,  the  Company  announced  it  had  entered  into  an  agreement  to  sell  its  25%  interest  in  the  Cerro  Casale  project,   and  its  100%  interest  in  the  Quebrada  Seca  exploration  project  in  Chile  to  Goldcorp.     On   June   9,   2017,   the   Company   completed   the   sale   for   gross   cash   proceeds   of   $260.0   million   (which   included   $20.0   million   for   Quebrada   Seca),   a   contingent   payment   of   $40.0   million   following   a   construction   decision   for   Cerro   Casale,   the   assumption   by   Goldcorp  of  a  $20.0  million  contingent  payment  obligation  payable  to  Barrick  Gold  Corporation  (“Barrick”)  when  production  at  Cerro   Casale   commences,   and   a   1.25%   royalty   on   25%   of   gross   revenues   from   all   metals   sold   at   the   properties   (with   the   Company   foregoing  the  first  $10.0  million).  Additionally  on  closing,  the  Company  entered  into  a  water  supply  agreement  with  the  Cerro  Casale   joint  venture  to  have  certain  rights  to  access,  up  to  a  fixed  amount,  water  not  required  by  the  Cerro  Casale  joint  venture.   On  May  18,  2017,  the  Company  entered  into  an  agreement  with  White  Gold  Corp.  to  sell  its  100%  interest  in  the  White  Gold   exploration  project  in  the  Yukon  Territory.   On  June  14,  2017,  the  Company  completed  the  sale  for  gross  cash  proceeds  of  $7.6  million  (CDN$10.0  million),  17.5  million  common   shares  of  White  Gold  Corp.  representing  19.9%  of  the  issued  and  outstanding  shares  of  White  Gold  Corp.,  and  deferred  payments  of   $11.4   million   (CDN$15.0   million),   payable   in   three   equal   payments   of   $3.8   million   (CDN$5.0   million)   upon   completion   of   specific   milestones.   Completion  of  $500.0  million  Unsecured  Debt  Offering     On  July  6,  2017,  Kinross  completed  a  $500.0  million  offering  of  debt  securities  consisting  of  4.50%  senior  notes  due  2027.  Kinross   received  net  proceeds  of  $494.7  million  from  the  offering,  after  payment  of  related  fees  and  expenses.  The  notes  rank  equally  with   the   Company’s   existing   senior   notes.   The   proceeds   from   this   transaction   were   used   to   fully   repay   the   outstanding   balance   of   the   $500.0  million  term  loan  on  July  12,  2017.   Disposition  of  Interest  in  DeLamar   On  September  18,  2017,  the  Company  entered  into  an  agreement  with  Integra  to  sell  its  100%  interest  in  DeLamar.   On  November  3,  2017,  the  Company  completed  the  sale  for  cash  consideration  and  a  non-­‐interest  bearing  promissory  note,  payable   18  months  after  closing,  totaling  $5.6  million  (CDN$7.2  million),  common  shares  representing  9.9%  of  the  issued  and  outstanding   shares  of  Integra,  and  a  2.5%  net  smelter  return  royalty  that  will  be  reduced  to  1%  when  royalty  payments  have  accumulated  to  $7.8   On   February   14,   2018,   Kinross   Brasil   Mineração   (“KBM”),   a   subsidiary   of   the   Company,   signed   an   agreement   to   acquire   two   hydroelectric   power   plants   in   the   State   of   Goias,   Brazil   from   a   subsidiary   of   Gerdau   SA   for   $257.0   million.   The   two   plants   are   expected  to  secure  a  long-­‐term  supply  of  power  and  lower  production  costs  over  the  life  of  the  mine  at  Paracatu.  The  transaction  is   subject  to  regulatory  approvals  and  is  expected  to  close  in  approximately  three  to  six  months.   million  (CDN$10.0  million).   Acquisition  of  Power  Plants  in  Brazil   Other  Developments   Board  of  Directors  update   Kinross  has  appointed  Mr.  Kerry  Dyte  to  its  Board  of  Directors  effective  as  of  November  8,  2017.     Mr.  John  M.H.  Huxley,  who  has  been  a  Kinross  Board  member  since  1993,  retired  effective  as  of  December  31,  2017.     14   KINROSS ANNUAL REPORT MDA 14 15                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Disposition  of  Interest  in  White  Gold   On  May  18,  2017,  the  Company  entered  into  an  agreement  with  White  Gold  Corp.  to  sell  its  100%  interest  in  the  White  Gold   exploration  project  in  the  Yukon  Territory.   On  June  14,  2017,  the  Company  completed  the  sale  for  gross  cash  proceeds  of  $7.6  million  (CDN$10.0  million),  17.5  million  common   shares  of  White  Gold  Corp.  representing  19.9%  of  the  issued  and  outstanding  shares  of  White  Gold  Corp.,  and  deferred  payments  of   $11.4   million   (CDN$15.0   million),   payable   in   three   equal   payments   of   $3.8   million   (CDN$5.0   million)   upon   completion   of   specific   milestones.   Completion  of  $500.0  million  Unsecured  Debt  Offering     On  July  6,  2017,  Kinross  completed  a  $500.0  million  offering  of  debt  securities  consisting  of  4.50%  senior  notes  due  2027.  Kinross   received  net  proceeds  of  $494.7  million  from  the  offering,  after  payment  of  related  fees  and  expenses.  The  notes  rank  equally  with   the   Company’s   existing   senior   notes.   The   proceeds   from   this   transaction   were   used   to   fully   repay   the   outstanding   balance   of   the   $500.0  million  term  loan  on  July  12,  2017.   Disposition  of  Interest  in  DeLamar   On  September  18,  2017,  the  Company  entered  into  an  agreement  with  Integra  to  sell  its  100%  interest  in  DeLamar.   On  November  3,  2017,  the  Company  completed  the  sale  for  cash  consideration  and  a  non-­‐interest  bearing  promissory  note,  payable   18  months  after  closing,  totaling  $5.6  million  (CDN$7.2  million),  common  shares  representing  9.9%  of  the  issued  and  outstanding   shares  of  Integra,  and  a  2.5%  net  smelter  return  royalty  that  will  be  reduced  to  1%  when  royalty  payments  have  accumulated  to  $7.8   million  (CDN$10.0  million).   Paracatu  resumed  mining  and  processing  activities  in  the  fourth  quarter  of  2017  as  sufficient  water  became  available.  The  Company   continues   to   advance   its   water   mitigation   efforts   to   prepare   for   potential   lower   rainfall   levels   in   the   future.   These   efforts   include   securing  ground  water  rights  and  installation  of  wells  around  the  site.   Acquisition  of  Power  Plants  in  Brazil   On   February   14,   2018,   Kinross   Brasil   Mineração   (“KBM”),   a   subsidiary   of   the   Company,   signed   an   agreement   to   acquire   two   hydroelectric   power   plants   in   the   State   of   Goias,   Brazil   from   a   subsidiary   of   Gerdau   SA   for   $257.0   million.   The   two   plants   are   expected  to  secure  a  long-­‐term  supply  of  power  and  lower  production  costs  over  the  life  of  the  mine  at  Paracatu.  The  transaction  is   subject  to  regulatory  approvals  and  is  expected  to  close  in  approximately  three  to  six  months.   Other  Developments   Board  of  Directors  update   Kinross  has  appointed  Mr.  Kerry  Dyte  to  its  Board  of  Directors  effective  as  of  November  8,  2017.     Mr.  John  M.H.  Huxley,  who  has  been  a  Kinross  Board  member  since  1993,  retired  effective  as  of  December  31,  2017.     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Tasiast  Sud  project     The  Tasiast  Sud  pre-­‐feasibility  study  (“PFS”)  is  proceeding  as  planned  and  is  expected  to  be  completed  in  the  second  half  of  2018.   The  PFS  is  contemplating  a  potential  dump  leach  operation  that  would  combine  materials  from  multiple  deposits  in  the  area,  and   the   trucking   of   high   grade   ore   to   the   Tasiast   mill,   located   approximately   10   kilometres   north   of   the   project.   The   Company   added   approximately  820,000  ounces  to  inferred  mineral  resource  estimates  at  Tasiast  Sud  in  2017.   La  Coipa  restart  project   Compania  Minera  Mantos  de  Oro  (“MDO”),  a  subsidiary  of  the  Company,  currently  holds  a  50%  ownership  interest  in  the  Phase  7   deposit  through  its  50%  ownership  of  Minera  La  Coipa  (“MLC”),  with  the  remaining  50%  held  by  Salmones  de  Chile  Alimentos  S.A.   (“SDCA”).    Pursuant  to  an  agreement  signed  on  February  2,  2018,  MDO,  MLC  and  SDCA  have  agreed,  among  other  things,  to  spin  out   the  Phase  7  concessions  into  a  new  company  and  MDO  has  agreed  to  purchase  SDCA’s  50%  interest  in  such  company  in  exchange  for   payments  to  SDCA  totaling  $65  million  ($35  million  on  closing  and  $30  million  on  or  before  January  31,  2019).    Following  completion   of  the  transaction,  MDO  will  have  a  100%  ownership  interest  in  the  Phase  7  deposit.  The  transaction  is  subject  to  certain  conditions   and  is  expected  to  close  within  90  days.   In  2017,  approximately  844,000  ounces  of  gold  and  34  million  ounces  of  silver  at  Phase  7  and  Puren,  which  comprise  the  La  Coipa   Restart  project,  was  converted  to  estimated  mineral  reserves  from  estimated  mineral  resources.  The  scope  of  work  contemplated  by   the   project   PFS   included   modifications   and   enhancements   to   the   existing   plant   and   infrastructure   in   order   to   allow   blending   and   processing   of   higher   grade   material   from   the   Phase   7   deposit   with   oxide/transition   material   from   the   existing   Puren   deposit.   The   Company   received   approval   on   the   project   Declaration   of   Impact   to   Environment   (“DIA”)   permit   in   2016   and   expects   to   receive   sectoral  permits  in  the  first  half  of  2018.   Paracatu  update   Brazilian  royalty  legislation   Paracatu  optimization  studies   Paracatu’s  mine  life  to  2032.   Recent  Transactions     Disposition  of  Interest  in  Cerro  Casale   On  July  26,  2017,  Brazilian  President  Temer  signed  certain  provisional  measures  related  to  the  mining  sector  which,  among  other   things,  increase  the  royalty  on  gold  and  on  silver  from  1%  and  0.2%  of  net  sales,  respectively,  to  2%  of  gross  revenues.  The  royalty   increase  for  gold  was  subsequently  reduced  to  1.5%.  The  law  was  approved  and  came  into  force  as  of  January  1,  2018.             Kinross  has  recently  completed  initial  optimization  and  analysis  work  for  Paracatu.  The  optimization  and  analysis  work  focused  on   determining   the   optimal   mine   plan   after   taking   into   account   changes   undertaken   at   Paracatu   over   the   past   few   years.   The   optimization  work  also  assessed  the  impact  of  throughput  variances  in  quartzite-­‐impacted  zones,  lower  realized  recoveries  in  certain   zones  of  the  ore  body,  water  mitigation  projects,  local  cost  inflation,  and  changes  to  the  fiscal  regime  in  Brazil.  The  technical  work   resulted   in   an   increase   of   332,000   ounces   to   the   site’s   mineral   reserves   estimates   before   2017   depletion   and   expects   to   extend   On  March  28,  2017,  the  Company  announced  it  had  entered  into  an  agreement  to  sell  its  25%  interest  in  the  Cerro  Casale  project,   and  its  100%  interest  in  the  Quebrada  Seca  exploration  project  in  Chile  to  Goldcorp.     On   June   9,   2017,   the   Company   completed   the   sale   for   gross   cash   proceeds   of   $260.0   million   (which   included   $20.0   million   for   Quebrada   Seca),   a   contingent   payment   of   $40.0   million   following   a   construction   decision   for   Cerro   Casale,   the   assumption   by   Goldcorp  of  a  $20.0  million  contingent  payment  obligation  payable  to  Barrick  Gold  Corporation  (“Barrick”)  when  production  at  Cerro   Casale   commences,   and   a   1.25%   royalty   on   25%   of   gross   revenues   from   all   metals   sold   at   the   properties   (with   the   Company   foregoing  the  first  $10.0  million).  Additionally  on  closing,  the  Company  entered  into  a  water  supply  agreement  with  the  Cerro  Casale   joint  venture  to  have  certain  rights  to  access,  up  to  a  fixed  amount,  water  not  required  by  the  Cerro  Casale  joint  venture.   14   15 KINROSS ANNUAL REPORT MDA 15                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   5. CONSOLIDATED  RESULTS  OF  OPERATIONS   Operating Highlights (in  millions,  except  ounces  and  per  ounce  amounts) Operating  Statistics   Total  gold  equivalent  ounces  (a) Produced  (c) Sold  (c) Attributable  gold  equivalent  ounces  (a) Produced  (c) Sold  (c) Gold  ounces  -­‐  sold   Silver  ounces  -­‐  sold  (000's) Average  realized  gold  price  per  ounce (b) Financial  data   Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment,  net  of  reversals Operating  earnings  (loss) Net  earnings  (loss)  attributable  to  common  shareholders Years  ended  December  31, 2017  vs.  2016 2016  vs.  2015 2017 2016 2015 Change %  Change  (d) Change %  Change   2,698,136 2,810,345 2,620,262 2,621,875 2,778,902 2,634,867 (112,209) (157,027) (4%) (6%) 190,083 144,035 2,673,533 2,789,150 2,594,652 2,596,754 2,758,306 2,608,870 (115,617) (161,552) 2,553,178 2,697,912 2,562,219 (144,734) 5,058 5,913 5,378 (855) (4%) (6%) (5%) (14%) 194,498 149,436 135,693 535 $                           1,260 $                         1,249 $                         1,159 $                                     11 1% $                                                 90 $                 3,303.0 $               3,472.0 $               3,052.2 $                   (169.0) (5%) $                                   419.8 $                 1,757.4 $               1,983.8 $               1,834.8 $                   (226.4) (11%) $                                   149.0 $                           $                                 819.4 21.5 $                         $                         855.0 139.6 $                         $                         897.7 699.0 $                         $                   (35.6) (118.1) $                           $                           336.5 445.4 $                               $                     46.3 (104.0) $                     $                     (742.9) (984.5) $                       $                       290.2 549.4 (4%) (85%) $                                     $                               (42.7) (559.4) nm nm $                                   $                                   789.2 880.5 7% 5% 7% 6% 5% 10% 8% 14% 8% (5%) (80%) 106% 89% (a) (b) (c) "Total"  includes  100%  of  Chirano  production.    "Attributable"  includes  Kinross'  share  of  Chirano  (90%)  production.   The  definition  of  this  non-­‐GAAP  financial  measure  is  included  in  Section  11  of  this  document. "Gold  equivalent  ounces"  include  silver  ounces  produced  and  sold  converted  to  a  gold  equivalent  based  on  a  ratio  of  the  average  spot  market  prices  for  the   commodities  for  each  period.    The  ratio  for  2017  was  73.72:1  (2016  -­‐  72.95:1  and  2015  -­‐  73.92:1). (d)   "nm"  means  not  meaningful. KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Operating  Earnings  (Loss)  by  Segment   (in  millions) Operating  segments Fort  Knox Round  Mountain Bald  Mountain Kettle  River-­‐Buckhorn Paracatu Maricunga Kupol  (a) Tasiast Chirano Non-­‐operating  segment Corporate  and  Other  (b) Total Years  ended  December  31, 2017  vs.  2016 2016  vs.  2015 2017 2016 2015 Change %  Change  (c) Change %  Change  (c) $                       224.7 $                       110.0 $                           (180.8) $                       114.7 104% $               290.8 139.7 68.5 43.4 (263.3) 21.3 225.0 118.8 (27.5) 85.8 (37.4) 64.0 36.2 (150.6) 345.3 (119.9) (58.0) (8.9) -­‐ 30.3 24.4 (60.4) 150.1 (361.2) (70.1) 53.9 105.9 (20.6) (299.5) 171.9 (120.3) 238.7 30.5 63% nm (32%) nm 114% (35%) 199% 53% 94.7 (37.4) 33.7 11.8 (90.2) 195.2 241.3 12.1 (214.1) (229.1) (266.3) 15.0 $                       336.5 $                             46.3 $                           (742.9) $                       290.2 7% nm 37.2 $               789.2 161% nm nm 111% 48% (149%) 130% 67% 17% 14% 106% (a ) T he  K upol  s eg ment  inc ludes  the  K upol  a nd  Dvoinoye  mines . (b) "C orpora te  a nd  O ther"  inc ludes  opera ting  c os ts  whic h  a re  not  direc tly  rela ted  to  individua l  mining  properties  s uc h  a s  overhea d  expens es ,  g a ins  a nd   los s es  on  dis pos a l  of  a s s ets  a nd  inves tments ,  a nd  other  c os ts  rela ting  to  non-­‐ opera ting  a s s ets  (inc luding  L a  C oipa ,  L obo-­‐ Ma rte,  C erro  C a s a le  until   its  dis pos a l  on  J une  9,  2017  a nd  White  G old  until  its  dis pos a l  on  J une  14,  2017).   (c) "nm"  means  not  meaningful. 16   KINROSS ANNUAL REPORT MDA 16 17                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   5. CONSOLIDATED  RESULTS  OF  OPERATIONS   Operating Highlights (in  millions,  except  ounces  and  per  ounce  amounts) Operating  Statistics   Total  gold  equivalent  ounces  (a) Produced  (c) Sold  (c) Produced  (c) Sold  (c) Attributable  gold  equivalent  ounces  (a) Gold  ounces  -­‐  sold   Silver  ounces  -­‐  sold  (000's) Average  realized  gold  price  per  ounce (b) Financial  data   Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment,  net  of  reversals Operating  earnings  (loss) Years  ended  December  31, 2017  vs.  2016 2016  vs.  2015 2017 2016 2015 Change %  Change  (d) Change %  Change   2,698,136 2,810,345 2,620,262 2,621,875 2,778,902 2,634,867 (112,209) (157,027) (4%) (6%) 190,083 144,035 2,673,533 2,789,150 2,594,652 2,596,754 2,758,306 2,608,870 (115,617) (161,552) 2,553,178 2,697,912 2,562,219 (144,734) 5,058 5,913 5,378 (855) (4%) (6%) (5%) (14%) 194,498 149,436 135,693 535 $                           1,260 $                         1,249 $                         1,159 $                                     11 1% $                                                 90 $                 3,303.0 $               3,472.0 $               3,052.2 $                   (169.0) (5%) $                                   419.8 $                 1,757.4 $               1,983.8 $               1,834.8 $                   (226.4) (11%) $                                   149.0 $                           819.4 $                         855.0 $                         897.7 $                         (35.6) (4%) $                                     (42.7) $                                 21.5 $                         139.6 $                         699.0 $                   (118.1) (85%) $                               (559.4) $                           336.5 $                               46.3 $                     (742.9) $                       290.2 nm nm $                                   789.2 $                                   880.5 7% 5% 7% 6% 5% 10% 8% 14% 8% (5%) (80%) 106% 89% Net  earnings  (loss)  attributable  to  common  shareholders $                           445.4 $                     (104.0) $                     (984.5) $                       549.4 "Total"  includes  100%  of  Chirano  production.    "Attributable"  includes  Kinross'  share  of  Chirano  (90%)  production.   The  definition  of  this  non-­‐GAAP  financial  measure  is  included  in  Section  11  of  this  document. (a) (b) (c) "Gold  equivalent  ounces"  include  silver  ounces  produced  and  sold  converted  to  a  gold  equivalent  based  on  a  ratio  of  the  average  spot  market  prices  for  the   commodities  for  each  period.    The  ratio  for  2017  was  73.72:1  (2016  -­‐  72.95:1  and  2015  -­‐  73.92:1). (d)   "nm"  means  not  meaningful. KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Operating  Earnings  (Loss)  by  Segment   (in  millions) Operating  segments Fort  Knox Round  Mountain Bald  Mountain Kettle  River-­‐Buckhorn Paracatu Maricunga Kupol  (a) Tasiast Chirano Non-­‐operating  segment Corporate  and  Other  (b) Total Years  ended  December  31, 2017  vs.  2016 2016  vs.  2015 2017 2016 2015 Change %  Change  (c) Change %  Change  (c) $                       224.7 139.7 68.5 43.4 (263.3) 21.3 $                       110.0 85.8 (37.4) 64.0 36.2 (150.6) $                           (180.8) (8.9) -­‐ 30.3 24.4 (60.4) $                       114.7 53.9 105.9 (20.6) (299.5) 171.9 225.0 118.8 (27.5) 345.3 (119.9) (58.0) 150.1 (361.2) (70.1) (120.3) 238.7 30.5 104% 63% nm (32%) nm 114% (35%) 199% 53% $               290.8 94.7 (37.4) 33.7 11.8 (90.2) 195.2 241.3 12.1 (214.1) 336.5 $                       (229.1) 46.3 $                             (266.3) (742.9) $                           15.0 290.2 $                       7% nm 37.2 789.2 $               161% nm nm 111% 48% (149%) 130% 67% 17% 14% 106% (a ) T he  K upol  s eg ment  inc ludes  the  K upol  a nd  Dvoinoye  mines . (b) "C orpora te  a nd  O ther"  inc ludes  opera ting  c os ts  whic h  a re  not  direc tly  rela ted  to  individua l  mining  properties  s uc h  a s  overhea d  expens es ,  g a ins  a nd   los s es  on  dis pos a l  of  a s s ets  a nd  inves tments ,  a nd  other  c os ts  rela ting  to  non-­‐ opera ting  a s s ets  (inc luding  L a  C oipa ,  L obo-­‐ Ma rte,  C erro  C a s a le  until   its  dis pos a l  on  J une  9,  2017  a nd  White  G old  until  its  dis pos a l  on  J une  14,  2017).   (c) "nm"  means  not  meaningful. 16   17 KINROSS ANNUAL REPORT MDA 17                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Round  Mountain  (100%  ownership  and  operator)  –  USA   Operating  Statistics Tonnes  ore  mined  (000's) Tonnes  processed  (000's)(a) Grade  (grams/tonne)(b) Recovery(b) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Years  ended  December  31, 2017 2016 Change %  Change   26,418 23,270 1.41 81.2% 23,530 23,713 0.98 80.7% 2,888 (443) 0.43 0.5% 436,932 438,051 378,264 377,910 58,668 60,141 $                       552.2 $                       477.1 $                             75.1 302.5 107.4 142.3 2.6 292.0 94.7 90.4 4.6 10.5 12.7 51.9 (2.0) 12% (2%) 44% 1% 16% 16% 16% 4% 13% 57% (43%) 63% Depreciation,  depletion  and  amortization Exploration  and  business  development Segment  operating  earnings   $                       139.7 $                             85.8 $                             53.9 (a ) Inc ludes  19,611,000  to nnes  pla c ed  o n  the  hea p  lea c h  pa ds  during  2017  (2016  -­‐  20,084,000  to nnes ). (b)   A m o unt  repres ents  m ill  g ra de  a nd  rec o v ery  o nly.    O re  pla c ed  o n  the  hea p  lea c h  pa ds  ha d  a n  a v era g e  g ra de  o f   0.50  g ram s  per  to nne  during  2017  (2016  -­‐  0.44  g ram s  per  to nne).    D ue  to  the  na ture  o f  hea p  lea c h  o pera tio ns ,  po int-­‐ in-­‐tim e  rec o v ery  ra tes  a re  no t  m ea ning ful.   The  Company  acquired  its  50%  ownership  interest  in  the  Round  Mountain  open  pit  mine,  located  in  Nye  County,  Nevada,  with  the   acquisition  of  Echo  Bay  Mines  Ltd.  ("Echo  Bay")  on  January  31,  2003.  On  January  11,  2016,  the  Company  acquired  the  remaining  50%   interest  in  Round  Mountain,  along  with  the  Bald  Mountain  gold  mine  from  Barrick.     During  2017,  tonnes  of  ore  mined  and  mill  grade  increased  by  12%  and  44%  respectively,  compared  with  2016,  primarily  due  to  mine   sequencing   which   involved   mining   in   a   deeper   location   with   higher   grade.   Gold   equivalent   ounces   produced   increased   by   16%   compared  with  2016,  primarily  due  to  higher  mill  grade.   Metal  sales  increased  to  $552.2  million  in  2017  from  $477.1  million  in  2016  due  to  an  increase  in  gold  equivalent  ounces  sold.  During   2017,  production  cost  of  sales  increased  by  4%  compared  to  2016,  mainly  due  to  the  increase  in  gold  equivalent  ounces  sold  partially   offset  by  a  decrease  in  labour  and  contractor  costs  by  7%.    Depreciation,  depletion  and  amortization  increased  to  $107.4  million  in   2017  from  $94.7  million  in  2016,  primarily  due  to  increases  in  gold  equivalent  ounces  sold  and  the  depreciable  asset  base,  slightly   offset  by  an  increase  in  the  mineral  reserves  at  the  end  of  the  third  quarter  of  2017.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Mining  Operations     Fort  Knox  (100%  ownership  and  operator)  –  USA   Operating  Statistics Tonnes  ore  mined  (000's)   Tonnes  processed  (000's)  (a)   Grade  (grams/tonne)(b) Recovery(b) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment  reversal Exploration  and  business  development Other Segment  operating  earnings   Years  ended  December  31, 2017 2016 Change %  Change  (c) 26,362 32,736 0.84 82.5% 31,750 42,360 0.69 82.8% (5,388) (9,624) 0.15 (0.3%) 381,115 381,779 409,844 408,059 (28,729) (26,280) $                       $                         481.1 239.9 86.6 (88.6) 243.2 9.0 9.5 224.7 $                       510.8 302.2 88.7 -­‐ 119.9 8.9 1.0 110.0 $                       (29.7) (62.3) (2.1) (88.6) 123.3 0.1 8.5 114.7 $                       $                       (17%) (23%) 22% (0%) (7%) (6%) (6%) (21%) (2%) nm 103% 1% nm 104% (a ) (b) Inc ludes  20,267,000  to nnes  pla c ed  o n  the  hea p  lea c h  pa ds  during  2017  (2016  -­‐  29,142,000  to nnes ). A m o unt  repres ents  m ill  g ra de  a nd  rec o v ery  o nly.    O re  pla c ed  o n  the  hea p  lea c h  pa ds  ha d  a n  a v era g e  g ra de  o f   0.25     g ram s  per  to nne  during  2017  (2016  -­‐  0.27  g ram s  per  to nne).    D ue  to  the  na ture  o f  hea p  lea c h  o pera tio ns ,  po int-­‐in-­‐tim e   rec o v ery  ra tes  a re  no t  m ea ning ful.   (c ) "nm "  m ea ns  no t  m ea ning ful. The  Company  has  been  operating  the  Fort  Knox  mine,  located  near  Fairbanks,  Alaska,  since  it  was  acquired  in  1998.   2017  vs.  2016   2017  vs.  2016   During   2017,   tonnes   of   ore   mined   decreased   by   17%   compared   with   2016,   primarily   due   to   planned   mine   sequencing,   which   involved   increased  capitalized  stripping.  Tonnes  of  ore  processed  were  lower  by  23%  in  2017  compared  with  2016,  largely  due  to   fewer  tonnes  placed  on  the  heap  leach  pads  as  a  result  of  the  decrease  in  ore  mined. Mill  grades  were  22%  higher  in  2017  compared   with  2016  as  a  result  of  mine  sequencing.    Gold  equivalent  ounces  produced  decreased  by  7%  compared  with  2016,  primarily  due  to   a  decrease  in  ounces  produced  from  the  heap  leach  pads  as  a  result  of  fewer  tonnes  placed,  offset  by  an  increase  in  mill  grades.     Metal  sales  were  6%  lower  in  2017  compared  with  2016  due  to  a  decrease  in  gold  equivalent  ounces  sold.  During  2017,  production   cost  of  sales  was  lower  by  21%  compared  with  2016,  due  to  less  operating  waste  mined  and  an  8%  decrease  in  labour  and  contractor   costs,   partially   offset   by   a   17%   increase   in   maintenance   and   power   costs.   Depreciation,   depletion   and   amortization   in   2017   decreased  by  2%,  mainly  due  to  lower  gold  equivalent  ounces  sold,  partially  offset  by  an  increase  in  the  depreciable  asset  base.     At   December   31,   2017,   the   Company   recognized   a   reversal   of   previously   recorded   impairment   charges   of   $88.6   million.   The   non-­‐ cash  impairment  reversal  related  to  property,  plant  and  equipment  was  primarily  due  to  an  increase  in  the  Company’s  estimates  of   future  metal  prices  and  additions  to  Fort  Knox’s  mineral  reserve  estimates.  No  such  impairment  reversal  was  recognized  in  2016.   During  2017,  other  operating  costs  of  $9.5  million  primarily  includes  costs  related  to  the  Gilmore  feasibility  study.     18   KINROSS ANNUAL REPORT MDA 18 19                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Mining  Operations     Fort  Knox  (100%  ownership  and  operator)  –  USA   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Round  Mountain  (100%  ownership  and  operator)  –  USA   Years  ended  December  31, 2017 2016 Change %  Change   $                       $                       $                       $                             $                             75.1 10.5 12.7 51.9 (2.0) 53.9 552.2 302.5 107.4 142.3 2.6 139.7 477.1 292.0 94.7 90.4 4.6 85.8 12% (2%) 44% 1% 16% 16% 16% 4% 13% 57% (43%) 63% 26,418 23,270 1.41 81.2% 23,530 23,713 0.98 80.7% 2,888 (443) 0.43 0.5% 436,932 438,051 378,264 377,910 58,668 60,141 Operating  Statistics Tonnes  ore  mined  (000's) Tonnes  processed  (000's)(a) Grade  (grams/tonne)(b) Recovery(b) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Exploration  and  business  development Segment  operating  earnings   Years  ended  December  31, 2017 2016 Change %  Change  (c) Operating  Statistics Tonnes  ore  mined  (000's)   Tonnes  processed  (000's)  (a)   Grade  (grams/tonne)(b) Recovery(b) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment  reversal Exploration  and  business  development 26,362 32,736 0.84 82.5% 31,750 42,360 0.69 82.8% (5,388) (9,624) 0.15 (0.3%) 381,115 381,779 409,844 408,059 (28,729) (26,280) $                       481.1 $                       510.8 $                         (29.7) 239.9 86.6 (88.6) 243.2 9.0 9.5 302.2 88.7 -­‐ 119.9 8.9 1.0 (62.3) (2.1) (88.6) 123.3 0.1 8.5 Other (a ) (b) Segment  operating  earnings   $                       224.7 $                       110.0 $                       114.7 Inc ludes  20,267,000  to nnes  pla c ed  o n  the  hea p  lea c h  pa ds  during  2017  (2016  -­‐  29,142,000  to nnes ). A m o unt  repres ents  m ill  g ra de  a nd  rec o v ery  o nly.    O re  pla c ed  o n  the  hea p  lea c h  pa ds  ha d  a n  a v era g e  g ra de  o f   0.25     g ram s  per  to nne  during  2017  (2016  -­‐  0.27  g ram s  per  to nne).    D ue  to  the  na ture  o f  hea p  lea c h  o pera tio ns ,  po int-­‐in-­‐tim e   rec o v ery  ra tes  a re  no t  m ea ning ful.   (c ) "nm "  m ea ns  no t  m ea ning ful. (17%) (23%) 22% (0%) (7%) (6%) (6%) (21%) (2%) nm 103% 1% nm 104% 2017  vs.  2016   During   2017,   tonnes   of   ore   mined   decreased   by   17%   compared   with   2016,   primarily   due   to   planned   mine   sequencing,   which   involved   increased  capitalized  stripping.  Tonnes  of  ore  processed  were  lower  by  23%  in  2017  compared  with  2016,  largely  due  to   fewer  tonnes  placed  on  the  heap  leach  pads  as  a  result  of  the  decrease  in  ore  mined. Mill  grades  were  22%  higher  in  2017  compared   with  2016  as  a  result  of  mine  sequencing.    Gold  equivalent  ounces  produced  decreased  by  7%  compared  with  2016,  primarily  due  to   a  decrease  in  ounces  produced  from  the  heap  leach  pads  as  a  result  of  fewer  tonnes  placed,  offset  by  an  increase  in  mill  grades.     Metal  sales  were  6%  lower  in  2017  compared  with  2016  due  to  a  decrease  in  gold  equivalent  ounces  sold.  During  2017,  production   cost  of  sales  was  lower  by  21%  compared  with  2016,  due  to  less  operating  waste  mined  and  an  8%  decrease  in  labour  and  contractor   costs,   partially   offset   by   a   17%   increase   in   maintenance   and   power   costs.   Depreciation,   depletion   and   amortization   in   2017   decreased  by  2%,  mainly  due  to  lower  gold  equivalent  ounces  sold,  partially  offset  by  an  increase  in  the  depreciable  asset  base.     At   December   31,   2017,   the   Company   recognized   a   reversal   of   previously   recorded   impairment   charges   of   $88.6   million.   The   non-­‐ cash  impairment  reversal  related  to  property,  plant  and  equipment  was  primarily  due  to  an  increase  in  the  Company’s  estimates  of   future  metal  prices  and  additions  to  Fort  Knox’s  mineral  reserve  estimates.  No  such  impairment  reversal  was  recognized  in  2016.   During  2017,  other  operating  costs  of  $9.5  million  primarily  includes  costs  related  to  the  Gilmore  feasibility  study.     The  Company  has  been  operating  the  Fort  Knox  mine,  located  near  Fairbanks,  Alaska,  since  it  was  acquired  in  1998.   2017  vs.  2016   (a ) Inc ludes  19,611,000  to nnes  pla c ed  o n  the  hea p  lea c h  pa ds  during  2017  (2016  -­‐  20,084,000  to nnes ). (b)   A m o unt  repres ents  m ill  g ra de  a nd  rec o v ery  o nly.    O re  pla c ed  o n  the  hea p  lea c h  pa ds  ha d  a n  a v era g e  g ra de  o f   0.50  g ram s  per  to nne  during  2017  (2016  -­‐  0.44  g ram s  per  to nne).    D ue  to  the  na ture  o f  hea p  lea c h  o pera tio ns ,  po int-­‐ in-­‐tim e  rec o v ery  ra tes  a re  no t  m ea ning ful.   The  Company  acquired  its  50%  ownership  interest  in  the  Round  Mountain  open  pit  mine,  located  in  Nye  County,  Nevada,  with  the   acquisition  of  Echo  Bay  Mines  Ltd.  ("Echo  Bay")  on  January  31,  2003.  On  January  11,  2016,  the  Company  acquired  the  remaining  50%   interest  in  Round  Mountain,  along  with  the  Bald  Mountain  gold  mine  from  Barrick.     During  2017,  tonnes  of  ore  mined  and  mill  grade  increased  by  12%  and  44%  respectively,  compared  with  2016,  primarily  due  to  mine   sequencing   which   involved   mining   in   a   deeper   location   with   higher   grade.   Gold   equivalent   ounces   produced   increased   by   16%   compared  with  2016,  primarily  due  to  higher  mill  grade.   Metal  sales  increased  to  $552.2  million  in  2017  from  $477.1  million  in  2016  due  to  an  increase  in  gold  equivalent  ounces  sold.  During   2017,  production  cost  of  sales  increased  by  4%  compared  to  2016,  mainly  due  to  the  increase  in  gold  equivalent  ounces  sold  partially   offset  by  a  decrease  in  labour  and  contractor  costs  by  7%.    Depreciation,  depletion  and  amortization  increased  to  $107.4  million  in   2017  from  $94.7  million  in  2016,  primarily  due  to  increases  in  gold  equivalent  ounces  sold  and  the  depreciable  asset  base,  slightly   offset  by  an  increase  in  the  mineral  reserves  at  the  end  of  the  third  quarter  of  2017.   18   19 KINROSS ANNUAL REPORT MDA 19   $                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Bald  Mountain  (100%  ownership  and  operator)  –  USA   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Kettle  River–Buckhorn  (100%  ownership  and  operator)  –  USA   2017 Years  ended  December  31, Change 2016 %  Change  (b) Operating  Statistics  (a) Tonnes  ore  mined  (000's)   Tonnes  processed  (000's)   Grade  (grams/tonne) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Exploration  and  business  development Other Segment  operating  earnings  (loss) 21,615 21,615 0.80 282,715 262,916 10,656 10,656 0.64 10,959 10,959 0.16 130,144 111,464 152,571 151,452 $                               $                                             $                   331.5 168.9 83.5 79.1 9.5 1.1 68.5 139.6 131.7 38.6 (30.7) 4.7 2.0 (37.4) 191.9 37.2 44.9 109.8 4.8 (0.9) 105.9 $                                     $                                                 $                   103% 103% 25% 117% 136% 137% 28% 116% nm 102% (45%) nm (a) (b) D ue  to  the  nature  o f  heap  leac h  o peratio ns ,  po int-­‐in-­‐tim e  rec o v ery  rates  are  no t  m eaning ful. "nm "  m eans  no t  m eaning ful. The   Company   completed   the   acquisition   of   100%   of   the   Bald   Mountain   open   pit   mine   on   January   11,   2016   from   Barrick,   which   includes  a  large  associated  land  package.   2017  vs.  2016   During   2017,   tonnes   of   ore   mined   and   processed   increased   by   103%   compared   to   2016,   consistent   with   the   mine   plan.   Grade   increased   by   25%   in   2017,   compared   to   2016,   due   to   mine   sequencing   which   involved   mining   in   higher   grade   locations.   Gold   equivalent   ounces   produced   increased   by   117%   compared   to   2016   primarily   due   to   more   ounces   recovered   from   the   heap   leach   pads,  as  a  result  of  more  tonnes  placed  and  the  higher  grade.  Gold  equivalent  ounces  sold  in  2017  were  lower  than  production  due   to  timing  of  sales.   In   2017,   metal   sales   increased   to   $331.5   million   from   $139.6   million   in   2016   due   to   the   increase   in   gold   equivalent   ounces   sold.   Production  cost  of  sales  increased  by  28%  compared  to  2016  due  to  higher  gold  equivalent  ounces  sold  in  addition  to  an  increase  in   labour,   reagents   and   fuel   costs   by   37%,   partially   offset   by   a   33%   decrease   in   maintenance   and   contractor   costs.   Depreciation,   depletion  and  amortization  increased  by  116%  compared  to  2016,  primarily  due  to  increases  in  gold  equivalent  ounces  sold  and  the   depreciable  asset  base.     20   KINROSS ANNUAL REPORT MDA 20 21   Years  ended  December  31, 2017 2016 Change %  Change (a) 189 234 9.53 438 441 7.84 94.4% 93.3% (249) (207) 1.69 1.1% 76,570 77,087 112,274 112,038 (35,704) (34,951) $                             96.3 $                       139.8 $                         (43.5) 36.8 0.6 58.9 4.6 10.9 73.0 1.3 65.5 2.2 (0.7) (36.2) (0.7) (6.6) 2.4 11.6 (57%) (47%) 22% 1% (32%) (31%) (31%) (50%) (54%) (10%) 109% nm (32%) Operating  Statistics Tonnes  ore  mined  (000's) Tonnes  processed  (000's) Grade  (grams/tonne) Recovery Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Exploration  and  business  development Other (a) "nm"  means  not  meaningful. mining  activities  were  completed.   2017  vs.  2016   Segment  operating  earnings $                             43.4 $                             64.0 $                         (20.6) The   Kettle   River–Buckhorn   properties   are   located   in   Ferry   and   Okanogan   Counties   in   the   State   of   Washington.     Kinross   acquired   Kettle  River  through  the  acquisition  of  Echo  Bay  on  January  31,  2003.  In  2017,  the  Kettle  River  mine  came  to  the  end  of  its  life  and   Tonnes   of   ore   mined   and   tonnes   processed   decreased   by   57%   and   47%,   respectively,   due   to   the   completion   of   mining   activities   during   2017.   Gold   equivalent   ounces   produced   and   sold   decreased   by   32%   and   31%,   respectively,   compared   with   2016,   primarily   due  to  lower  throughput  offset  by  an  increase  in  grade.   Metal  sales  decreased  by  31%  in  2017  compared  with  2016  due  to  the  decrease  in  gold  equivalent  ounces  sold.  Production  cost  of   sales  and  depreciation,  depletion  and  amortization  decreased  by  50%  and  54%,  respectively,  compared  with  2016,  mainly  due  to  the   completion  of  mining  activities  during  2017.    In   2017,   other   costs   of   $10.9   million   includes   reclamation   expense   related   to   a   revision   of   estimates   for   the   reclamation   and   remediation  obligation  as  the  mine  prepares  for  its  closure.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 Years  ended  December  31, 2017 2016 Change %  Change  (b) 21,615 21,615 0.80 282,715 262,916 168.9 83.5 79.1 9.5 1.1 10,656 10,656 0.64 10,959 10,959 0.16 130,144 111,464 152,571 151,452 131.7 38.6 (30.7) 4.7 2.0 37.2 44.9 109.8 4.8 (0.9) 103% 103% 25% 117% 136% 137% 28% 116% nm 102% (45%) nm $                               331.5 $                                             139.6 $                   191.9 Operating  Statistics  (a) Tonnes  ore  mined  (000's)   Tonnes  processed  (000's)   Grade  (grams/tonne) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Exploration  and  business  development Other (a) (b) "nm "  m eans  no t  m eaning ful. includes  a  large  associated  land  package.   2017  vs.  2016   Segment  operating  earnings  (loss) $                                     68.5 $                                                 (37.4) $                   105.9 D ue  to  the  nature  o f  heap  leac h  o peratio ns ,  po int-­‐in-­‐tim e  rec o v ery  rates  are  no t  m eaning ful. The   Company   completed   the   acquisition   of   100%   of   the   Bald   Mountain   open   pit   mine   on   January   11,   2016   from   Barrick,   which   During   2017,   tonnes   of   ore   mined   and   processed   increased   by   103%   compared   to   2016,   consistent   with   the   mine   plan.   Grade   increased   by   25%   in   2017,   compared   to   2016,   due   to   mine   sequencing   which   involved   mining   in   higher   grade   locations.   Gold   equivalent   ounces   produced   increased   by   117%   compared   to   2016   primarily   due   to   more   ounces   recovered   from   the   heap   leach   pads,  as  a  result  of  more  tonnes  placed  and  the  higher  grade.  Gold  equivalent  ounces  sold  in  2017  were  lower  than  production  due   to  timing  of  sales.   In   2017,   metal   sales   increased   to   $331.5   million   from   $139.6   million   in   2016   due   to   the   increase   in   gold   equivalent   ounces   sold.   Production  cost  of  sales  increased  by  28%  compared  to  2016  due  to  higher  gold  equivalent  ounces  sold  in  addition  to  an  increase  in   labour,   reagents   and   fuel   costs   by   37%,   partially   offset   by   a   33%   decrease   in   maintenance   and   contractor   costs.   Depreciation,   depletion  and  amortization  increased  by  116%  compared  to  2016,  primarily  due  to  increases  in  gold  equivalent  ounces  sold  and  the   depreciable  asset  base.     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Bald  Mountain  (100%  ownership  and  operator)  –  USA   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Kettle  River–Buckhorn  (100%  ownership  and  operator)  –  USA   Years  ended  December  31, 2017 2016 Change %  Change (a) Operating  Statistics Tonnes  ore  mined  (000's) Tonnes  processed  (000's) Grade  (grams/tonne) Recovery Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Exploration  and  business  development Other Segment  operating  earnings (a) "nm"  means  not  meaningful. 189 234 9.53 94.4% 438 441 7.84 93.3% (249) (207) 1.69 1.1% 76,570 77,087 112,274 112,038 (35,704) (34,951) $                             $                       $                         96.3 36.8 0.6 58.9 4.6 10.9 43.4 139.8 73.0 1.3 65.5 2.2 (0.7) 64.0 (43.5) (36.2) (0.7) (6.6) 2.4 11.6 (20.6) $                             $                             $                         (57%) (47%) 22% 1% (32%) (31%) (31%) (50%) (54%) (10%) 109% nm (32%) The   Kettle   River–Buckhorn   properties   are   located   in   Ferry   and   Okanogan   Counties   in   the   State   of   Washington.     Kinross   acquired   Kettle  River  through  the  acquisition  of  Echo  Bay  on  January  31,  2003.  In  2017,  the  Kettle  River  mine  came  to  the  end  of  its  life  and   mining  activities  were  completed.   2017  vs.  2016   Tonnes   of   ore   mined   and   tonnes   processed   decreased   by   57%   and   47%,   respectively,   due   to   the   completion   of   mining   activities   during   2017.   Gold   equivalent   ounces   produced   and   sold   decreased   by   32%   and   31%,   respectively,   compared   with   2016,   primarily   due  to  lower  throughput  offset  by  an  increase  in  grade.   Metal  sales  decreased  by  31%  in  2017  compared  with  2016  due  to  the  decrease  in  gold  equivalent  ounces  sold.  Production  cost  of   sales  and  depreciation,  depletion  and  amortization  decreased  by  50%  and  54%,  respectively,  compared  with  2016,  mainly  due  to  the   completion  of  mining  activities  during  2017.    In   2017,   other   costs   of   $10.9   million   includes   reclamation   expense   related   to   a   revision   of   estimates   for   the   reclamation   and   remediation  obligation  as  the  mine  prepares  for  its  closure.   20   21 KINROSS ANNUAL REPORT MDA 21                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Paracatu  (100%  ownership  and  operator)  –  Brazil   Operating  Statistics Tonnes  ore  mined  (000's) Tonnes  processed  (000's) Grade  (grams/tonne) Recovery Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment  charge Other Segment  operating  earnings  (loss) (a ) "nm "  m ea ns  no t  m ea ning ful. Years  ended  December  31, 2017 2016 Change %  Change  (a) Years  ended  December  31, 2017 2016 Change %  Change  (b) 27,770 37,623 0.41 74.6% 47,206 46,816 0.45 72.3% (19,436) (9,193) (0.04) 2.3% 359,959 356,251 483,014 482,827 (123,055) (126,576) $                       $                   447.0 310.2 127.0 253.0 (243.2) 20.1 (263.3) $                       599.6 346.4 142.7 -­‐ 110.5 74.3 36.2 $                             (152.6) (36.2) (15.7) 253.0 (353.7) (54.2) (299.5) $                   $                   (41%) (20%) (9%) 3% (25%) (26%) (25%) (10%) (11%) nm nm (73%) nm The  Company  acquired  a  49%  ownership  interest  in  the  Paracatu  open  pit  mine,  located  in  the  State  of  Minas  Gerais,  Brazil,  upon   the   acquisition   of   TVX   Gold   Inc.   on   January  31,   2003.   On   December  31,   2004,   the   Company   purchased   the   remaining   51%   of   Paracatu  from  Rio  Tinto  Plc.     2017  vs.  2016   During  2017,  tonnes  of  ore  mined  and  processed  decreased  by  41%  and  20%,  respectively,  compared  to  2016  due  to  a  temporary   curtailment   as   a   result   of   lower   than   average   rainfall   in   the   area.   Grade   decreased   by   9%   in   2017   compared   to   2016   due   to   the   metallurgical  characteristics  of  the  ore  mined.  Gold  equivalent  ounces  produced  decreased  by  25%  compared  with  2016,  mainly  as  a   result  of  the  decrease  in  throughput  and  grades.  Gold  equivalent  ounces  sold  in  2017  were  lower  than  production  due  to  timing  of   sales.   Metal  sales  decreased  by  25%  in  2017  compared  with  2016  due  to  the  decrease  in  gold  equivalent  ounces  sold.    Production  cost  of   sales  was  lower  by  10%  in  2017  compared  with  2016,  primarily  due  to  the  decrease  in  gold  equivalent  ounces  sold,  partially  offset  by   an  increase  in  operating  waste  mined.  Depreciation,  depletion  and  amortization  decreased  by  11%  mainly  as  a  result  of  fewer  gold   equivalent  ounces  sold,  offset  by  an  increase  in  the  depreciable  asset  base.   Metal  sales  and  production  cost  of  sales  decreased  by  76%  and  86%,  respectively,  compared  with  2016  primarily  due  to  the  decrease   in   gold   equivalent   ounces   sold.   Depreciation,   depletion   and   amortization   decreased   from   $34.4   million   in   2016   to   $4.6   million   in   2017,  primarily  due  to  decreases  in  gold  equivalent  ounces  sold  and  the  depreciable  asset  base  as  a  result  of  the  impairment  charge   recognized  in  2016.     During   2017,   other   costs   of   $20.1   million   mainly   included   $23.6   million   of   costs   related   to   the   temporary   curtailment,   offset   by   revenues   of   $9.0   million   related   to   the   sale   of   excess   energy   that   became   available   as   a   result   of   the   curtailment.   Other   costs   of   $74.3  million  incurred  in  2016  included  $58.0  million  related  to  a  write-­‐off  of  VAT  receivables  and  settlement  of  VAT  disputes  due  to   regulatory  changes  in  Brazil.   At   December   31,   2017,   the   Company   recorded   a   non-­‐cash   impairment   charge   of   $253.0   million related   to   property,   plant   and   equipment.  The  impairment  charge  at  Paracatu  was  mainly  a  result  of  changes  in  the  fiscal  regime  in  Brazil  that  were  considered  in   the  cash  flow  analysis  used  to  assess  its  recoverable  amount.  No  such  impairment  charge  was  recognized  in  2016.   22   KINROSS ANNUAL REPORT MDA 22 23   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Maricunga  (100%  ownership  and  operator)  –  Chile   Operating  Statistics  (a) Tonnes  ore  mined  (000's)   Tonnes  processed  (000's) Grade  (grams/tonne) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment  charge Exploration  and  business  development -­‐ -­‐ -­‐ 6,059 6,508 0.67 (6,059) (6,508) (0.67) 91,127 41,316 175,532 175,670 (84,405) (134,354) $                                 52.0 $                       219.4 $                   (167.4) 19.9 4.6 -­‐ 27.5 0.1 6.1 145.2 34.4 139.6 (99.8) -­‐ 50.8 (125.3) (29.8) (139.6) 127.3 0.1 (44.7) nm nm nm (48%) (76%) (76%) (86%) (87%) nm 128% nm (88%) 114% Other (a ) (b)   Segment  operating  earnings  (loss) $                                 21.3 $                   (150.6) $                       171.9 D ue  to  the  na ture  o f  hea p  lea c h  o pera tio ns ,  po int-­‐in-­‐tim e  rec o v ery  ra tes  a re  no t  m ea ning ful. "nm "  m ea ns  no t  m ea ning ful. Kinross   acquired   its   original   50%   interest   in   the   Maricunga   open   pit   mine   (formerly   known   as   the   Refugio   mine),   located   120  kilometres   northeast   of   Copiapó,   Chile   in   1998.     On   February  27,   2007,   Kinross   acquired   the   remaining   50%   interest   in   Maricunga  through  the  acquisition  of  Bema  Gold  Corporation  (“Bema”).  During  2016,  mining  activities  at  Maricunga  were  suspended   as  a  result  of  the  imposition  of  a  water  curtailment  order  by  Chile’s  environmental  enforcement  authority  (the  “SMA”).   2017  vs.  2016   As  a  result  of  the  suspension  of  mining  and  crushing  activities  at  Maricunga  since  2016,  there  was  no  ore  mined  and  processed  in   2017.   During   2017,   gold   equivalent   ounces   produced   decreased   by   48%   compared   with   2016   primarily   due   to   the   suspension   of   mining   and   crushing   activities.   Gold   equivalent   ounces   sold   in   2017   were   lower   than   production   due   to   the   timing   of   sales   and   decreased  by  76%  compared  with  2016,  primarily  due  to  the  decrease  in  gold  equivalent  ounces  produced.   At  September  30  2016,  the  Company  recorded  impairment  charges  of  $139.6  million  that  were  related  to  the  suspension  of  mining   operations.  Other  costs  of  $50.8  million  incurred  in  2016  included  $20.1  million  related  to  the  suspension  of  mining  operations  and   $27.3  million  related  to  reclamation  and  remediation  costs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Paracatu  (100%  ownership  and  operator)  –  Brazil   Operating  Statistics Tonnes  ore  mined  (000's) Tonnes  processed  (000's) Grade  (grams/tonne) Recovery Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment  charge Other (a ) "nm "  m ea ns  no t  m ea ning ful. Paracatu  from  Rio  Tinto  Plc.     2017  vs.  2016   Segment  operating  earnings  (loss) $                   (263.3) $                             36.2 $                   (299.5) The  Company  acquired  a  49%  ownership  interest  in  the  Paracatu  open  pit  mine,  located  in  the  State  of  Minas  Gerais,  Brazil,  upon   the   acquisition   of   TVX   Gold   Inc.   on   January  31,   2003.   On   December  31,   2004,   the   Company   purchased   the   remaining   51%   of   During  2017,  tonnes  of  ore  mined  and  processed  decreased  by  41%  and  20%,  respectively,  compared  to  2016  due  to  a  temporary   curtailment   as   a   result   of   lower   than   average   rainfall   in   the   area.   Grade   decreased   by   9%   in   2017   compared   to   2016   due   to   the   metallurgical  characteristics  of  the  ore  mined.  Gold  equivalent  ounces  produced  decreased  by  25%  compared  with  2016,  mainly  as  a   result  of  the  decrease  in  throughput  and  grades.  Gold  equivalent  ounces  sold  in  2017  were  lower  than  production  due  to  timing  of   sales.   Years  ended  December  31, 2017 2016 Change %  Change  (a) Years  ended  December  31, 2017 2016 Change %  Change  (b) KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Maricunga  (100%  ownership  and  operator)  –  Chile   27,770 37,623 0.41 74.6% 47,206 46,816 0.45 72.3% (19,436) (9,193) (0.04) 2.3% 359,959 356,251 483,014 482,827 (123,055) (126,576) $                       447.0 $                       599.6 $                   (152.6) 310.2 127.0 253.0 (243.2) 20.1 346.4 142.7 -­‐ 110.5 74.3 (36.2) (15.7) 253.0 (353.7) (54.2) (41%) (20%) (9%) 3% (25%) (26%) (25%) (10%) (11%) nm nm (73%) nm Operating  Statistics  (a) Tonnes  ore  mined  (000's)   Tonnes  processed  (000's) Grade  (grams/tonne) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment  charge Exploration  and  business  development Other Segment  operating  earnings  (loss) -­‐ -­‐ -­‐ 6,059 6,508 0.67 (6,059) (6,508) (0.67) 91,127 41,316 175,532 175,670 (84,405) (134,354) $                                 $                       $                   52.0 19.9 4.6 -­‐ 27.5 0.1 6.1 21.3 219.4 145.2 34.4 139.6 (99.8) -­‐ 50.8 (150.6) (167.4) (125.3) (29.8) (139.6) 127.3 0.1 (44.7) 171.9 $                                 $                   $                       nm nm nm (48%) (76%) (76%) (86%) (87%) nm 128% nm (88%) 114% (a ) (b)   D ue  to  the  na ture  o f  hea p  lea c h  o pera tio ns ,  po int-­‐in-­‐tim e  rec o v ery  ra tes  a re  no t  m ea ning ful. "nm "  m ea ns  no t  m ea ning ful. Kinross   acquired   its   original   50%   interest   in   the   Maricunga   open   pit   mine   (formerly   known   as   the   Refugio   mine),   located   120  kilometres   northeast   of   Copiapó,   Chile   in   1998.     On   February  27,   2007,   Kinross   acquired   the   remaining   50%   interest   in   Maricunga  through  the  acquisition  of  Bema  Gold  Corporation  (“Bema”).  During  2016,  mining  activities  at  Maricunga  were  suspended   as  a  result  of  the  imposition  of  a  water  curtailment  order  by  Chile’s  environmental  enforcement  authority  (the  “SMA”).   2017  vs.  2016   As  a  result  of  the  suspension  of  mining  and  crushing  activities  at  Maricunga  since  2016,  there  was  no  ore  mined  and  processed  in   2017.   During   2017,   gold   equivalent   ounces   produced   decreased   by   48%   compared   with   2016   primarily   due   to   the   suspension   of   mining   and   crushing   activities.   Gold   equivalent   ounces   sold   in   2017   were   lower   than   production   due   to   the   timing   of   sales   and   decreased  by  76%  compared  with  2016,  primarily  due  to  the  decrease  in  gold  equivalent  ounces  produced.   Metal  sales  decreased  by  25%  in  2017  compared  with  2016  due  to  the  decrease  in  gold  equivalent  ounces  sold.    Production  cost  of   sales  was  lower  by  10%  in  2017  compared  with  2016,  primarily  due  to  the  decrease  in  gold  equivalent  ounces  sold,  partially  offset  by   an  increase  in  operating  waste  mined.  Depreciation,  depletion  and  amortization  decreased  by  11%  mainly  as  a  result  of  fewer  gold   equivalent  ounces  sold,  offset  by  an  increase  in  the  depreciable  asset  base.   Metal  sales  and  production  cost  of  sales  decreased  by  76%  and  86%,  respectively,  compared  with  2016  primarily  due  to  the  decrease   in   gold   equivalent   ounces   sold.   Depreciation,   depletion   and   amortization   decreased   from   $34.4   million   in   2016   to   $4.6   million   in   2017,  primarily  due  to  decreases  in  gold  equivalent  ounces  sold  and  the  depreciable  asset  base  as  a  result  of  the  impairment  charge   recognized  in  2016.     During   2017,   other   costs   of   $20.1   million   mainly   included   $23.6   million   of   costs   related   to   the   temporary   curtailment,   offset   by   revenues   of   $9.0   million   related   to   the   sale   of   excess   energy   that   became   available   as   a   result   of   the   curtailment.   Other   costs   of   $74.3  million  incurred  in  2016  included  $58.0  million  related  to  a  write-­‐off  of  VAT  receivables  and  settlement  of  VAT  disputes  due  to   At  September  30  2016,  the  Company  recorded  impairment  charges  of  $139.6  million  that  were  related  to  the  suspension  of  mining   operations.  Other  costs  of  $50.8  million  incurred  in  2016  included  $20.1  million  related  to  the  suspension  of  mining  operations  and   $27.3  million  related  to  reclamation  and  remediation  costs.   regulatory  changes  in  Brazil.   At   December   31,   2017,   the   Company   recorded   a   non-­‐cash   impairment   charge   of   $253.0   million related   to   property,   plant   and   equipment.  The  impairment  charge  at  Paracatu  was  mainly  a  result  of  changes  in  the  fiscal  regime  in  Brazil  that  were  considered  in   the  cash  flow  analysis  used  to  assess  its  recoverable  amount.  No  such  impairment  charge  was  recognized  in  2016.   22   23 KINROSS ANNUAL REPORT MDA 23                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Kupol  (100%  ownership  and  operator)  –  Russian  Federation  (a)   Years  ended  December  31, 2017 2016 Change %  Change   Operating  Statistics Tonnes  ore  mined  (000's)  (b) Tonnes  processed  (000's)   Grade  (grams/tonne): Gold Silver Recovery: Gold Silver Gold  equivalent  ounces:  (c) Produced Sold Silver  ounces: Produced  (000's) Sold  (000's) 1,915 1,733 10.01 81.11 94.8% 84.8% 2,002 1,710 12.72 103.38 95.3% 87.8% (87) 23 (2.71) (22.27) (0.5%) (3.0%) 580,451 577,007 734,143 736,001 (153,692) (158,994) 3,879 3,873 4,909 4,902 (1,030) (1,029) Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Exploration  and  business  development Other $                       726.9 300.9 184.2 241.8 17.1 (0.3) $                       919.2 324.3 236.8 358.1 13.3 (0.5) $                   (192.3) (23.4) (52.6) (116.3) 3.8 0.2 Segment  operating  earnings $                       225.0 $                       345.3 $                   (120.3) (4%) 1% (21%) (22%) (1%) (3%) (21%) (22%) (21%) (21%) (21%) (7%) (22%) (32%) 29% 40% (35%) (a ) (b) (c ) T he  K upo l  s eg m ent  inc ludes  the  K upo l  a nd  D v o ino ye  m ines . Inc ludes   668,000    to nnes  o f  o re  m ined  fro m  D v o ino ye  during  2017  (2016  -­‐  665,000  to nnes ). "G o ld  equiv a lent  o unc es "  inc lude  s ilv er  o unc es  pro duc ed  a nd  s o ld  c o nv erted  to  a  g o ld  equiv a lent  ba s ed  o n  a   ra tio  o f  the  a v era g e  s po t  m a rk et  pric es  fo r  the  c o m m o dities  fo r  ea c h  perio d.    T he  ra tio  fo r  2017  wa s  73.72:1  (2016  -­‐   72.95:1).   The  Company  acquired  a  75%  interest  in  the  Kupol  project  in  Far  Eastern  Russia  on  February  27,  2007.    The  remaining  25%  interest   was  acquired  from  the  State  Unitary  Enterprise  of  the  Chukotka  Autonomous  Okrug  on  April  27,  2011.       2017  vs.  2016   During   2017,   tonnes   of   ore   mined   decreased   by   4%,   compared   with   2016,   primarily   due   to   mining   in   a   deeper   and   narrower   ore   body,  consistent  with  the  mine  plan.  Tonnes  of  ore  processed  increased  by  1%,  compared  with  2016  largely  due  to  an  increase  in   performance  of  the  mill.    Gold  grades  were  21%  lower  during  2017  compared  with  2016,  due  to  an  increase  in  the  proportion  of  ore   processed  from  the  low  grade  stopes  at  both  Kupol  and  Dvoinoye,  as  per  the  mine  plan.  Gold  equivalent  ounces  produced  decreased   by  21%  in  2017,  compared  with  2016,  due  to  lower  grades.    During  2017,  gold  equivalent  ounces  sold  were  lower  than  production   due  to  the  timing  of  shipments.     Metal   sales   decreased   by   21%   in   2017,   compared   with   2016   due   to   lower   gold   equivalent   ounces   sold,   partially   offset   by   higher   average   metal   prices   realized.     During   2017,   production   cost   of   sales   decreased   by   7%   compared   with   2016,   due   to   fewer   gold   equivalent   ounces   sold   and   a   decrease   in   fuel   costs   by   17%.    These   decreases   were   offset   by   an   increase   in   labour   costs   due   to   unfavourable  foreign  exchange  movements.  Depreciation,  depletion  and  amortization  decreased  by  22%  compared  with  2016  due   to  the  decrease  in  gold  equivalent  ounces  sold.     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Tasiast  (100%  ownership  and  operator)  –  Mauritania   Operating  Statistics Tonnes  ore  mined  (000's)   Tonnes  processed  (000's)  (a) Grade  (grams/tonne)  (b) Recovery  (b) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment  reversal Exploration  and  business  development Years  ended  December  31, 2017 2016 Change %  Change  (c) 6,685 4,101 2.36 92.3% 7,973 7,227 1.80 92.0% (1,288) (3,126) 0.56 0.3% 243,240 236,256 175,176 168,969 68,064 67,287 $                       298.4 $                       208.0 $                             90.4 178.2 78.6 (142.9) 184.5 5.7 60.0 179.3 96.4 -­‐ (67.7) 5.9 46.3 (1.1) (17.8) (142.9) 252.2 (0.2) 13.7 (16%) (43%) 31% 0% 39% 40% 43% (1%) (18%) nm nm (3%) 30% 199% Other (a) (b) Segment  operating  earnings  (loss) $                       118.8 $                   (119.9) $                       238.7 Inc ludes  1,056,000    to nnes  plac ed  o n  the  heap  leac h  pads  during  2017  (2016  -­‐  4,768,000  to nnes ). A m o unt  repres ents  m ill  g rade  and  rec o v ery  o nly.    O re  plac ed  o n  the  dum p  leac h  pads  had  an  av erag e  g rade  o f     0.65   g ram s  per  to nne  during  2017  (2016  -­‐  0.44  g ram s  per  to nne).    D ue  to  the  nature  o f  dum p  leac h  o peratio ns ,   po int-­‐in-­‐tim e  rec o v ery  rates  are  no t  m eaning ful.   (c ) "nm "  m eans  no t  m eaning ful. Kinross  acquired  its  100%  interest  in  the  Tasiast  mine  on  September  17,  2010  upon  completing  its  acquisition  of  Red  Back  Mining  Inc.   (“Red  Back”).    The  Tasiast  mine  is  an  open  pit  operation  located  in  north-­‐western  Mauritania  and  is  approximately  300  kilometres   north  of  the  capital  Nouakchott.   2017  vs.  2016   During   2017,   tonnes   of   ore   mined   decreased   by   16%   compared   with   2016,   primarily   due   to   mine   sequencing,   which   involved   a   decrease  in  mining  of  lower  grade  leachable  ore  from  the  West  Branch  deposit.  Tonnes  of  ore  processed  were  43%  lower  compared   with  2016,  largely  due  to  fewer  tonnes  placed  on  the  dump  leach  pads  as  a  result  of  planned  mine  sequencing,  partially  offset  by   higher  productivity  at  the  mill.  Grades  relating  to  the  ore  processed  through  the  mill  increased  by  31%  compared  with  2016  due  to   planned  mine  sequencing.  During  2017,  gold  equivalent  ounces  produced  increased  by  39%  compared  with  the  same  period  in  2016,   primarily  due  to  the  increase  in  mill  grade  as  well  as  mill  throughput.   Metal   sales   increased   by   43%   compared   with   2016   due   to   an   increase   in   gold   equivalent   ounces   sold,   as   well   as   an   increase   in   average   metal   prices   realized.     During   2017,   production   cost   of   sales   decreased   by   1%   compared   with   2016,   primarily   due   to   a   decrease   in   operating   waste   mined   and   a   16%   decrease   in   labour   costs,   offset   by   higher   gold   equivalent   ounces   sold.   Increased   capitalized   stripping   contributed   to   the   decrease   in   depreciation,   depletion   and   amortization   of   18%   in   2017   as   compared   to   the   prior  year.   2016.   operations.   At  December  31,  2017,  the  Company  recognized  a  reversal  of  previously  recorded  impairment  charges  of  $142.9  million.  The  non-­‐ cash   impairment   reversal   related   to   property,   plant   and   equipment   was   primarily   as   a   result   of   an   increase   in   the   Company’s   estimates   of   future   metal   prices   and   Tasiast   Phase   Two   progressing   as   planned.   No   such   impairment   reversal   was   recognized   in   During   2017,   other   operating   costs   of   $60.0   million   includes   $50.5   million   related   to   the   write-­‐off   of   long-­‐term   VAT   receivables.   Other  operating  costs  of  $46.3  million  recorded  in  2016  included  $20.3  million  of  costs  associated  with  the  temporary  suspension  of   24   KINROSS ANNUAL REPORT MDA 24 25                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Kupol  (100%  ownership  and  operator)  –  Russian  Federation  (a)   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Tasiast  (100%  ownership  and  operator)  –  Mauritania   Years  ended  December  31, 2017 2016 Change %  Change   Years  ended  December  31, 2017 2016 Change %  Change  (c) Operating  Statistics Tonnes  ore  mined  (000's)  (b) Tonnes  processed  (000's)   Grade  (grams/tonne): Recovery: Gold Silver Gold Silver Gold  equivalent  ounces:  (c) Produced Sold Silver  ounces: Produced  (000's) Sold  (000's) Financial  Data  (in  millions) Metal  sales Production  cost  of  sales 1,915 1,733 10.01 81.11 94.8% 84.8% 2,002 1,710 12.72 103.38 95.3% 87.8% (87) 23 (2.71) (22.27) (0.5%) (3.0%) 580,451 577,007 734,143 736,001 (153,692) (158,994) 3,879 3,873 4,909 4,902 (1,030) (1,029) $                       726.9 $                       919.2 $                   (192.3) 300.9 184.2 241.8 17.1 (0.3) 324.3 236.8 358.1 13.3 (0.5) (23.4) (52.6) (116.3) 3.8 0.2 (4%) 1% (21%) (22%) (1%) (3%) (21%) (22%) (21%) (21%) (21%) (7%) (22%) (32%) 29% 40% (35%) Depreciation,  depletion  and  amortization Exploration  and  business  development Segment  operating  earnings $                       225.0 $                       345.3 $                   (120.3) T he  K upo l  s eg m ent  inc ludes  the  K upo l  a nd  D v o ino ye  m ines . Inc ludes   668,000    to nnes  o f  o re  m ined  fro m  D v o ino ye  during  2017  (2016  -­‐  665,000  to nnes ). "G o ld  equiv a lent  o unc es "  inc lude  s ilv er  o unc es  pro duc ed  a nd  s o ld  c o nv erted  to  a  g o ld  equiv a lent  ba s ed  o n  a   ra tio  o f  the  a v era g e  s po t  m a rk et  pric es  fo r  the  c o m m o dities  fo r  ea c h  perio d.    T he  ra tio  fo r  2017  wa s  73.72:1  (2016  -­‐   The  Company  acquired  a  75%  interest  in  the  Kupol  project  in  Far  Eastern  Russia  on  February  27,  2007.    The  remaining  25%  interest   was  acquired  from  the  State  Unitary  Enterprise  of  the  Chukotka  Autonomous  Okrug  on  April  27,  2011.       Other (a ) (b) (c ) 72.95:1).   2017  vs.  2016   During   2017,   tonnes   of   ore   mined   decreased   by   4%,   compared   with   2016,   primarily   due   to   mining   in   a   deeper   and   narrower   ore   body,  consistent  with  the  mine  plan.  Tonnes  of  ore  processed  increased  by  1%,  compared  with  2016  largely  due  to  an  increase  in   performance  of  the  mill.    Gold  grades  were  21%  lower  during  2017  compared  with  2016,  due  to  an  increase  in  the  proportion  of  ore   processed  from  the  low  grade  stopes  at  both  Kupol  and  Dvoinoye,  as  per  the  mine  plan.  Gold  equivalent  ounces  produced  decreased   by  21%  in  2017,  compared  with  2016,  due  to  lower  grades.    During  2017,  gold  equivalent  ounces  sold  were  lower  than  production   due  to  the  timing  of  shipments.     Metal   sales   decreased   by   21%   in   2017,   compared   with   2016   due   to   lower   gold   equivalent   ounces   sold,   partially   offset   by   higher   average   metal   prices   realized.     During   2017,   production   cost   of   sales   decreased   by   7%   compared   with   2016,   due   to   fewer   gold   equivalent   ounces   sold   and   a   decrease   in   fuel   costs   by   17%.    These   decreases   were   offset   by   an   increase   in   labour   costs   due   to   unfavourable  foreign  exchange  movements.  Depreciation,  depletion  and  amortization  decreased  by  22%  compared  with  2016  due   to  the  decrease  in  gold  equivalent  ounces  sold.     Operating  Statistics Tonnes  ore  mined  (000's)   Tonnes  processed  (000's)  (a) Grade  (grams/tonne)  (b) Recovery  (b) Gold  equivalent  ounces: Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment  reversal Exploration  and  business  development Other Segment  operating  earnings  (loss) 6,685 4,101 2.36 92.3% 7,973 7,227 1.80 92.0% (1,288) (3,126) 0.56 0.3% 243,240 236,256 175,176 168,969 68,064 67,287 $                       $                       $                             298.4 178.2 78.6 (142.9) 184.5 5.7 60.0 118.8 208.0 179.3 96.4 -­‐ (67.7) 5.9 46.3 (119.9) 90.4 (1.1) (17.8) (142.9) 252.2 (0.2) 13.7 238.7 $                       $                   $                       (16%) (43%) 31% 0% 39% 40% 43% (1%) (18%) nm nm (3%) 30% 199% (a) (b) Inc ludes  1,056,000    to nnes  plac ed  o n  the  heap  leac h  pads  during  2017  (2016  -­‐  4,768,000  to nnes ). A m o unt  repres ents  m ill  g rade  and  rec o v ery  o nly.    O re  plac ed  o n  the  dum p  leac h  pads  had  an  av erag e  g rade  o f     0.65   g ram s  per  to nne  during  2017  (2016  -­‐  0.44  g ram s  per  to nne).    D ue  to  the  nature  o f  dum p  leac h  o peratio ns ,   po int-­‐in-­‐tim e  rec o v ery  rates  are  no t  m eaning ful.   (c ) "nm "  m eans  no t  m eaning ful. Kinross  acquired  its  100%  interest  in  the  Tasiast  mine  on  September  17,  2010  upon  completing  its  acquisition  of  Red  Back  Mining  Inc.   (“Red  Back”).    The  Tasiast  mine  is  an  open  pit  operation  located  in  north-­‐western  Mauritania  and  is  approximately  300  kilometres   north  of  the  capital  Nouakchott.   2017  vs.  2016   During   2017,   tonnes   of   ore   mined   decreased   by   16%   compared   with   2016,   primarily   due   to   mine   sequencing,   which   involved   a   decrease  in  mining  of  lower  grade  leachable  ore  from  the  West  Branch  deposit.  Tonnes  of  ore  processed  were  43%  lower  compared   with  2016,  largely  due  to  fewer  tonnes  placed  on  the  dump  leach  pads  as  a  result  of  planned  mine  sequencing,  partially  offset  by   higher  productivity  at  the  mill.  Grades  relating  to  the  ore  processed  through  the  mill  increased  by  31%  compared  with  2016  due  to   planned  mine  sequencing.  During  2017,  gold  equivalent  ounces  produced  increased  by  39%  compared  with  the  same  period  in  2016,   primarily  due  to  the  increase  in  mill  grade  as  well  as  mill  throughput.   Metal   sales   increased   by   43%   compared   with   2016   due   to   an   increase   in   gold   equivalent   ounces   sold,   as   well   as   an   increase   in   average   metal   prices   realized.     During   2017,   production   cost   of   sales   decreased   by   1%   compared   with   2016,   primarily   due   to   a   decrease   in   operating   waste   mined   and   a   16%   decrease   in   labour   costs,   offset   by   higher   gold   equivalent   ounces   sold.   Increased   capitalized   stripping   contributed   to   the   decrease   in   depreciation,   depletion   and   amortization   of   18%   in   2017   as   compared   to   the   prior  year.   At  December  31,  2017,  the  Company  recognized  a  reversal  of  previously  recorded  impairment  charges  of  $142.9  million.  The  non-­‐ cash   impairment   reversal   related   to   property,   plant   and   equipment   was   primarily   as   a   result   of   an   increase   in   the   Company’s   estimates   of   future   metal   prices   and   Tasiast   Phase   Two   progressing   as   planned.   No   such   impairment   reversal   was   recognized   in   2016.   During   2017,   other   operating   costs   of   $60.0   million   includes   $50.5   million   related   to   the   write-­‐off   of   long-­‐term   VAT   receivables.   Other  operating  costs  of  $46.3  million  recorded  in  2016  included  $20.3  million  of  costs  associated  with  the  temporary  suspension  of   operations.   24   25 KINROSS ANNUAL REPORT MDA 25                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Chirano  (90%  ownership  and  operator)  –  Ghana(a) Operating  Statistics Tonnes  ore  mined  (000's)   Tonnes  processed  (000's)   Grade  (grams/tonne) Recovery Gold  equivalent  ounces:   Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Exploration  and  business  development Other Segment  operating  loss Years  ended  December  31, 2017 2016 Change %  Change   2,410 3,438 2.44 92.2% 2,722 3,458 2.10 91.4% (312) (20) 0.34 0.8% 246,027 251,212 211,954 205,964 34,073 45,248 $                       $                       $                             317.6 200.1 138.6 (21.1) 8.2 (1.8) (27.5) 258.5 189.7 109.9 (41.1) 8.9 8.0 (58.0) 59.1 10.4 28.7 20.0 (0.7) (9.8) 30.5 $                         $                         $                             (11%) (1%) 16% 1% 16% 22% 23% 5% 26% 49% (8%) (123%) 53% (a) O perating  and  financ ial  data  are  at  100%  fo r  all  perio ds . Kinross  acquired  its  90%  interest  in  the  Chirano  mine  on  September  17,  2010  upon  completing  its  acquisition  of  Red  Back.    Chirano  is   located   in   southwestern   Ghana,   approximately   100   kilometres   southwest   of   Kumasi,   Ghana's   second   largest   city.    A   10%   carried   interest  is  held  by  the  government  of  Ghana.   2017  vs.  2016   During  2017,  tonnes  of  ore  mined  decreased  by  11%  compared  with  2016,  due  to  the  completion  of  open  pit  mining  at  the  end  of   the  second  quarter  of  2017.  The  decrease  in  tonnes  of  ore  mined  from  the  open  pit  was  partially  offset  by  increased  mining  activities   at  the  Paboase  and  Akoti  underground  deposits.  Grades  increased  by  16%,  mainly  due  to  higher  grade  ore  mined  at  Paboase  and   Akoti.    Gold  equivalent  ounces  produced  were   16%  higher  compared  with  2016,  primarily  due  to  the  higher  grades.  During  2017,   gold  equivalent  ounces  sold  exceeded  production  due  to  timing  of  shipments.   During  2017,  metal  sales  increased  by  23%  compared  to  2016,  mainly  due  to  higher  gold  equivalent  ounces  sold.    Production  cost  of   sales  increased  by  5%  compared  with  2016,  primarily  due  to  an  increase  in  gold  equivalent  ounces  sold  and  a  9%  increase  in  labour   and  maintenance  costs,  partially  offset  by  a  16%  decrease  in  power  and  overhead  costs.  Depreciation,  depletion  and  amortization   increased  by  26%  compared  with  2016,  largely  due  to  the  increase  in  gold  equivalent  ounces  sold,  a  decrease  in  mineral  reserves  at   December   31,   2016,   and   a   decrease   in   the   remaining   useful   lives   of   open   pit   assets   related   to   the   completion   of   open   pit   mining   activities  at  the  end  of  the  second  quarter  of  2017.   26   KINROSS ANNUAL REPORT MDA 26 27   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Impairment,  Net  of  Reversals   (i n  mi l l i ons ) 2017 2016 Change   %  Change Prope rty,  pl a nt  a nd  e qui pme nt  (i ) $                               21.5 $                             68.3 $                           (46.8) I nve ntory  (i i ) Impa i rme nt  cha rge s -­‐ 71.3 (71.3) $                               21.5 $                         139.6 $                       (118.1) (69%) (100%) (85%) i. Property,  plant  and  equipment     At  December  31,  2017,  upon  completion  of  its  annual  assessment  of  the  carrying  value  of  its  CGUs,  the  Company  recorded  a  net,   after-­‐tax,  impairment  reversal  of  $62.1  million.  The  impairment  reversal  was  entirely  related  to  property,  plant  and  equipment  and   included  after-­‐tax  impairment  reversals  at  Tasiast  and  Fort  Knox  of  $142.9  million  and  $86.2  million,  respectively,  partially  offset  by   an  after-­‐tax  impairment  charge  at  Paracatu  of  $167.0  million.  The  impairment  reversals  at  Tasiast  and  Fort  Knox  are  mainly  due  to   an  increase  in  the  Company’s  short-­‐term  and  long-­‐term  gold  price  estimates,  as  well  as  Tasiast  Phase  Two  progressing  as  planned   and  additions  to  Fort  Knox’s  mineral  reserve  estimates.  For  Tasiast,  the  reversal  represents  a  partial  reversal  of  the  total  impairment   charges  previously  recorded.  For  Fort  Knox,  the  reversal  represents  a  full  reversal  of  the  remaining  impairment  charge  recorded  in   2015.  The  impairment  charge  at  Paracatu  was  mainly  a  result  of  changes  in  the  fiscal  regime  in  Brazil  that  were  considered  in  the   cash  flow  analysis  used  to  assess  its  recoverable  amount.  The  impairment  charge  at  Paracatu  is  net  of  a  tax  recovery  of  $86.0  million   and  the  impairment  reversal  at  Fort  Knox  is  net  of  a  tax  expense  of  $2.4  million.  The  net  tax  recovery  of  $83.6  million  was  recorded   within  income  tax  expense.  There  was  no  tax  impact  on  the  impairment  reversal  at  Tasiast.   As   at   September   30,   2016,   the   Company   identified   the   suspension   of   mining   at   Maricunga   as   an   indication   of   impairment   and   performed  an  impairment  assessment  to  determine  the  recoverable  amount  of  the  Maricunga   CGU.  The  recoverable  amount  was   determined  by  considering  observable  market  values  for  comparable  assets.  As  the  recoverable  amount  was  lower  than  the  carrying   amount,  an  impairment  charge  of  $68.3  million  was  recorded  against  property,  plant  and  equipment.    No  impairment  charges  were   recorded  as  a  result  of  the  Company’s  annual  assessment  of  impairment  at  December  31,  2016.   Impairment  charges  recognized  against  property,  plant  and  equipment  may  be  reversed  if  there  are  changes  in  the  assumptions  or   estimates  used  in  determining  the  recoverable  amount  of  a  CGU  which  indicate  that  a  previously  recognized  impairment  loss  may  no   longer  exist  or  may  have  decreased.     ii. Inventory  and  other  assets   Other  Operating  Expense   (in  millions) Other  operating  expense In   2016,   the   Company   recognized   impairment   charges   of   $71.3   million   related   to   metals   and   supplies   inventory   at   Maricunga,   resulting  from  the  suspension  of  mining  during  the  year.     Years  ended  December  31, 2017 2016 Change   %  Change $                                         129.6 $                                     209.3 $                                           (79.7) (38%) In   2017,   other   operating   expense   included   $23.6   million   in   costs   related   to   the   temporary   curtailment   of   mining   activities   at   Paracatu   which   were   not   forecasted,  $17.5   million   related   to   a   write-­‐off   of   VAT   receivables   and   settlement   of   VAT   disputes,   $9.5   million  related  to  the  Fort  Knox  Gilmore  Feasibility  study,  reclamation  expenses  related  to  properties  where  mining  activities  have   ceased  or  are  in  reclamation,  as  well  as  care  and  maintenance  and  other  costs.   Other  operating  expense  in  2016  included  $58.0  million  related  to  a  write-­‐off  of  VAT  receivables  and  settlement  of  VAT  disputes  due   to   regulatory   changes   in   Brazil,   $40.4   million   in   costs   related   to   the   suspension   of   mining   activities   at   Maricunga   and   Tasiast,   reclamation   expenses   related   to   properties   where   mining   activities   have   ceased   or   are   in   reclamation,   as   well   as   care   and   maintenance  and  other  costs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Chirano  (90%  ownership  and  operator)  –  Ghana(a) KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Impairment,  Net  of  Reversals   Operating  Statistics Tonnes  ore  mined  (000's)   Tonnes  processed  (000's)   Grade  (grams/tonne) Recovery Gold  equivalent  ounces:   Produced Sold Financial  Data  (in  millions) Metal  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Exploration  and  business  development Other Segment  operating  loss (a) O perating  and  financ ial  data  are  at  100%  fo r  all  perio ds . Years  ended  December  31, 2017 2016 Change %  Change   2,410 3,438 2.44 92.2% 2,722 3,458 2.10 91.4% 246,027 251,212 211,954 205,964 34,073 45,248 $                       317.6 $                       258.5 $                             59.1 200.1 138.6 (21.1) 8.2 (1.8) 189.7 109.9 (41.1) 8.9 8.0 $                         (27.5) $                         (58.0) $                             30.5 (312) (20) 0.34 0.8% 10.4 28.7 20.0 (0.7) (9.8) (11%) (1%) 16% 1% 16% 22% 23% 5% 26% 49% (8%) (123%) 53% Kinross  acquired  its  90%  interest  in  the  Chirano  mine  on  September  17,  2010  upon  completing  its  acquisition  of  Red  Back.    Chirano  is   located   in   southwestern   Ghana,   approximately   100   kilometres   southwest   of   Kumasi,   Ghana's   second   largest   city.    A   10%   carried   interest  is  held  by  the  government  of  Ghana.   2017  vs.  2016   During  2017,  tonnes  of  ore  mined  decreased  by  11%  compared  with  2016,  due  to  the  completion  of  open  pit  mining  at  the  end  of   the  second  quarter  of  2017.  The  decrease  in  tonnes  of  ore  mined  from  the  open  pit  was  partially  offset  by  increased  mining  activities   at  the  Paboase  and  Akoti  underground  deposits.  Grades  increased  by  16%,  mainly  due  to  higher  grade  ore  mined  at  Paboase  and   Akoti.    Gold  equivalent  ounces  produced  were   16%  higher  compared  with  2016,  primarily  due  to  the  higher  grades.  During  2017,   gold  equivalent  ounces  sold  exceeded  production  due  to  timing  of  shipments.   During  2017,  metal  sales  increased  by  23%  compared  to  2016,  mainly  due  to  higher  gold  equivalent  ounces  sold.    Production  cost  of   sales  increased  by  5%  compared  with  2016,  primarily  due  to  an  increase  in  gold  equivalent  ounces  sold  and  a  9%  increase  in  labour   and  maintenance  costs,  partially  offset  by  a  16%  decrease  in  power  and  overhead  costs.  Depreciation,  depletion  and  amortization   increased  by  26%  compared  with  2016,  largely  due  to  the  increase  in  gold  equivalent  ounces  sold,  a  decrease  in  mineral  reserves  at   December   31,   2016,   and   a   decrease   in   the   remaining   useful   lives   of   open   pit   assets   related   to   the   completion   of   open   pit   mining   activities  at  the  end  of  the  second  quarter  of  2017.   (i n  mi l l i ons ) 2017 2016 Change   %  Change Prope rty,  pl a nt  a nd  e qui pme nt  (i ) $                               21.5 $                             68.3 $                           (46.8) I nve ntory  (i i ) Impa i rme nt  cha rge s -­‐ 71.3 (71.3) $                               21.5 $                         139.6 $                       (118.1) (69%) (100%) (85%) i. Property,  plant  and  equipment     At  December  31,  2017,  upon  completion  of  its  annual  assessment  of  the  carrying  value  of  its  CGUs,  the  Company  recorded  a  net,   after-­‐tax,  impairment  reversal  of  $62.1  million.  The  impairment  reversal  was  entirely  related  to  property,  plant  and  equipment  and   included  after-­‐tax  impairment  reversals  at  Tasiast  and  Fort  Knox  of  $142.9  million  and  $86.2  million,  respectively,  partially  offset  by   an  after-­‐tax  impairment  charge  at  Paracatu  of  $167.0  million.  The  impairment  reversals  at  Tasiast  and  Fort  Knox  are  mainly  due  to   an  increase  in  the  Company’s  short-­‐term  and  long-­‐term  gold  price  estimates,  as  well  as  Tasiast  Phase  Two  progressing  as  planned   and  additions  to  Fort  Knox’s  mineral  reserve  estimates.  For  Tasiast,  the  reversal  represents  a  partial  reversal  of  the  total  impairment   charges  previously  recorded.  For  Fort  Knox,  the  reversal  represents  a  full  reversal  of  the  remaining  impairment  charge  recorded  in   2015.  The  impairment  charge  at  Paracatu  was  mainly  a  result  of  changes  in  the  fiscal  regime  in  Brazil  that  were  considered  in  the   cash  flow  analysis  used  to  assess  its  recoverable  amount.  The  impairment  charge  at  Paracatu  is  net  of  a  tax  recovery  of  $86.0  million   and  the  impairment  reversal  at  Fort  Knox  is  net  of  a  tax  expense  of  $2.4  million.  The  net  tax  recovery  of  $83.6  million  was  recorded   within  income  tax  expense.  There  was  no  tax  impact  on  the  impairment  reversal  at  Tasiast.   As   at   September   30,   2016,   the   Company   identified   the   suspension   of   mining   at   Maricunga   as   an   indication   of   impairment   and   performed  an  impairment  assessment  to  determine  the  recoverable  amount  of  the  Maricunga   CGU.  The  recoverable  amount  was   determined  by  considering  observable  market  values  for  comparable  assets.  As  the  recoverable  amount  was  lower  than  the  carrying   amount,  an  impairment  charge  of  $68.3  million  was  recorded  against  property,  plant  and  equipment.    No  impairment  charges  were   recorded  as  a  result  of  the  Company’s  annual  assessment  of  impairment  at  December  31,  2016.   Impairment  charges  recognized  against  property,  plant  and  equipment  may  be  reversed  if  there  are  changes  in  the  assumptions  or   estimates  used  in  determining  the  recoverable  amount  of  a  CGU  which  indicate  that  a  previously  recognized  impairment  loss  may  no   longer  exist  or  may  have  decreased.     ii. Inventory  and  other  assets   In   2016,   the   Company   recognized   impairment   charges   of   $71.3   million   related   to   metals   and   supplies   inventory   at   Maricunga,   resulting  from  the  suspension  of  mining  during  the  year.     Other  Operating  Expense   (in  millions) Other  operating  expense Years  ended  December  31, 2017 2016 Change   %  Change $                                         129.6 $                                     209.3 $                                           (79.7) (38%) In   2017,   other   operating   expense   included   $23.6   million   in   costs   related   to   the   temporary   curtailment   of   mining   activities   at   Paracatu   which   were   not   forecasted,  $17.5   million   related   to   a   write-­‐off   of   VAT   receivables   and   settlement   of   VAT   disputes,   $9.5   million  related  to  the  Fort  Knox  Gilmore  Feasibility  study,  reclamation  expenses  related  to  properties  where  mining  activities  have   ceased  or  are  in  reclamation,  as  well  as  care  and  maintenance  and  other  costs.   Other  operating  expense  in  2016  included  $58.0  million  related  to  a  write-­‐off  of  VAT  receivables  and  settlement  of  VAT  disputes  due   to   regulatory   changes   in   Brazil,   $40.4   million   in   costs   related   to   the   suspension   of   mining   activities   at   Maricunga   and   Tasiast,   reclamation   expenses   related   to   properties   where   mining   activities   have   ceased   or   are   in   reclamation,   as   well   as   care   and   maintenance  and  other  costs.   26   27 KINROSS ANNUAL REPORT MDA 27                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Exploration  and  Business  Development     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Reversal  of  Impairment  Charges   (in  millions) Years  ended  December  31, 2017 2016 Change   Exploration  and  business  development $                                   106.0 $                                       94.3 $                                     11.7 %  Change 12%   Foreign  Exchange  Losses   As  a  result  of  the  agreement  entered  into  in  the  first  quarter  of  2017  to  sell  Cerro  Casale  at  a  price  higher  than  the  carrying  value,   the  Company  recognized  a  reversal  of  previously  recorded  impairment  charges  of  $97.0  million.   During  2017,  exploration  and  business  development  expenses  were  $106.0  million  compared  with  $94.3  million  in  2016.    Of  the  total   exploration   and   business   development   expense,   expenditures   on   exploration   totaled   $75.6   million   in   2017   compared   with   $67.4   million  in  2016.    Capitalized  exploration  expenses,  including  capitalized  evaluation  expenditures,  totaled  $1.9  million  compared  with   $3.1  million  during  2016.   During  2017,  foreign  exchange  losses  were  $4.9  million  compared  with  losses  of  $6.3  million  in  2016.    The  foreign  exchange  losses  of   $4.9  million  in  2017  were  mainly  due  to  the  translation  of  net  monetary  assets  denominated  in  foreign  currencies  to  the  U.S.  dollar,   with   the   U.S.   dollar   having   weakened   against   the   Mauritanian   ouguiya,   Chilean   peso,   Canadian   dollar   and   Russian   rouble   and   strengthened  against  the  Brazilian  real  as  at  December  31,  2017  relative  to  December  31,  2016.     Kinross  was  active  on  more  than  22  mine  sites,  near-­‐mine  and  greenfield  initiatives  in  2017,  with  a  total  326,244  metres  drilled.    In   2016,  Kinross  was  active  on  more  than  23  mine  sites,  near-­‐mine  and  greenfield  initiatives,  with  a  total  of  277,955  metres  drilled.       The   foreign   exchange   losses   of   $6.3   million   in   2016   were   mainly   due   to   the   translation   of   net   monetary   assets   denominated   in   foreign   currencies   to   the   U.S.   dollar,   with   the   U.S.   dollar   having   weakened   against   the   Brazilian   real,   Chilean   peso   and   Canadian   dollar  and  strengthened  against  the  Mauritanian  ouguiya  as  at  December  31,  2016  relative  to  December  31,  2015.   General  and  Administrative   (in  millions) Years  ended  December  31, 2017 2016 Change   General  and  administrative $                                   132.6 $                                 143.7 $                                 (11.1) %  Change (8%)   Other  income  of  $38.6  million  recognized  in  2017  included  the  receipt  of  insurance  recoveries  of  $17.5  million  of  which  $15.1  million   was  related  to  Maricunga,  and  $9.9  million  related  to  a  settlement  of  a  royalty  agreement.  In  2016,  other  income  of  $19.5  million   included  insurance  recoveries  of  $13.0  million  related  to  Round  Mountain.   General  and  administrative  costs  include  expenses  related  to  the  overall  management  of  the  business  which  are  not  part  of  direct   mine  operating  costs.  These  are  costs  that  are  incurred  at  corporate  offices  located  in  Canada,  Brazil,  the  Russian  Federation,  Chile,   and  the  Canary  Islands.       General  and  administrative  costs  decreased  by  $11.1  million  in  2017  compared  with  2016  primarily  due  to  lower  professional  fees.   Other  Income  (Expense)  –  Net   (in  millions) Years  ended  December  31, 2017 2016 Change   %  Change  (a) Gain  on  disposition  of  associate  and  other  interests  -­‐  net   $                                               55.2 $                                                       -­‐ $                                               55.2 Gain  on  disposition  of  other  assets  -­‐  net Reversal  of  impairment  charges Foreign  exchange  losses Net  non-­‐hedge  derivative  gains  (losses) Other Other  income  -­‐  net (a)    "nm"  means  not  meaningful. 1.9 97.0 (4.9) 0.3 38.6 9.7 -­‐ (6.3) (0.4) 19.5 (7.8) 97.0 1.4 0.7 19.1 $                                         188.1 $                                           22.5 $                                         165.6 nm (80%) nm 22% 175% 98% nm During   2017,   other   income   increased   to   $188.1   million   from   $22.5   million   in   2016.     The   discussion   below   details   the   significant   changes  in  other  income  for  2017  compared  with  2016.   Gains  on  disposition  of  associate  and  other  interests  -­‐  net   In   the   fourth   quarter   of   2017,   the   Company   completed   the   sale   of   its   100%   interest   in   DeLamar.   A   gain   of   $44.2   million   was   recognized  in  connection  with  the  sale.   In  the  second  quarter  of  2017,  the  Company  completed  the  sale  of  its  interests  in  Cerro  Casale,  Quebrada  Seca,  and  the  White  Gold   exploration  project.  A  gain  of  $12.7  million  was  recognized  in  connection  with  the  sale  of  Cerro  Casale  and  Quebrada  Seca  and  a  loss   of  $1.7  million  was  recognized  in  connection  with  the  sale  of  White  Gold.   28   KINROSS ANNUAL REPORT MDA 28 29   Other   Finance  Expense   (in  millions) Finance  expense Years  ended  December  31, 2017 2016 Change %  Change $                                   117.8 $                                 134.6 $                                 (16.8) (12%) Finance  expense  includes  accretion  on  reclamation  and  remediation  obligations  and  interest  expense.       Finance   expense   decreased   by   $16.8   million   compared   with   2016,   primarily   due   to   a   decrease   in   interest   expense.   During   2017,   interest  expense  was  $86.5  million  compared  with  $100.4  million  in  2016,  with  the  decrease  primarily  due  to  an  increase  in  interest   capitalized.     Interest   capitalized   was   $25.1   million   in   2017   compared   with   $15.2   million   in   2016,   with   the   increase   mainly   due   to   higher  qualifying  capital  expenditures.   Income  and  Mining  Taxes   and  Ghana.     Kinross  is  subject  to  tax  in  various  jurisdictions  including  Canada,  the  United  States,  Brazil,  Chile,  the  Russian  Federation,  Mauritania,   Income  tax  recovery  in  2017  was  $23.2  million,  compared  with  an  income  tax  expense  of  $49.6  million  in  2016.  The  $23.2  million   recovery   recognized   in   2017   includes   a   net   tax   recovery   of   $83.6   million   related   to   the   impairment   charge   at   Paracatu   and   impairment  reversal  at  Fort  Knox,  and  an  estimated  net  benefit  of  $93.4  million  due  to  the  enactment  of  U.S.  Tax  Reform  legislation   on   December   22,   2017.   The   estimated   net   benefit   includes   a   benefit   of   $124.4   million   in   respect   of   the   collectability   of   the   AMT   credit,  which  is  partially  offset  by  the  write-­‐down  of  net  deferred  tax  assets  to  reflect  the  reduction  in  the  U.S.  corporate  tax  rate   from   35%   to   21%   beginning   January   1,   2018.   Further   guidance   on   the   implementation   and   application   of   the   U.S.   Tax   Reform   legislation  will  be  forthcoming  in  regulations  to  be  issued  by  the  Department  of  Treasury,  legislation  or  guidance  from  the  states  in   which   the   Company   operates   and   directions   from   the   Office   of   Management   and   Budget.   Such   legislation,   regulations,   directions   and   additional   guidance   may   require   changes   to   the   estimated   net   benefit   recorded   and   the   impact   of   such   changes   will   be   accounted  for  in  the  period  in  which  the  legislation,  regulations,  directions,  and  additional  guidance  are  enacted  or  released  by  the   relevant   authorities.   The   $49.6   million   income   tax   expense   recognized   in   2016   included   a   $65.1   million   recovery   due   to   re-­‐ measurement  of  deferred  tax  assets  and  liabilities  as  a  result  of  fluctuations  in  foreign  exchange  rates  with  respect  to  the  Brazilian   real  and  the  Russian  rouble,  $32.0  million  of  expense  due  to  a  proposal  to  reassess  taxes  which  was  received  in  the  second  quarter   of  2016  and  a  tax  benefit  of  $27.7  million  realized  by  the  Company  as  a  result  of  the  acquisition  of  Bald  Mountain  and  the  remaining   50%  of  Round  Mountain.  In  addition,  tax  expense  decreased  due  to  differences  in  the  level  of  income  in  the  Company’s  operating   jurisdictions  from  one  period  to  the  next.  Kinross'  combined  federal  and  provincial  statutory  tax  rate  for  2017  was  26.5%  (2016  –   26.5%).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Exploration  and  Business  Development     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Reversal  of  Impairment  Charges   (in  millions) 2017 2016 Change   %  Change Years  ended  December  31, As  a  result  of  the  agreement  entered  into  in  the  first  quarter  of  2017  to  sell  Cerro  Casale  at  a  price  higher  than  the  carrying  value,   the  Company  recognized  a  reversal  of  previously  recorded  impairment  charges  of  $97.0  million.   Exploration  and  business  development $                                   106.0 $                                       94.3 $                                     11.7 12%   Foreign  Exchange  Losses   During  2017,  exploration  and  business  development  expenses  were  $106.0  million  compared  with  $94.3  million  in  2016.    Of  the  total   exploration   and   business   development   expense,   expenditures   on   exploration   totaled   $75.6   million   in   2017   compared   with   $67.4   million  in  2016.    Capitalized  exploration  expenses,  including  capitalized  evaluation  expenditures,  totaled  $1.9  million  compared  with   $3.1  million  during  2016.   During  2017,  foreign  exchange  losses  were  $4.9  million  compared  with  losses  of  $6.3  million  in  2016.    The  foreign  exchange  losses  of   $4.9  million  in  2017  were  mainly  due  to  the  translation  of  net  monetary  assets  denominated  in  foreign  currencies  to  the  U.S.  dollar,   with   the   U.S.   dollar   having   weakened   against   the   Mauritanian   ouguiya,   Chilean   peso,   Canadian   dollar   and   Russian   rouble   and   strengthened  against  the  Brazilian  real  as  at  December  31,  2017  relative  to  December  31,  2016.     Kinross  was  active  on  more  than  22  mine  sites,  near-­‐mine  and  greenfield  initiatives  in  2017,  with  a  total  326,244  metres  drilled.    In   2016,  Kinross  was  active  on  more  than  23  mine  sites,  near-­‐mine  and  greenfield  initiatives,  with  a  total  of  277,955  metres  drilled.       The   foreign   exchange   losses   of   $6.3   million   in   2016   were   mainly   due   to   the   translation   of   net   monetary   assets   denominated   in   foreign   currencies   to   the   U.S.   dollar,   with   the   U.S.   dollar   having   weakened   against   the   Brazilian   real,   Chilean   peso   and   Canadian   dollar  and  strengthened  against  the  Mauritanian  ouguiya  as  at  December  31,  2016  relative  to  December  31,  2015.   General  and  Administrative   Other   (in  millions) 2017 2016 Change   %  Change General  and  administrative $                                   132.6 $                                 143.7 $                                 (11.1) (8%)   General  and  administrative  costs  include  expenses  related  to  the  overall  management  of  the  business  which  are  not  part  of  direct   mine  operating  costs.  These  are  costs  that  are  incurred  at  corporate  offices  located  in  Canada,  Brazil,  the  Russian  Federation,  Chile,   and  the  Canary  Islands.       Years  ended  December  31, General  and  administrative  costs  decreased  by  $11.1  million  in  2017  compared  with  2016  primarily  due  to  lower  professional  fees.   Gain  on  disposition  of  associate  and  other  interests  -­‐  net   $                                               55.2 $                                                       -­‐ $                                               55.2 Other  Income  (Expense)  –  Net   (in  millions) Gain  on  disposition  of  other  assets  -­‐  net Reversal  of  impairment  charges Foreign  exchange  losses Net  non-­‐hedge  derivative  gains  (losses) Other Other  income  -­‐  net (a)    "nm"  means  not  meaningful. Years  ended  December  31, 2017 2016 Change   %  Change  (a) 1.9 97.0 (4.9) 0.3 38.6 9.7 -­‐ (6.3) (0.4) 19.5 (7.8) 97.0 1.4 0.7 19.1 $                                         188.1 $                                           22.5 $                                         165.6 nm (80%) nm 22% 175% 98% nm During   2017,   other   income   increased   to   $188.1   million   from   $22.5   million   in   2016.     The   discussion   below   details   the   significant   changes  in  other  income  for  2017  compared  with  2016.   Gains  on  disposition  of  associate  and  other  interests  -­‐  net   In   the   fourth   quarter   of   2017,   the   Company   completed   the   sale   of   its   100%   interest   in   DeLamar.   A   gain   of   $44.2   million   was   recognized  in  connection  with  the  sale.   In  the  second  quarter  of  2017,  the  Company  completed  the  sale  of  its  interests  in  Cerro  Casale,  Quebrada  Seca,  and  the  White  Gold   exploration  project.  A  gain  of  $12.7  million  was  recognized  in  connection  with  the  sale  of  Cerro  Casale  and  Quebrada  Seca  and  a  loss   of  $1.7  million  was  recognized  in  connection  with  the  sale  of  White  Gold.   Other  income  of  $38.6  million  recognized  in  2017  included  the  receipt  of  insurance  recoveries  of  $17.5  million  of  which  $15.1  million   was  related  to  Maricunga,  and  $9.9  million  related  to  a  settlement  of  a  royalty  agreement.  In  2016,  other  income  of  $19.5  million   included  insurance  recoveries  of  $13.0  million  related  to  Round  Mountain.   Finance  Expense   (in  millions) Finance  expense Years  ended  December  31, 2017 2016 Change %  Change $                                   117.8 $                                 134.6 $                                 (16.8) (12%) Finance  expense  includes  accretion  on  reclamation  and  remediation  obligations  and  interest  expense.       Finance   expense   decreased   by   $16.8   million   compared   with   2016,   primarily   due   to   a   decrease   in   interest   expense.   During   2017,   interest  expense  was  $86.5  million  compared  with  $100.4  million  in  2016,  with  the  decrease  primarily  due  to  an  increase  in  interest   capitalized.     Interest   capitalized   was   $25.1   million   in   2017   compared   with   $15.2   million   in   2016,   with   the   increase   mainly   due   to   higher  qualifying  capital  expenditures.   Income  and  Mining  Taxes   Kinross  is  subject  to  tax  in  various  jurisdictions  including  Canada,  the  United  States,  Brazil,  Chile,  the  Russian  Federation,  Mauritania,   and  Ghana.     Income  tax  recovery  in  2017  was  $23.2  million,  compared  with  an  income  tax  expense  of  $49.6  million  in  2016.  The  $23.2  million   recovery   recognized   in   2017   includes   a   net   tax   recovery   of   $83.6   million   related   to   the   impairment   charge   at   Paracatu   and   impairment  reversal  at  Fort  Knox,  and  an  estimated  net  benefit  of  $93.4  million  due  to  the  enactment  of  U.S.  Tax  Reform  legislation   on   December   22,   2017.   The   estimated   net   benefit   includes   a   benefit   of   $124.4   million   in   respect   of   the   collectability   of   the   AMT   credit,  which  is  partially  offset  by  the  write-­‐down  of  net  deferred  tax  assets  to  reflect  the  reduction  in  the  U.S.  corporate  tax  rate   from   35%   to   21%   beginning   January   1,   2018.   Further   guidance   on   the   implementation   and   application   of   the   U.S.   Tax   Reform   legislation  will  be  forthcoming  in  regulations  to  be  issued  by  the  Department  of  Treasury,  legislation  or  guidance  from  the  states  in   which   the   Company   operates   and   directions   from   the   Office   of   Management   and   Budget.   Such   legislation,   regulations,   directions   and   additional   guidance   may   require   changes   to   the   estimated   net   benefit   recorded   and   the   impact   of   such   changes   will   be   accounted  for  in  the  period  in  which  the  legislation,  regulations,  directions,  and  additional  guidance  are  enacted  or  released  by  the   relevant   authorities.   The   $49.6   million   income   tax   expense   recognized   in   2016   included   a   $65.1   million   recovery   due   to   re-­‐ measurement  of  deferred  tax  assets  and  liabilities  as  a  result  of  fluctuations  in  foreign  exchange  rates  with  respect  to  the  Brazilian   real  and  the  Russian  rouble,  $32.0  million  of  expense  due  to  a  proposal  to  reassess  taxes  which  was  received  in  the  second  quarter   of  2016  and  a  tax  benefit  of  $27.7  million  realized  by  the  Company  as  a  result  of  the  acquisition  of  Bald  Mountain  and  the  remaining   50%  of  Round  Mountain.  In  addition,  tax  expense  decreased  due  to  differences  in  the  level  of  income  in  the  Company’s  operating   jurisdictions  from  one  period  to  the  next.  Kinross'  combined  federal  and  provincial  statutory  tax  rate  for  2017  was  26.5%  (2016  –   26.5%).   28   29 KINROSS ANNUAL REPORT MDA 29                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   There  are  a  number  of  factors  that  can  significantly  impact  the  Company's  effective  tax  rate,  including  the  geographic  distribution  of   income,  varying  rates  in  different  jurisdictions,  the  non-­‐recognition  of  tax  assets,  mining  allowance,  foreign  currency  exchange  rate   movements,  changes  in  tax  laws,  and  the  impact  of  specific  transactions  and  assessments.     Due   to   the   number   of   factors   that   can   potentially   impact   the   effective   tax   rate   and   the   sensitivity   of   the   tax   provision   to   these   factors,  as  discussed  above,  it  is  expected  that  the  Company's  effective  tax  rate  will  fluctuate  in  future  periods.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   6. LIQUIDITY  AND  CAPITAL  RESOURCES   The  following  table  summarizes  Kinross’  cash  flow  activity:   (in  millions) Cash  Flow Provided  from  operating  activities   Used  in  investing  activities   Used  in  financing  activities   Effect  of  exchange  rate  changes  on  cash  and  cash   equivalents Increase  (decrease)  in  cash  and  cash  equivalents Cash  and  cash  equivalents,  beginning  of  period   Years  ended  December  31, 2017 2016   Change   %  Change   $                                         951.6 $                             1,099.2 $                                     (147.6) (687.2) (69.0) 3.4 198.8 827.0 (1,270.1) (48.3) 2.3 (216.9) 1,043.9 582.9 (20.7) 1.1 415.7 (216.9) (13%) 46% (43%) 48% 192% (21%) 24% Cash  and  cash  equivalents,  end  of  period $                               1,025.8 $                                     827.0 $                                         198.8 Cash   and   cash   equivalent   balances   increased   by   $198.8   million   in   2017   compared   with   a   decrease   of   $216.9   million   in   2016.     Detailed  discussions  regarding  cash  flow  movements  from  continuing  operations  are  noted  below.     Net  cash  flow  provided  from  operating  activities  decreased  by  $147.6  million  in  2017  compared  with  2016,  with  the  decrease  largely   due  to  less  favourable  working  capital  movements  and  higher  taxes  paid,  partially  offset  by  higher  margins.   Operating  Activities     2017  vs.  2016   Investing  Activities     2017  vs.  2016   Net  cash  flow  used  in  investing  activities  was  $687.2  million  in  2017  compared  with  $1,270.1  million  in  2016.    The  primary  uses  of   cash  in  2017  were  for  capital  expenditures  of  $897.6  million.  This  was  partially  offset  by  net  cash  proceeds  of  $269.6  million  from  the   sale  of  Kinross’  interests  in  Cerro  Casale,  Quebrada  Seca,  the  White  Gold  exploration  project,  and  DeLamar.   In  2016,  the  primary  uses  of  cash  were  for  the  acquisition  of  Bald  Mountain  and  the  remaining  50%  interest  in  Round  Mountain  for   $588.0  million  and  capital  expenditures  of  $633.8  million.     30   KINROSS ANNUAL REPORT MDA 30 31                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   There  are  a  number  of  factors  that  can  significantly  impact  the  Company's  effective  tax  rate,  including  the  geographic  distribution  of   income,  varying  rates  in  different  jurisdictions,  the  non-­‐recognition  of  tax  assets,  mining  allowance,  foreign  currency  exchange  rate   movements,  changes  in  tax  laws,  and  the  impact  of  specific  transactions  and  assessments.     Due   to   the   number   of   factors   that   can   potentially   impact   the   effective   tax   rate   and   the   sensitivity   of   the   tax   provision   to   these   factors,  as  discussed  above,  it  is  expected  that  the  Company's  effective  tax  rate  will  fluctuate  in  future  periods.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   6. LIQUIDITY  AND  CAPITAL  RESOURCES   The  following  table  summarizes  Kinross’  cash  flow  activity:   (in  millions) Cash  Flow Provided  from  operating  activities   Used  in  investing  activities   Used  in  financing  activities   Effect  of  exchange  rate  changes  on  cash  and  cash   equivalents Increase  (decrease)  in  cash  and  cash  equivalents Cash  and  cash  equivalents,  beginning  of  period   Years  ended  December  31, 2017 2016   Change   %  Change   $                                         951.6 $                             1,099.2 $                                     (147.6) (687.2) (69.0) 3.4 198.8 827.0 (1,270.1) (48.3) 2.3 (216.9) 1,043.9 582.9 (20.7) 1.1 415.7 (216.9) (13%) 46% (43%) 48% 192% (21%) 24% Cash  and  cash  equivalents,  end  of  period $                               1,025.8 $                                     827.0 $                                         198.8 Cash   and   cash   equivalent   balances   increased   by   $198.8   million   in   2017   compared   with   a   decrease   of   $216.9   million   in   2016.     Detailed  discussions  regarding  cash  flow  movements  from  continuing  operations  are  noted  below.     Operating  Activities     2017  vs.  2016   Net  cash  flow  provided  from  operating  activities  decreased  by  $147.6  million  in  2017  compared  with  2016,  with  the  decrease  largely   due  to  less  favourable  working  capital  movements  and  higher  taxes  paid,  partially  offset  by  higher  margins.   Investing  Activities     2017  vs.  2016   Net  cash  flow  used  in  investing  activities  was  $687.2  million  in  2017  compared  with  $1,270.1  million  in  2016.    The  primary  uses  of   cash  in  2017  were  for  capital  expenditures  of  $897.6  million.  This  was  partially  offset  by  net  cash  proceeds  of  $269.6  million  from  the   sale  of  Kinross’  interests  in  Cerro  Casale,  Quebrada  Seca,  the  White  Gold  exploration  project,  and  DeLamar.   In  2016,  the  primary  uses  of  cash  were  for  the  acquisition  of  Bald  Mountain  and  the  remaining  50%  interest  in  Round  Mountain  for   $588.0  million  and  capital  expenditures  of  $633.8  million.     30   31 KINROSS ANNUAL REPORT MDA 31                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   The  following  table  presents  a  breakdown  of  capital  expenditures  on  a  cash  basis:   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   (in  millions) Operating  segments Fort  Knox Round  Mountain Bald  Mountain Kettle  River  -­‐  Buckhorn Paracatu   Maricunga Kupol  (a) Tasiast Chirano Non-­‐operating  segment Corporate  and  Other  (b) Total Years  ended  December  31, 2017 2016 Change   %  Change   $                             102.1 $                                     70.2 $                                     31.9 95.8 90.5 -­‐ 122.4 1.5 54.3 379.4 46.6 71.9 40.5 -­‐ 108.5 5.1 88.8 190.9 46.6 23.9 50.0 -­‐ 13.9 (3.6) (34.5) 188.5 -­‐ 5.0 11.3 (6.3) $                             897.6 $                               633.8 $                               263.8 45% 33% 123% -­‐ 13% (71%) (39%) 99% -­‐ (56%) 42% (a)      Includes  $10.4  million  of  capital  expenditures  at  Dvoinoye  during  2017  (2016  -­‐  $14.4  million). (b)      "Corporate  and  Other"  includes  corporate  and  other  non-­‐operating  assets  including  La  Coipa,  Lobo-­‐ Marte  and  White  Gold  until  its  disposal  on  June  14,  2017.     During   2017,   capital   expenditures   increased   by   $263.8   million   compared   with   2016,   primarily   due   to   higher   spending   at   Tasiast   related  to  the  Phase  One  expansion  project,  increased  spending  at  Bald  Mountain  mainly  due  to  the  Vantage  Complex  project  and  at   Fort  Knox  due  to  increased  capitalized  stripping  as  per  mine  sequencing.  The  increases  were  partially  offset  by  decreased  spending   at  Kupol  due  to  the  completion  of  the  filter  cake  project  in  2016.   Financing  Activities     2017  vs.  2016   Net  cash  flow  used  in  financing  activities  was  $69.0  million  in  2017  compared  with  cash  used  of  $48.3  million  in  2016.       Interest  paid  during  2017  was  $80.9  million,  of  which  $62.9  million  was  included  in  financing  activities.    Total  interest  paid  during   2016  was  $95.3  million,  of  which  $73.5  million  was  included  in  financing  activities.       During  2017,  the  Company  completed  a  $500.0  million  offering  of  debt  securities  consisting  of  4.50%  senior  notes  due  2027.  Kinross   received  net  proceeds  of  $494.7  million  from  the  offering,  after  payment  of  related  fees  and  expenses.  The  proceeds  received  in  this   transaction  were  then  used  to  fully  repay  the  outstanding  balance  of  the  $500.0  million  term  loan.   During  2016,  the  Company  received  net  proceeds  of  $275.7  million  on  the  completion  of  the  public  equity  offering  of  95.9  million   common  shares,  including  12.5  million  common  shares  issued  to  the  underwriters  on  the  exercise  of  their  over-­‐allotment  option.  On   March   4,   2016,   Kinross   used   $175.0  million   of   the   net  proceeds   to   repay   its   drawing   on   the   revolving   credit   facility  on   January   4,   2016.   On   September   1,   2016,   the   Company   repaid   the   principal   amount   of   $250.0   million   of   senior   notes   maturing   in   September   2016.   Current  liabilities,  including  current  portion  of  long-­‐term  debt $                                                       585.3 $                                                       637.7 $                                       701.8 Balance  Sheet     (in  millions) Cash  and  cash  equivalents   Current  assets Total  assets Total  long-­‐term  financial  liabilities (a) Total  debt,  including  current  portion Total  liabilities   Common  shareholders'  equity Non-­‐controlling  interest Statistics Working  capital  (b) Working  capital  ratio  (c) As  at  December  31, 2017 2016 2015 $                                             1,025.8 $                                                       827.0 $                             1,043.9 $                                             2,284.4 $                                             2,080.7 $                             2,292.1 $                                             8,157.2 $                                             7,979.3 $                             7,735.4 $                                             2,563.1 $                                             2,594.4 $                             2,452.7 $                                             1,732.6 $                                             1,733.2 $                             1,981.4 $                                             3,538.0 $                                             3,795.0 $                             3,802.2 $                                             4,583.6 $                                             4,145.5 $                             3,889.3 $                                                             35.6 $                                                             38.8 $                                             43.9 $                                             1,699.1 $                                             1,443.0 $                             1,590.3 3.9:1 3.26:1 3.27:1 (a)  Includes  long-­‐term  debt  and  provisions. (b)  Calculated  as  current  assets  less  current  liabilities. (c)  Calculated  as  current  assets  divided  by  current  liabilities. At  December  31,  2017,  Kinross  had  cash  and  cash  equivalents  of  $1,025.8  million,  an  increase  of  $198.8  million  from  the  balance  as   at  December  31,  2016,  primarily  due  to  net  operating  cash  inflows  of  $951.6  million  and  the  receipt  of  net  cash  proceeds  of  $269.6   million  related  to  the  sale  of  Cerro  Casale,  Quebrada  Seca,  the  White  Gold  exploration  project,  and  DeLamar.  These   inflows  were   offset  by  cash  outflows  of  $897.6   million  related  to  capital  expenditures  and  $73.8   million  for  additions  to  long-­‐term  investments   and   other   assets.     Current   assets   increased   to   $2,284.4   million,   mainly   due   to   the   increase   in   cash   and   cash   equivalents   and   inventories,   partially   offset   by   a   decrease   in   current   income   tax   recoverable,   trade   receivables   and   VAT   receivables.   Total   assets   increased   by   $177.9   million   to   $8,157.2   million,   largely   due   to   increases   in   current   assets,   long-­‐term   investments   and   long   term   receivables   offset   by   a   decrease   in   investments   in   associate   and   joint   ventures   as   a   result   of   the   sale   of   Cerro   Casale.   Current   liabilities   decreased   to   $585.3   million,   primarily   due   to   the   decrease   in   current   income   taxes   payable   and   the   current   portion   of   provisions,  partially  offset  by  an  increase  in  accounts  payable  and  accrued  liabilities.  Total  long-­‐term  financial  liabilities  were  lower   by  $31.3  million,  primarily  due  to  a  decrease  in  other  long-­‐term  liabilities.     At  December  31,  2016,  Kinross  had  cash  and  cash  equivalents  of  $827.0  million,  a  decrease  of  $216.9  million  from  the  balance  as  at   December  31,  2015,  primarily  due  to  net  cash  outflows  of  $588.0  million  used  in  the  acquisition  of  Bald  Mountain  and  the  remaining   50%  of  Round  Mountain,  capital  expenditures  of  $633.8  million,  repayment  of  debt  of  $250.0  million,  and  $59.8  million  for  additions   to   long-­‐term   investments   and   other   assets,   partially   offset   by   net   operating   cash   flows   of   $1,099.2   million   and   net   proceeds   of   $275.7  million  received  from  the  equity  issuance.    Current  assets  decreased  to  $2,080.7  million,  mainly  due  to  the  decrease  in  cash   and   cash   equivalents,   partially   offset   by   an   increase   in   trade   receivables.     Total   assets   increased   by   $243.9   million   to   $7,979.3   million,  largely  due  to  the  acquisition  of  Bald  Mountain  and  the  remaining  50%  of  Round  Mountain.    Current  liabilities  decreased  to   $637.7   million,   primarily   due   to   the   repayment   of   the   current   portion   of   the   senior   notes   of   $250.0   million,   partially   offset   by   an   increase   in   accounts   payable   and   accrued   liabilities   and   income   tax   payable.    Total   long -­‐term   financial   liabilities   were   higher   by   $141.7  million,  primarily  due  to  an  increase  in  provisions  as  a  result  of  the  acquisition.     As   of   February   13,   2018,   there   were   1,247.0 million   common   shares   of   the   Company   issued   and   outstanding.     In   addition,   at   the   same  date,  the  Company  had  12.1  million  share  purchase  options  outstanding  under  its  share  option  plan.   32   KINROSS ANNUAL REPORT MDA 32 33                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   The  following  table  presents  a  breakdown  of  capital  expenditures  on  a  cash  basis:   (in  millions) Operating  segments Fort  Knox Round  Mountain Bald  Mountain Kettle  River  -­‐  Buckhorn Paracatu   Maricunga Kupol  (a) Tasiast Chirano Non-­‐operating  segment Corporate  and  Other  (b) Total Financing  Activities     2017  vs.  2016   Years  ended  December  31, 2017 2016 Change   %  Change   $                             102.1 $                                     70.2 $                                     31.9 95.8 90.5 -­‐ 122.4 1.5 54.3 379.4 46.6 71.9 40.5 -­‐ 108.5 5.1 88.8 190.9 46.6 23.9 50.0 13.9 (3.6) (34.5) 188.5 -­‐ -­‐ 5.0 11.3 (6.3) $                             897.6 $                               633.8 $                               263.8 45% 33% 123% 13% (71%) (39%) 99% -­‐ -­‐ (56%) 42% (a)      Includes  $10.4  million  of  capital  expenditures  at  Dvoinoye  during  2017  (2016  -­‐  $14.4  million). (b)      "Corporate  and  Other"  includes  corporate  and  other  non-­‐operating  assets  including  La  Coipa,  Lobo-­‐ Marte  and  White  Gold  until  its  disposal  on  June  14,  2017.     During   2017,   capital   expenditures   increased   by   $263.8   million   compared   with   2016,   primarily   due   to   higher   spending   at   Tasiast   related  to  the  Phase  One  expansion  project,  increased  spending  at  Bald  Mountain  mainly  due  to  the  Vantage  Complex  project  and  at   Fort  Knox  due  to  increased  capitalized  stripping  as  per  mine  sequencing.  The  increases  were  partially  offset  by  decreased  spending   at  Kupol  due  to  the  completion  of  the  filter  cake  project  in  2016.   Net  cash  flow  used  in  financing  activities  was  $69.0  million  in  2017  compared  with  cash  used  of  $48.3  million  in  2016.       Interest  paid  during  2017  was  $80.9  million,  of  which  $62.9  million  was  included  in  financing  activities.    Total  interest  paid  during   2016  was  $95.3  million,  of  which  $73.5  million  was  included  in  financing  activities.       During  2017,  the  Company  completed  a  $500.0  million  offering  of  debt  securities  consisting  of  4.50%  senior  notes  due  2027.  Kinross   received  net  proceeds  of  $494.7  million  from  the  offering,  after  payment  of  related  fees  and  expenses.  The  proceeds  received  in  this   transaction  were  then  used  to  fully  repay  the  outstanding  balance  of  the  $500.0  million  term  loan.   During  2016,  the  Company  received  net  proceeds  of  $275.7  million  on  the  completion  of  the  public  equity  offering  of  95.9  million   common  shares,  including  12.5  million  common  shares  issued  to  the  underwriters  on  the  exercise  of  their  over-­‐allotment  option.  On   March   4,   2016,   Kinross   used   $175.0  million   of   the   net  proceeds   to   repay   its   drawing   on   the   revolving   credit   facility  on   January   4,   2016.   On   September   1,   2016,   the   Company   repaid   the   principal   amount   of   $250.0   million   of   senior   notes   maturing   in   September   2016.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Balance  Sheet     (in  millions) Cash  and  cash  equivalents   Current  assets Total  assets As  at  December  31, 2017 $                                             1,025.8 2016 2015 $                                                       827.0 $                             1,043.9 $                                             2,284.4 $                                             2,080.7 $                             2,292.1 $                                             8,157.2 $                                             7,979.3 $                             7,735.4 Current  liabilities,  including  current  portion  of  long-­‐term  debt $                                                       585.3 $                                                       637.7 $                                       701.8 Total  long-­‐term  financial  liabilities (a) Total  debt,  including  current  portion Total  liabilities   Common  shareholders'  equity Non-­‐controlling  interest Statistics Working  capital  (b) Working  capital  ratio  (c) (a)  Includes  long-­‐term  debt  and  provisions. (b)  Calculated  as  current  assets  less  current  liabilities. (c)  Calculated  as  current  assets  divided  by  current  liabilities. $                                             2,563.1 $                                             2,594.4 $                             2,452.7 $                                             1,732.6 $                                             1,733.2 $                             1,981.4 $                                             3,538.0 $                                             3,795.0 $                             3,802.2 $                                             4,583.6 $                                             4,145.5 $                             3,889.3 $                                                             35.6 $                                                             38.8 $                                             43.9 $                                             1,699.1 $                                             1,443.0 $                             1,590.3 3.9:1 3.26:1 3.27:1 At  December  31,  2017,  Kinross  had  cash  and  cash  equivalents  of  $1,025.8  million,  an  increase  of  $198.8  million  from  the  balance  as   at  December  31,  2016,  primarily  due  to  net  operating  cash  inflows  of  $951.6  million  and  the  receipt  of  net  cash  proceeds  of  $269.6   million  related  to  the  sale  of  Cerro  Casale,  Quebrada  Seca,  the  White  Gold  exploration  project,  and  DeLamar.  These   inflows  were   offset  by  cash  outflows  of  $897.6   million  related  to  capital  expenditures  and  $73.8   million  for  additions  to  long-­‐term  investments   and   other   assets.     Current   assets   increased   to   $2,284.4   million,   mainly   due   to   the   increase   in   cash   and   cash   equivalents   and   inventories,   partially   offset   by   a   decrease   in   current   income   tax   recoverable,   trade   receivables   and   VAT   receivables.   Total   assets   increased   by   $177.9   million   to   $8,157.2   million,   largely   due   to   increases   in   current   assets,   long-­‐term   investments   and   long   term   receivables   offset   by   a   decrease   in   investments   in   associate   and   joint   ventures   as   a   result   of   the   sale   of   Cerro   Casale.   Current   liabilities   decreased   to   $585.3   million,   primarily   due   to   the   decrease   in   current   income   taxes   payable   and   the   current   portion   of   provisions,  partially  offset  by  an  increase  in  accounts  payable  and  accrued  liabilities.  Total  long-­‐term  financial  liabilities  were  lower   by  $31.3  million,  primarily  due  to  a  decrease  in  other  long-­‐term  liabilities.     At  December  31,  2016,  Kinross  had  cash  and  cash  equivalents  of  $827.0  million,  a  decrease  of  $216.9  million  from  the  balance  as  at   December  31,  2015,  primarily  due  to  net  cash  outflows  of  $588.0  million  used  in  the  acquisition  of  Bald  Mountain  and  the  remaining   50%  of  Round  Mountain,  capital  expenditures  of  $633.8  million,  repayment  of  debt  of  $250.0  million,  and  $59.8  million  for  additions   to   long-­‐term   investments   and   other   assets,   partially   offset   by   net   operating   cash   flows   of   $1,099.2   million   and   net   proceeds   of   $275.7  million  received  from  the  equity  issuance.    Current  assets  decreased  to  $2,080.7  million,  mainly  due  to  the  decrease  in  cash   and   cash   equivalents,   partially   offset   by   an   increase   in   trade   receivables.     Total   assets   increased   by   $243.9   million   to   $7,979.3   million,  largely  due  to  the  acquisition  of  Bald  Mountain  and  the  remaining  50%  of  Round  Mountain.    Current  liabilities  decreased  to   $637.7   million,   primarily   due   to   the   repayment   of   the   current   portion   of   the   senior   notes   of   $250.0   million,   partially   offset   by   an   increase   in   accounts   payable   and   accrued   liabilities   and   income   tax   payable.    Total   long -­‐term   financial   liabilities   were   higher   by   $141.7  million,  primarily  due  to  an  increase  in  provisions  as  a  result  of  the  acquisition.     As   of   February   13,   2018,   there   were   1,247.0 million   common   shares   of   the   Company   issued   and   outstanding.     In   addition,   at   the   same  date,  the  Company  had  12.1  million  share  purchase  options  outstanding  under  its  share  option  plan.   32   33 KINROSS ANNUAL REPORT MDA 33                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Financings  and  Credit  Facilities   Senior  notes   As  at  December  31,  2017,  the  Company’s  $1,750.0  million  of  senior  notes  consisted  of  $500.0  million  principal  amount  of  5.125%   notes   due   2021,   $500.0   million   principal   amount   of   5.950%   notes   due   2024,   $500.0   million   principal   amount   of   4.50%   notes   due   2027  and  $250.0  million  principal  amount  of  6.875%  notes  due  2041.     On   July   6,   2017,   the   Company   completed   a   $500.0   million   offering   of   debt   securities   consisting   of   4.50%   senior   notes   due   2027.   Kinross   received   net   proceeds   of   $494.7   million   from   the   offering,   after   payment   of   related   fees   and   expenses.   The   notes   rank   equally  with  the  Company’s  existing  senior  notes.   Corporate  revolving  credit  and  term  loan  facilities     On  July  12,  2017,  the  Company  fully  repaid  the  outstanding  balance  on  the  term  loan  with  proceeds  from  the  $500.0  million  offering   of  debt  securities  completed  on  July  6,  2017.   On  July  28,  2017,  the  Company  amended  its  $1,500.0  million  revolving  credit  facility  to  extend  the  maturity  date  by  one  year  from   August  10,  2021,  to  August  10,  2022.   As   at   December   31,   2017,   the   Company   had   utilized   $21.0   million   (December   31,   2016   –   $104.5   million)   of   its   $1,500.0   million   revolving  credit  facility.  The  amount  utilized  was  entirely  for  letters  of  credit.     As  at  December  31,  2017,  the  Company  had  no  scheduled  debt  repayments  until  2021.     Loan   interest   for   the   revolving   credit   facility   is   variable,   set   at   LIBOR   plus   an   interest   rate   margin   which   is   dependent   on   the   Company’s  credit  rating.  Based  on  the  Company’s  credit  rating  at  December  31,  2017,  interest  charges  and  fees,  are  as  follows:   Type  of  credit Dollar  based  LIBOR  loan: Revolving  credit  facility Letters  of  credit Standby  fee  applicable  to  unused  availability LIBOR  plus  2.00% 1.33-­‐2.00% 0.40% The   revolving   credit   facility   contains   various   covenants   including   limits   on   indebtedness,   asset   sales   and   liens.   The   Company   is   in   compliance  with  its  financial  covenant  in  the  credit  agreement  at  December  31,  2017.   Other     Contractual  Obligations  and  Commitments     The  maturity  date  for  the  $250.0  million  Letter  of  Credit  guarantee  facility  with  Export  Development  Canada  (“EDC”)  was  extended   by   one   year   to   June   30,   2018,   effective   July   1,   2017.   Effective   December   5,   2017,   the   Company   entered   into   an   amendment   to   increase   the   amount   of   its   Letter   of   Credit   guarantee   facility   with   EDC   from   $250.0   million   to   $300.0   million.   Letters   of   credit   guaranteed  under  this  facility  are  solely  for  reclamation  liabilities  at  Fort  Knox,  Round  Mountain,  and  Kettle  River–Buckhorn.  Fees   related   to   letters   of   credit   under   this   facility   are  0.95%   to   1.00%.   As   at   December   31,   2017,   $215.2   million   (December   31,   2016   -­‐   $215.1  million)  was  utilized  under  this  facility.   In  addition,  at  December  31,  2017,  the  Company  had  $230.2   million  (December  31,  2016  -­‐  $117.7   million)  in  letters  of  credit  and   surety   bonds   outstanding   in   respect   of   its   operations   in   Brazil,   Mauritania,   Ghana   and   Chile.   These   have   been   issued   pursuant   to   arrangements  with  certain  international  banks.   As   at   December   31,   2017,   $254.7   million   (December   31,   2016   -­‐   $216.7   million)   of   surety   bonds   were   outstanding   with   respect   to   Kinross’   operations   in   the   United   States.   The   surety   bonds   were   issued   pursuant   to   arrangements   with   international   insurance   companies.   34   KINROSS ANNUAL REPORT MDA 34 35   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   The  following  table  outlines  the  credit  facility  utilization  and  availability:   (in  millions) Utilization  of  revolving  credit  facility   Utilization  of  EDC  facility Borrowings              As  at, December  31, 2017 2016 $                                       (21.0) $                             (104.5) (215.2) (215.1) $                                 (236.2) $                             (319.6) Available  under  revolving  credit  facility   $                           1,479.0 $                       1,395.5 Available  under  EDC  credit  facility Available  credit 84.8 34.9 $                           1,563.8 $                       1,430.4 Total  debt  of  $1,732.6  million  at  December  31,  2017  consists  solely  of  the  senior  notes.  The  current  portion  of  this  debt  at  December   31,  2017  is  $nil.   Liquidity  Outlook     We  believe  that  the  Company’s  existing  cash  and  cash  equivalents  balance  of  $1,025.8  million,  available  credit  of  $1,563.8  million,   and   expected   operating   cash   flows   based   on   current   assumptions   (noted   in   Section   3   of   this   MD&A)   will   be   sufficient   to   fund   operations,  our  forecasted  exploration  and  capital  expenditures  (noted  in  Section  3  of  this  MD&A),  and  reclamation  and  remediation   obligations   currently   estimated   for   2018.   Prior   to   any   capital   investments,   consideration   is   given   to   the   cost   and   availability   of   various  sources  of  capital  resources.   With   respect   to   longer   term   capital   expenditure   funding   requirements,   the   Company   continues   to   have   discussions   with   lending   institutions   that   have   been   active   in   the   jurisdictions   in   which   the   Company’s   development   projects   are   located.   Some   of   the   jurisdictions  in  which  the  Company  operates  have  seen  the  participation  of  lenders  including  export  credit  agencies,  development   banks  and  multi-­‐lateral  agencies.  The  Company  believes  the  capital  from  these  institutions  combined  with  traditional  bank  loans  and   capital   available   through   debt   capital   market   transactions   may   fund   a   portion   of   the   Company’s   longer   term   capital   expenditure   requirements.  Another  possible  source  of  capital  could  be  proceeds  from  the  sale  of  non-­‐core  assets.  These  capital  sources  together   with   operating   cash   flow   and   the   Company’s   active   management   of   its   operations   and   development   activities   will   enable   the   Company  to  maintain  an  appropriate  overall  liquidity  position.     The  following  table  summarizes  our  long-­‐term  financial  liabilities  and  off-­‐balance  sheet  contractual  obligations  as  at  December  31,   2017:     (in  millions) Long-­‐term  debt  obligations  (a) Operating  lease  obligations Purchase  obligations  (b) Reclamation  and  remediation  obligations Interest  and  other  fees  (a) Total Total 2018 2019 2020 2021 2022 $                                   1,750.0 $                                                       -­‐ $                                                       -­‐ $                                                       -­‐ $                                                 500.0 $                                                       -­‐ $                                   1,250.0 49.9 822.3 1,183.7 972.0 25.9 462.0 64.4 104.6 12.5 285.2 65.0 102.9 4.9 5.9 55.6 102.9 2.9 34.5 117.5 102.9 2.9 0.1 62.4 74.9 $                                   4,777.9 $                                           656.9 $                                           465.6 $                                           169.3 $                                                 757.8 $                                           140.3 $                                   2,588.0 2023  &   thereafter 0.8 34.6 818.8 483.8 (a)    Debt  repayments  are  based  on  amounts  due  pursuant  to  the  terms  of  existing  indebtedness. (b)  Includes  both  capital  and  operating  commitments,  of  which  $192.7  million  relates  to  commitments  for  capital  expenditures.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Financings  and  Credit  Facilities   Senior  notes   As  at  December  31,  2017,  the  Company’s  $1,750.0  million  of  senior  notes  consisted  of  $500.0  million  principal  amount  of  5.125%   notes   due   2021,   $500.0   million   principal   amount   of   5.950%   notes   due   2024,   $500.0   million   principal   amount   of   4.50%   notes   due   2027  and  $250.0  million  principal  amount  of  6.875%  notes  due  2041.     On   July   6,   2017,   the   Company   completed   a   $500.0   million   offering   of   debt   securities   consisting   of   4.50%   senior   notes   due   2027.   Kinross   received   net   proceeds   of   $494.7   million   from   the   offering,   after   payment   of   related   fees   and   expenses.   The   notes   rank   equally  with  the  Company’s  existing  senior  notes.   Corporate  revolving  credit  and  term  loan  facilities     On  July  12,  2017,  the  Company  fully  repaid  the  outstanding  balance  on  the  term  loan  with  proceeds  from  the  $500.0  million  offering   of  debt  securities  completed  on  July  6,  2017.   On  July  28,  2017,  the  Company  amended  its  $1,500.0  million  revolving  credit  facility  to  extend  the  maturity  date  by  one  year  from   August  10,  2021,  to  August  10,  2022.   Loan   interest   for   the   revolving   credit   facility   is   variable,   set   at   LIBOR   plus   an   interest   rate   margin   which   is   dependent   on   the   Company’s  credit  rating.  Based  on  the  Company’s  credit  rating  at  December  31,  2017,  interest  charges  and  fees,  are  as  follows:   Type  of  credit Dollar  based  LIBOR  loan: Revolving  credit  facility Letters  of  credit Standby  fee  applicable  to  unused  availability LIBOR  plus  2.00% 1.33-­‐2.00% 0.40% The   revolving   credit   facility   contains   various   covenants   including   limits   on   indebtedness,   asset   sales   and   liens.   The   Company   is   in   compliance  with  its  financial  covenant  in  the  credit  agreement  at  December  31,  2017.   The  maturity  date  for  the  $250.0  million  Letter  of  Credit  guarantee  facility  with  Export  Development  Canada  (“EDC”)  was  extended   by   one   year   to   June   30,   2018,   effective   July   1,   2017.   Effective   December   5,   2017,   the   Company   entered   into   an   amendment   to   increase   the   amount   of   its   Letter   of   Credit   guarantee   facility   with   EDC   from   $250.0   million   to   $300.0   million.   Letters   of   credit   guaranteed  under  this  facility  are  solely  for  reclamation  liabilities  at  Fort  Knox,  Round  Mountain,  and  Kettle  River–Buckhorn.  Fees   related   to   letters   of   credit   under   this   facility   are  0.95%   to   1.00%.   As   at   December   31,   2017,   $215.2   million   (December   31,   2016   -­‐   $215.1  million)  was  utilized  under  this  facility.   In  addition,  at  December  31,  2017,  the  Company  had  $230.2   million  (December  31,  2016  -­‐  $117.7   million)  in  letters  of  credit  and   surety   bonds   outstanding   in   respect   of   its   operations   in   Brazil,   Mauritania,   Ghana   and   Chile.   These   have   been   issued   pursuant   to   arrangements  with  certain  international  banks.   As   at   December   31,   2017,   $254.7   million   (December   31,   2016   -­‐   $216.7   million)   of   surety   bonds   were   outstanding   with   respect   to   Kinross’   operations   in   the   United   States.   The   surety   bonds   were   issued   pursuant   to   arrangements   with   international   insurance   companies.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   The  following  table  outlines  the  credit  facility  utilization  and  availability:   (in  millions) Utilization  of  revolving  credit  facility   Utilization  of  EDC  facility Borrowings              As  at, December  31, 2017 $                                       (21.0) 2016 $                             (104.5) (215.2) (215.1) $                                 (236.2) $                             (319.6) Available  under  revolving  credit  facility   $                           1,479.0 $                       1,395.5 Available  under  EDC  credit  facility Available  credit 84.8 34.9 $                           1,563.8 $                       1,430.4 Total  debt  of  $1,732.6  million  at  December  31,  2017  consists  solely  of  the  senior  notes.  The  current  portion  of  this  debt  at  December   31,  2017  is  $nil.   Liquidity  Outlook     As   at   December   31,   2017,   the   Company   had   utilized   $21.0   million   (December   31,   2016   –   $104.5   million)   of   its   $1,500.0   million   revolving  credit  facility.  The  amount  utilized  was  entirely  for  letters  of  credit.     As  at  December  31,  2017,  the  Company  had  no  scheduled  debt  repayments  until  2021.     We  believe  that  the  Company’s  existing  cash  and  cash  equivalents  balance  of  $1,025.8  million,  available  credit  of  $1,563.8  million,   and   expected   operating   cash   flows   based   on   current   assumptions   (noted   in   Section   3   of   this   MD&A)   will   be   sufficient   to   fund   operations,  our  forecasted  exploration  and  capital  expenditures  (noted  in  Section  3  of  this  MD&A),  and  reclamation  and  remediation   obligations   currently   estimated   for   2018.   Prior   to   any   capital   investments,   consideration   is   given   to   the   cost   and   availability   of   various  sources  of  capital  resources.   With   respect   to   longer   term   capital   expenditure   funding   requirements,   the   Company   continues   to   have   discussions   with   lending   institutions   that   have   been   active   in   the   jurisdictions   in   which   the   Company’s   development   projects   are   located.   Some   of   the   jurisdictions  in  which  the  Company  operates  have  seen  the  participation  of  lenders  including  export  credit  agencies,  development   banks  and  multi-­‐lateral  agencies.  The  Company  believes  the  capital  from  these  institutions  combined  with  traditional  bank  loans  and   capital   available   through   debt   capital   market   transactions   may   fund   a   portion   of   the   Company’s   longer   term   capital   expenditure   requirements.  Another  possible  source  of  capital  could  be  proceeds  from  the  sale  of  non-­‐core  assets.  These  capital  sources  together   with   operating   cash   flow   and   the   Company’s   active   management   of   its   operations   and   development   activities   will   enable   the   Company  to  maintain  an  appropriate  overall  liquidity  position.     Other     Contractual  Obligations  and  Commitments     The  following  table  summarizes  our  long-­‐term  financial  liabilities  and  off-­‐balance  sheet  contractual  obligations  as  at  December  31,   2017:     (in  millions) Long-­‐term  debt  obligations  (a) Operating  lease  obligations Purchase  obligations  (b) Reclamation  and  remediation  obligations Interest  and  other  fees  (a) Total Total 2018 2019 2020 2021 2022 2023  &   thereafter $                                   1,750.0 $                                                       -­‐ $                                                       -­‐ $                                                       -­‐ $                                                 500.0 $                                                       -­‐ $                                   1,250.0 49.9 822.3 1,183.7 972.0 25.9 462.0 64.4 104.6 12.5 285.2 65.0 102.9 4.9 5.9 55.6 102.9 2.9 34.5 117.5 102.9 2.9 0.1 62.4 74.9 0.8 34.6 818.8 483.8 $                                   4,777.9 $                                           656.9 $                                           465.6 $                                           169.3 $                                                 757.8 $                                           140.3 $                                   2,588.0 (a)    Debt  repayments  are  based  on  amounts  due  pursuant  to  the  terms  of  existing  indebtedness. (b)  Includes  both  capital  and  operating  commitments,  of  which  $192.7  million  relates  to  commitments  for  capital  expenditures. 34   35 KINROSS ANNUAL REPORT MDA 35                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   The   Company   manages   its   exposure   to   fluctuations   in   input   commodity   prices,   currency   exchange   rates   and   interest   rates,   by   entering  into  derivative  financial  instruments  from  time  to  time,  in  accordance  with  the  Company's  risk  management  policy.     Other  legal  matters   The  following  table  provides  a  summary  of  derivative  contracts  outstanding  at  December  31,  2017:     The  Company  is  from  time  to  time  involved  in  legal  proceedings,  arising  in  the  ordinary  course  of  its  business.  Typically,  the  amount   of  ultimate  liability  with  respect  to  these  actions  will  not,  in  the  opinion  of  management,  materially  affect  Kinross’  financial  position,   Foreign  currency 2018 2019 2020 Brazilian  real  forward  buy  contracts (in  millions  of  U.S.  dollars) $                                                   69.6 $                                                               -­‐ $                                                               -­‐ Average  price  (Brazilian  reais) Brazilian  real  zero  cost  collars 3.32 -­‐ -­‐ (in  millions  of  U.S.  dollars) $                                                   25.2 $                                                   60.0 $                                                               -­‐ Average  put  strike  (Brazilian  reais) Average  call  strike  (Brazilian  reais) Canadian  dollar  forward  buy  contracts 3.75 4.12 3.45 3.64 -­‐ -­‐ (in  millions  of  U.S.  dollars) $                                                   40.5 $                                                   18.0 $                                                               -­‐ Average  rate  (Canadian  dollars) Russian  rouble  zero  cost  collars 1.35 1.28 -­‐ (in  millions  of  U.S.  dollars) $                                                   24.0 $                                                               -­‐ $                                                               -­‐ Average  put  strike  (Russian  roubles) Average  call  strike  (Russian  roubles) 60.0 71.2 -­‐ -­‐ -­‐ -­‐ WTI  oil  swap  contracts  (barrels) 907,482 594,451 90,000 Average  price $                                             48.48 $                                             49.86 $                                             52.40 The  following  new  derivative  contracts  were  entered  into  during  the  year  ended  December  31,  2017:   • • • • • $58.5  million  Canadian  dollars  at  an  average  rate  of  1.33  maturing  in  2018  to  2019;   $24.0  million  Russian  roubles  with  an  average  put  strike  of  60.00  and  an  average  call  strike  of  71.24  maturing  in  2018;     $69.6  million  Brazilian  reais  at  an  average  rate  of  3.32  maturing  in  2018;     $60.0  million  Brazilian  reais  with  an  average  put  strike  of  3.45  and  an  average  call  strike  of  3.64  maturing  in  2019;   1,048,000  barrels  of  WTI  oil  at  an  average  rate  of  $49.46  per  barrel  maturing  from  2017  to  2020.   Subsequent  to  December  31,  2017,  the  following  new  derivative  contracts  were  entered  into:   • • • $24.0  million  Russian  roubles  with  an  average  put  strike  57.00  and  average  call  strike  67.50  maturing  in  2019;   $58.5  million  Brazilian  reais  with  an  average  put  strike  of  3.32  and  an  average  call  strike  of  3.66  maturing  in  2019;   348,000  barrels  of  WTI  oil  at  an  average  rate  of  $53.39  per  barrel  maturing  in  2019  to  2020.   The   Company   enters   into   total   return   swaps   (“TRS”)   as   economic   hedges   of   the   Company’s   deferred   share   units   and   cash-­‐settled   restricted  share  units.    Hedge  accounting  was  not  applied  to  the  TRSs.    At  December  31,  2017,  5,695,000  TRS  units  were  outstanding.       Fair  value  of  derivative  instruments   The  fair  values  of  derivative  instruments  are  noted  in  the  table  below:   (in  millions) Asset  (liability) As  at, December  31, 2017 2016 Foreign  currency  forward  and  collar  contracts $                                                     6.1 $                                                     8.9 Energy  swap  contracts Total  return  swap  contracts 12.9 0.6 12.3 (6.2) $                                               19.6 $                                               15.0 36   KINROSS ANNUAL REPORT MDA 36 results  of  operations  or  cash  flows.     Maricunga  regulatory  proceedings   In  late  2013,  Compania  Minera  Maricunga  (“CMM”)  was  fined  approximately  $40,000  in  respect  of  the  degradation  of  the  Pantanillo   wetland   located   near   the   Maricunga   mine’s   water   pumping   wells.   CMM   paid   the   fine,   as   required,   and   sought   governmental   approval  of  remedial  action  plans  aimed  at  addressing  the  degradation.    CMM’s  remedial  action  plans  were  not  fully  approved  and   only   a   subset   of   CMM’s   planned   activities   were   allowed   to   be   implemented.     In   May   2015,   the   Chile   environmental   enforcement   authority   (“the   SMA”)   issued   a   resolution   alleging   that   CMM   had   irreparably   harmed   portions   of   the   Pantanillo   wetland   and   two   other  downstream  wetlands  known  respectively  as  Valle  Ancho  and  Barros  Negros,  and  that  the  mine’s  continuing  water  use  poses   an  imminent  risk  to  those  wetlands.  In  response,  CMM  submitted  legal  and  technical  defenses,  expert  reports  and  other  materials   challenging   the   SMA’s   allegations,   and,   complied   with   various   information   requests   from   the   SMA.   On   March   18,   2016,   the   SMA   issued   a   resolution   against   CMM   in   respect   of   the   SMA’s   May   2015   allegations   regarding   the   Valle   Ancho   wetland,   located   approximately   7   kilometresdowngradient   from   CMM’s   groundwater   wells   supplying   water   to   the   operation,   seeking   to   impose   a   sanction   of   an   immediate   complete   curtailment   of   water   use   from   the   groundwater   wells   and   related   aquifer   (the   “sanction   proceedings”).  Beginning  in  May  2016,  the  SMA  issued  a  series  of  resolutions  ordering  CMM  to  “temporarily”  curtail  the  pumping  of   water  from  the  groundwater  wells.  In  response,  CMM  suspended  mining  and  crushing  activities  and  reduced  water  consumption  to   minimal  levels.  CMM  contested  these  resolutions  by  seeking  reconsideration  with  the  SMA  and  appealing  to  Chile’s  Environmental   Tribunal,   but   its   efforts   were   unsuccessful   and,   except   for   a   short   period   of   time   in   July   2016,   the   Company’s   operations   have   remained  suspended.  On  June  24,  2016,  the  SMA  amended  its  initial  sanction  (the  “Amended  Sanction”).  The  terms  of  the  Amended   Sanction     effectively   required   CMM   to   cease   operations   and   close   the   mine,   with   water   use   curtailed   to   levels   far   below   those   required  for  closure  in  compliance  with  the  mine’s  government-­‐approved  plan.  On  July  9,  2016,  CMM  filed  its  appeal  in  the  sanction   proceedings.   As   part   of   its   appeal,   CMM   submitted   legal   and   technical   arguments   and   reports   by   experts   on   wetland   vegetation,   analysis  of  long-­‐term  satellite  imagery  and  groundwater  hydrology  criticizing  the  evidence  relied  upon  by  the  SMA  and  concluding   that  current  data  does  not  support  an  assertion  that  CMM’s  pumping  is  negatively  impacting  water  levels  7  kilometresdowngradient   at  the  Valle  Ancho  wetland.  On  August  30,  2016,  CMM  submitted  a  request  to  the  Environmental  Tribunal  that  it  issue  an  injunction   suspending   the   effectiveness   of   the   Amended   Sanction   pending   a   final   decision   on   the   merits   of   CMM’s   appeal   of   the   Amended   Sanction.   On   September   16,   2016,   the   Environmental   Tribunal   rejected   CMM’s   injunction   request.   On   August   7,   2017,   the   Environmental   Tribunal   upheld   the   SMA’s   Amended   Sanction   and   curtailment   orders   on   purely   procedural   grounds.     No   findings   were  made  by  the  Tribunal  on  the  issue  of  whether  CMM’s  pumping  caused  damage  to  area  wetlands,  as  alleged  by  the  SMA.    On   September  27,  2017,  CMM  appealed  the  matter  to  the  Supreme  Court  of  Chile,  which  accepted  the  appeal  on  December  14,  2017.     The  timing  of  any  substantive  decision  by  the  Supreme  Court  is  uncertain.         On  June  2,  2016,  CMM  was  served  with  two  separate  lawsuits  filed  by  the  Chilean  State  Defense  Counsel.  Both  lawsuits  are  based   upon  allegations  that  CMM’s  pumping  from  its  Pantanillo  area  groundwater  wells  has  caused  damage  to  area  wetlands.  One  action   relates  to  the  Pantanillo  wetland,  and  is  based  upon  the  sanction  imposed  upon  CMM  in  late  2013  (as  described  above).  The  other   action   relates   to   the   Valle   Ancho   wetland,   and   is   largely   based   upon   the   same   factual   assertions   at   issue   in   the   SMA   sanction   proceedings.   These   lawsuits   seek,   among   other   things,   to   require   CMM   to   cease   pumping   from   the   groundwater   wells,   finance   various  investigations  and  conduct  restoration  activities.  On  June  20,  2016,  CMM  filed  its  defenses.    Evidentiary  hearings  before  the   Environmental   Tribunal   occurred   in   2016   and   early   2017,   and   closing   arguments   occurred   in   December   2017.     The   timing   of   any   substantive  decision  by  the  Environmental  Tribunal  is  uncertain.     On   May   19,   2017,   a   release   of   diesel   fuel   occurred   from   a   power   generation   area   of   the   Rancho   del   Gallo   Camp.   The   release   occurred  when  a  pipe  valve  attached  to  a  fuel  tank  was  opened  by  an  unknown  party,  effectively  draining  the  tank.  CMM  estimates   that  approximately  15,000  litres  of  diesel  escaped  containment  affecting  the  surrounding  soil  and  a  nearby  stream.  After  discovering   the  release,  CMM  commenced  actions  designed  to  contain  the  release,  including  mobilization  of  a  third-­‐party  response  team,  and   has  addressed  both  localized  and  downstream  impacts  of  the  release.  CMM  notified  the  relevant  authorities  of  the  release,  and  has   kept  them  informed  of  its  response  activities.  Various  agencies,  including  the  SMA,  have  reviewed,  or  are  reviewing  the  situation  and   have  requested  information  from  CMM.  Further,  the  SEC  (Superintendencia  de  Electridad  y  Combustibles),  the  agency  that  regulates   fuel  facilities  and  electrical  power,  commenced  an  administrative  action  against  CMM  for  alleged  regulatory  non-­‐compliances  at  the   facility.  The  SEC  action,  or  other  legal  actions  relating  to  the  release,  could  result  in  the  imposition  of  fines  or  other  sanctions  against   CMM  or  its  employees.   37                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   The   Company   manages   its   exposure   to   fluctuations   in   input   commodity   prices,   currency   exchange   rates   and   interest   rates,   by   entering  into  derivative  financial  instruments  from  time  to  time,  in  accordance  with  the  Company's  risk  management  policy.     Other  legal  matters   The  following  table  provides  a  summary  of  derivative  contracts  outstanding  at  December  31,  2017:     Foreign  currency 2018 2019 2020 (in  millions  of  U.S.  dollars) $                                                   69.6 $                                                               -­‐ $                                                               -­‐ (in  millions  of  U.S.  dollars) $                                                   25.2 $                                                   60.0 $                                                               -­‐ Brazilian  real  forward  buy  contracts Average  price  (Brazilian  reais) Brazilian  real  zero  cost  collars Average  put  strike  (Brazilian  reais) Average  call  strike  (Brazilian  reais) Canadian  dollar  forward  buy  contracts Average  rate  (Canadian  dollars) Russian  rouble  zero  cost  collars Average  put  strike  (Russian  roubles) Average  call  strike  (Russian  roubles) (in  millions  of  U.S.  dollars) $                                                   40.5 $                                                   18.0 $                                                               -­‐ 1.35 1.28 (in  millions  of  U.S.  dollars) $                                                   24.0 $                                                               -­‐ $                                                               -­‐ 3.32 3.75 4.12 60.0 71.2 3.45 3.64 -­‐ -­‐ -­‐ -­‐ -­‐ -­‐ -­‐ -­‐ -­‐ WTI  oil  swap  contracts  (barrels) 907,482 594,451 90,000 Average  price $                                             48.48 $                                             49.86 $                                             52.40 The  following  new  derivative  contracts  were  entered  into  during  the  year  ended  December  31,  2017:   • • • • • • • • $58.5  million  Canadian  dollars  at  an  average  rate  of  1.33  maturing  in  2018  to  2019;   $24.0  million  Russian  roubles  with  an  average  put  strike  of  60.00  and  an  average  call  strike  of  71.24  maturing  in  2018;     $69.6  million  Brazilian  reais  at  an  average  rate  of  3.32  maturing  in  2018;     $60.0  million  Brazilian  reais  with  an  average  put  strike  of  3.45  and  an  average  call  strike  of  3.64  maturing  in  2019;   1,048,000  barrels  of  WTI  oil  at  an  average  rate  of  $49.46  per  barrel  maturing  from  2017  to  2020.   Subsequent  to  December  31,  2017,  the  following  new  derivative  contracts  were  entered  into:   $24.0  million  Russian  roubles  with  an  average  put  strike  57.00  and  average  call  strike  67.50  maturing  in  2019;   $58.5  million  Brazilian  reais  with  an  average  put  strike  of  3.32  and  an  average  call  strike  of  3.66  maturing  in  2019;   348,000  barrels  of  WTI  oil  at  an  average  rate  of  $53.39  per  barrel  maturing  in  2019  to  2020.   The   Company   enters   into   total   return   swaps   (“TRS”)   as   economic   hedges   of   the   Company’s   deferred   share   units   and   cash-­‐settled   restricted  share  units.    Hedge  accounting  was  not  applied  to  the  TRSs.    At  December  31,  2017,  5,695,000  TRS  units  were  outstanding.       Fair  value  of  derivative  instruments   The  fair  values  of  derivative  instruments  are  noted  in  the  table  below:   Foreign  currency  forward  and  collar  contracts $                                                     6.1 $                                                     8.9 (in  millions) Asset  (liability) Energy  swap  contracts Total  return  swap  contracts As  at, December  31, 2017 2016 12.9 0.6 12.3 (6.2) $                                               19.6 $                                               15.0 36   The  Company  is  from  time  to  time  involved  in  legal  proceedings,  arising  in  the  ordinary  course  of  its  business.  Typically,  the  amount   of  ultimate  liability  with  respect  to  these  actions  will  not,  in  the  opinion  of  management,  materially  affect  Kinross’  financial  position,   results  of  operations  or  cash  flows.     Maricunga  regulatory  proceedings   In  late  2013,  Compania  Minera  Maricunga  (“CMM”)  was  fined  approximately  $40,000  in  respect  of  the  degradation  of  the  Pantanillo   wetland   located   near   the   Maricunga   mine’s   water   pumping   wells.   CMM   paid   the   fine,   as   required,   and   sought   governmental   approval  of  remedial  action  plans  aimed  at  addressing  the  degradation.    CMM’s  remedial  action  plans  were  not  fully  approved  and   only   a   subset   of   CMM’s   planned   activities   were   allowed   to   be   implemented.     In   May   2015,   the   Chile   environmental   enforcement   authority   (“the   SMA”)   issued   a   resolution   alleging   that   CMM   had   irreparably   harmed   portions   of   the   Pantanillo   wetland   and   two   other  downstream  wetlands  known  respectively  as  Valle  Ancho  and  Barros  Negros,  and  that  the  mine’s  continuing  water  use  poses   an  imminent  risk  to  those  wetlands.  In  response,  CMM  submitted  legal  and  technical  defenses,  expert  reports  and  other  materials   challenging   the   SMA’s   allegations,   and,   complied   with   various   information   requests   from   the   SMA.   On   March   18,   2016,   the   SMA   issued   a   resolution   against   CMM   in   respect   of   the   SMA’s   May   2015   allegations   regarding   the   Valle   Ancho   wetland,   located   approximately   7   kilometresdowngradient   from   CMM’s   groundwater   wells   supplying   water   to   the   operation,   seeking   to   impose   a   sanction   of   an   immediate   complete   curtailment   of   water   use   from   the   groundwater   wells   and   related   aquifer   (the   “sanction   proceedings”).  Beginning  in  May  2016,  the  SMA  issued  a  series  of  resolutions  ordering  CMM  to  “temporarily”  curtail  the  pumping  of   water  from  the  groundwater  wells.  In  response,  CMM  suspended  mining  and  crushing  activities  and  reduced  water  consumption  to   minimal  levels.  CMM  contested  these  resolutions  by  seeking  reconsideration  with  the  SMA  and  appealing  to  Chile’s  Environmental   Tribunal,   but   its   efforts   were   unsuccessful   and,   except   for   a   short   period   of   time   in   July   2016,   the   Company’s   operations   have   remained  suspended.  On  June  24,  2016,  the  SMA  amended  its  initial  sanction  (the  “Amended  Sanction”).  The  terms  of  the  Amended   Sanction     effectively   required   CMM   to   cease   operations   and   close   the   mine,   with   water   use   curtailed   to   levels   far   below   those   required  for  closure  in  compliance  with  the  mine’s  government-­‐approved  plan.  On  July  9,  2016,  CMM  filed  its  appeal  in  the  sanction   proceedings.   As   part   of   its   appeal,   CMM   submitted   legal   and   technical   arguments   and   reports   by   experts   on   wetland   vegetation,   analysis  of  long-­‐term  satellite  imagery  and  groundwater  hydrology  criticizing  the  evidence  relied  upon  by  the  SMA  and  concluding   that  current  data  does  not  support  an  assertion  that  CMM’s  pumping  is  negatively  impacting  water  levels  7  kilometresdowngradient   at  the  Valle  Ancho  wetland.  On  August  30,  2016,  CMM  submitted  a  request  to  the  Environmental  Tribunal  that  it  issue  an  injunction   suspending   the   effectiveness   of   the   Amended   Sanction   pending   a   final   decision   on   the   merits   of   CMM’s   appeal   of   the   Amended   Sanction.   On   September   16,   2016,   the   Environmental   Tribunal   rejected   CMM’s   injunction   request.   On   August   7,   2017,   the   Environmental   Tribunal   upheld   the   SMA’s   Amended   Sanction   and   curtailment   orders   on   purely   procedural   grounds.     No   findings   were  made  by  the  Tribunal  on  the  issue  of  whether  CMM’s  pumping  caused  damage  to  area  wetlands,  as  alleged  by  the  SMA.    On   September  27,  2017,  CMM  appealed  the  matter  to  the  Supreme  Court  of  Chile,  which  accepted  the  appeal  on  December  14,  2017.     The  timing  of  any  substantive  decision  by  the  Supreme  Court  is  uncertain.         On  June  2,  2016,  CMM  was  served  with  two  separate  lawsuits  filed  by  the  Chilean  State  Defense  Counsel.  Both  lawsuits  are  based   upon  allegations  that  CMM’s  pumping  from  its  Pantanillo  area  groundwater  wells  has  caused  damage  to  area  wetlands.  One  action   relates  to  the  Pantanillo  wetland,  and  is  based  upon  the  sanction  imposed  upon  CMM  in  late  2013  (as  described  above).  The  other   action   relates   to   the   Valle   Ancho   wetland,   and   is   largely   based   upon   the   same   factual   assertions   at   issue   in   the   SMA   sanction   proceedings.   These   lawsuits   seek,   among   other   things,   to   require   CMM   to   cease   pumping   from   the   groundwater   wells,   finance   various  investigations  and  conduct  restoration  activities.  On  June  20,  2016,  CMM  filed  its  defenses.    Evidentiary  hearings  before  the   Environmental   Tribunal   occurred   in   2016   and   early   2017,   and   closing   arguments   occurred   in   December   2017.     The   timing   of   any   substantive  decision  by  the  Environmental  Tribunal  is  uncertain.     On   May   19,   2017,   a   release   of   diesel   fuel   occurred   from   a   power   generation   area   of   the   Rancho   del   Gallo   Camp.   The   release   occurred  when  a  pipe  valve  attached  to  a  fuel  tank  was  opened  by  an  unknown  party,  effectively  draining  the  tank.  CMM  estimates   that  approximately  15,000  litres  of  diesel  escaped  containment  affecting  the  surrounding  soil  and  a  nearby  stream.  After  discovering   the  release,  CMM  commenced  actions  designed  to  contain  the  release,  including  mobilization  of  a  third-­‐party  response  team,  and   has  addressed  both  localized  and  downstream  impacts  of  the  release.  CMM  notified  the  relevant  authorities  of  the  release,  and  has   kept  them  informed  of  its  response  activities.  Various  agencies,  including  the  SMA,  have  reviewed,  or  are  reviewing  the  situation  and   have  requested  information  from  CMM.  Further,  the  SEC  (Superintendencia  de  Electridad  y  Combustibles),  the  agency  that  regulates   fuel  facilities  and  electrical  power,  commenced  an  administrative  action  against  CMM  for  alleged  regulatory  non-­‐compliances  at  the   facility.  The  SEC  action,  or  other  legal  actions  relating  to  the  release,  could  result  in  the  imposition  of  fines  or  other  sanctions  against   CMM  or  its  employees.   37 KINROSS ANNUAL REPORT MDA 37                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   previously  entered  into  by  Crown  and  the  WDOE  in  June  2013  (the  “Settlement  Agreement”).  On  February  28,  2014,  Crown  filed  an   appeal  of  the  Renewed  Permit  with  the  Washington  Pollution  Control  Hearings  Board  (“PCHB”).  In  addition,  on  January  15,  2015,   Crown   filed   a   lawsuit   against   the   WDOE   in   Ferry   County   Superior   Court,   Washington,   claiming   that   the   WDOE   breached   the   Settlement  Agreement  by  including  various  unworkable  compliance  terms  in  the  Renewed  Permit  (the  “Crown  Action”).  On  July  30,   2015,   the   PCHB   upheld   the   Renewed   Permit.   Crown   filed   a   Petition   for   Review   in   Ferry   County   Superior   Court,   Washington,   on   August  27,  2015,  seeking  to  have  the  PCHB  decision  overturned.  On  March  13,  2017,  the  Ferry  County  Superior  Court  upheld  the   PCHB’s  decision.  On  April  12,  2017,  Crown  appealed  the  Ferry  County  Superior  Court’s  ruling  to  the  State  of  Washington  Court  of   Appeals,  where  the  matter  remains  pending.     On   July   19,   2016,   the   WDOE   issued   an   Administrative   Order   (“AO”)   to   Crown   and   Kinross   Gold   Corporation   asserting   that   the   companies  had  exceeded  the  discharge  limits  in  the  Renewed  Permit  a  total  of  931  times  and  has  also  failed  to  maintain  the  capture   zone   required   under   the   Renewed   Permit.   The   AO   orders   the   companies   to   develop   an   action   plan   to   capture   and   treat   water   escaping  the  capture  zone,  undertake  various  investigations  and  studies,  revise  its  Adaptive  Management  Plan,  and  report  findings   by   various   deadlines   in   the   fourth   quarter   2016.   The   companies   timely   made   the   required   submittals.     On   August   17,   2016,   the   companies  filed  an  appeal  of  the  AO  with  the  PCHB  (the  “AO  Appeal”).  Because  the  AO  Appeal  raises  many  of  the  same  issues  that   have   been   raised   in   the   Appeal   and   Crown   Action,   the   companies   and   WDOE   agreed   to   stay   the   AO   Appeal   indefinitely   to   allow   these  matters  to  be  resolved.   The  PCHB  granted  the  request  for  stay  on   August  26,  2016.  The  stay  is  affirmed  by  the  PCHB  upon   receipt  of  applicable  filings.  The  stay  was  most  recently  affirmed  on  January  30,  2018.   On   November   30,   2017,   the   WDOE   issued   a   Notice   of   Violation   (“NOV”)   to   Crown   and   Kinross   asserting   that   the   companies   had   exceeded   the   discharge   limits   in   the   Permit   a   total   of   113   times   during   the   3rd   quarter   of   2017   and   also   failed   to   maintain   the   capture  zone  as  required  under  the  Permit.    The  NOV  ordered  the  companies  to  file  a  report  with  WDOE  identifying  the  steps  which   have  been  and  are  being  taken  to  “control  such  waste  or  pollution  or  otherwise  comply  with  this  determination,”  which  report  was   filed  on  January  19,  2018.    Following  its  review  of  this  report,  WDOE  may  issue  an  AO  or  other  directives  to  the  Company.    The  NOV   is  not  immediately  appealable,  but  any  subsequent  AO  or  other  directive  relating  to  the  NOV  may  be  appealed,  as  appropriate.       Crown  also  faces  potential  legal  actions  by  non-­‐governmental  organizations  relating  to  the  Permit  and  the  renewed  Permit.  In  the   past,  Crown  and  Kinross  Gold  U.S.A.,  Inc.  have  received  Notice  of  Intent  to  Sue  letters  from  the  Okanogan  Highlands  Alliance  (“OHA”)   advising  that  it  intends  to  file  a  citizen’s  suit  against  Crown  under  the  CWA  for  alleged  violations  of  the  Permit,  renewed  Permit  and   the  CWA,  including  failure  to  adequately  capture  and  treat  mine-­‐impacted  groundwater  and  surface  water  at  the  site  in  violation  of   the  Permit  and  renewed  Permit.  OHA’s  notice  letters  further  recite  that  the  CWA  authorizes  injunctive  relief  and  civil  penalties  in  the   amount  of  up  to  $37,500  per  day  per  violation.  However,  to  date,  OHA  has  not  filed  a  lawsuit.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   La  Coipa  permit  proceedings   MDO   suspended   operations   at   the   La   Coipa   mine   in   the   fourth   quarter   of   2013,   in   accordance   with   the   mine’s   permit   MDO   continued  its  water  treatment  program  (“WTP”)  to  remediate  levels  of  mercury  in  the  ground  water  due  to  seepage  from  its  tailing   facility.  La  Coipa’s  WTP,  related  facilities  and  monitoring  program,  including  downstream  monitoring  wells,  have  been  in  place  since   2000.  The  mine’s  groundwater  treatment  permit  establishes  a  very  low  standard  for  mercury  of  1  part  per  billion.  The  La  Coipa  mine   has  four  monitoring  wells  at  or  near  its  downstream  property  boundary  at  which  exceedance  of  the  permitted  standards  have  not   been  detected.   In   2015,   the   SMA   conducted   an   inspection   of   the   WTP   and   monitoring   wells   and   requested   certain   information   regarding   those   facilities   and   their   performance,   with   which   MDO   fully   cooperated.   On   March   16,   2016,   the   SMA   issued   a   resolution   alleging   violations  under  the  WTP.  The  resolution  specified  a  total  of  seven  charges,  alleging  permit  violations  at  the  WTP  and/or  failure  to   properly  permit  certain  related  activities,  including  capturing  water  at  an  undesignated  reservoir,  deficiencies  in  the  mercury  capture   system,  deficiencies  in  the  monitoring  system,  WTP  effluent  samples  from  2013  above  the  permitted  standard,  and  WTP  monitoring   well  samples  from  2013  and  2014  above  the  permitted  standard.  On  April  15,  2016,  MDO  submitted  a  compliance  plan  to  remediate   the  alleged  permit  violations  which,  following  further  submissions  to  the  SMA,  was  ultimately  accepted  on  July  7,  2016.  As  a  result,   the   sanctioning   process   has   been   suspended   without   any   fine   or   other   penalty   to   MDO   provided   the   plan   is   implemented   and   maintained  per  its  terms.  Failure  to  comply  with  the  plan  will  re-­‐initiate  the  sanction  process  and  could  result  in  doubled  fines  of  up   to  $7.7  million  per  alleged  minor  violation  (five  in  total)  and  $15.4  million  per  alleged  serious  violation  (two  in  total).     On   October   14,   2016,   six   members   of   a   local   indigenous   community   commenced   an   action   in   the   Copiapo   Court   of   Appeals   challenging  the  recent  approval  of  the  DIA  permit  for  La  Coipa’s  Phase  7  project.  On  January  13,  2017,  the  Court  of  Appeals  rejected   the  legal  challenge,  which  the  plaintiffs  have  not  appealed  and  their  right  to  do  so  has  lapsed.  As  with  any  permit,  the  Phase  7  DIA  is   open  to  challenge  in  other  venues,  which  the  Company  will  vigorously  oppose.    If  such  a  challenge  were  brought  and  successful  in  its   ultimate  disposition,  the  DIA  could  be  revoked,  requiring  the  mine  to  undertake  a  more  rigorous  and  lengthy  Environmental  Impact   Study,  which  in  approving  the  DIA  the  Chilean  environmental  permitting  authority  had  deemed  unnecessary.   Sunnyside  litigation   The  Sunnyside  Mine  is  an  inactive  mine  situated  in  the  so-­‐called  Bonita  Peak  Mining  District  (“District”)  near  Silverton,  Colorado.  A   subsidiary   of   Kinross,   Sunnyside   Gold   Corporation   ("SGC"),   was   involved   in   operations   at   the   mine   from   1985   through   1991   and   subsequently  conducted  various  reclamation  and  closure  activities  at  the  mine  and  in  the  surrounding  area.  In  the  third  quarter  of   2016,  the  Environmental  Protection  Agency  (the  “EPA”)  listed  the  District,  including  areas  impacted  by  SGC’s  operations  and  closure   activities,  on  the  National  Priorities  List  pursuant  to  the  Comprehensive  Environmental  Response,  Compensation,  and  Liability  Act   (“CERCLA”).  SGC  has  challenged  portions  of  the  CERCLA  listing  in  the  United  States  Court  of  Appeals  for  District  of  Columbia  Circuit.   The  EPA  has  notified  SGC  that  SGC  is  a  potentially  responsible  party  under  CERCLA  and  may  be  jointly  and  severally  liable  for  cleanup   of  the  District  or  cleanup  costs  incurred  by  the  EPA  in  the  District.  The  EPA  may  in  the  future  provide  similar  notification  to  Kinross.   On  August  5,  2015,  while  working  in  another  mine  in  the  District  known  as  the  Gold  King,  the  EPA  caused  a  release  of  approximately   three  million  gallons  of  contaminated  water  into  a  tributary  of  the  Animas  River.   In  the  second  quarter  of  2016,  the  State  of  New   Mexico   filed   a   Complaint   naming   the   EPA,   SGC,   Kinross   and   others   alleging   violations   of   CERCLA,   the   Resource   Conservation   and   Recovery  Act  (“RCRA”),  and  the  Clean  Water  Act  (“CWA”)  and  claiming  negligence,  gross  negligence,  public  nuisance  and  trespass.   The  Complaint  seeks  cost  recovery,  damages,  injunctive  relief,  and  attorney’s  fees.  In  the  third  quarter  of  2016,  the  Navajo  Nation   initiated  litigation  against  the  EPA,  SGC  and  Kinross,  alleging  entitlement  to  cost  recovery  under  CERCLA  for  past  and  future  costs   incurred,   negligence,   gross   negligence,   trespass,   and   public   and   private   nuisance,   and   seeking   reimbursement   of   past   and   future   costs,  compensatory,  consequential  and  punitive  damages,  injunctive  relief  and  attorneys’  fees.  The  suits  brought  by  New  Mexico   and  the  Navajo  Nation  have  been  consolidated.  In  the  third  quarter  of  2017,  the  State  of  Utah  filed  a  Complaint  naming  SGC,  Kinross   and  others  alleging  negligence,  gross  negligence,  public  nuisance,  trespass,  and  violation  of  the  Utah  Water  Quality  Act  and  the  Utah   Solid  and  Hazardous  Waste  Act.  The  Complaint  seeks  cost  recovery,  compensatory,  consequential  and  punitive  damages,  penalties,   disgorgement  of  profits,  declaratory,  injunctive  and  other  relief  under  CERCLA,  attorney’s  fees,  and  costs.     Kettle  River-­‐Buckhorn  regulatory  proceedings   Crown  Resources  Corporation  (“Crown”)  is  the  holder  of  a  waste  discharge  permit  (the  “Permit”)  in  respect  of  the  Buckhorn  Mine,   which   authorizes   and   regulates   mine-­‐related   discharges   from   the   mine   and   its   water   treatment   plant.   On   February   27,   2014,   the   Washington   Department   of   Ecology   (the   “WDOE”)   renewed   the   Buckhorn   Mine’s   National   Pollution   Discharge   Elimination   System   Permit  (the  “Renewed  Permit”),  with  an  effective  date  of  March  1,  2014.  The  Renewed  Permit  contained  conditions  that  were  more   restrictive   than   the   original   discharge   permit.   In   addition,   the   Crown   felt   that   the   Renewed   Permit   was   internally   inconsistent,   technically   unworkable   and   inconsistent   with   existing   agreements   in   place   with   the   WDOE,   including   a   settlement   agreement   38 KINROSS ANNUAL REPORT MDA 38 39                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   previously  entered  into  by  Crown  and  the  WDOE  in  June  2013  (the  “Settlement  Agreement”).  On  February  28,  2014,  Crown  filed  an   appeal  of  the  Renewed  Permit  with  the  Washington  Pollution  Control  Hearings  Board  (“PCHB”).  In  addition,  on  January  15,  2015,   Crown   filed   a   lawsuit   against   the   WDOE   in   Ferry   County   Superior   Court,   Washington,   claiming   that   the   WDOE   breached   the   Settlement  Agreement  by  including  various  unworkable  compliance  terms  in  the  Renewed  Permit  (the  “Crown  Action”).  On  July  30,   2015,   the   PCHB   upheld   the   Renewed   Permit.   Crown   filed   a   Petition   for   Review   in   Ferry   County   Superior   Court,   Washington,   on   August  27,  2015,  seeking  to  have  the  PCHB  decision  overturned.  On  March  13,  2017,  the  Ferry  County  Superior  Court  upheld  the   PCHB’s  decision.  On  April  12,  2017,  Crown  appealed  the  Ferry  County  Superior  Court’s  ruling  to  the  State  of  Washington  Court  of   Appeals,  where  the  matter  remains  pending.     On   July   19,   2016,   the   WDOE   issued   an   Administrative   Order   (“AO”)   to   Crown   and   Kinross   Gold   Corporation   asserting   that   the   companies  had  exceeded  the  discharge  limits  in  the  Renewed  Permit  a  total  of  931  times  and  has  also  failed  to  maintain  the  capture   zone   required   under   the   Renewed   Permit.   The   AO   orders   the   companies   to   develop   an   action   plan   to   capture   and   treat   water   escaping  the  capture  zone,  undertake  various  investigations  and  studies,  revise  its  Adaptive  Management  Plan,  and  report  findings   by   various   deadlines   in   the   fourth   quarter   2016.   The   companies   timely   made   the   required   submittals.     On   August   17,   2016,   the   companies  filed  an  appeal  of  the  AO  with  the  PCHB  (the  “AO  Appeal”).  Because  the  AO  Appeal  raises  many  of  the  same  issues  that   have   been   raised   in   the   Appeal   and   Crown   Action,   the   companies   and   WDOE   agreed   to   stay   the   AO   Appeal   indefinitely   to   allow   these  matters  to  be  resolved.   The  PCHB  granted  the  request  for  stay  on   August  26,  2016.  The  stay  is  affirmed  by  the  PCHB  upon   receipt  of  applicable  filings.  The  stay  was  most  recently  affirmed  on  January  30,  2018.   On   November   30,   2017,   the   WDOE   issued   a   Notice   of   Violation   (“NOV”)   to   Crown   and   Kinross   asserting   that   the   companies   had   exceeded   the   discharge   limits   in   the   Permit   a   total   of   113   times   during   the   3rd   quarter   of   2017   and   also   failed   to   maintain   the   capture  zone  as  required  under  the  Permit.    The  NOV  ordered  the  companies  to  file  a  report  with  WDOE  identifying  the  steps  which   have  been  and  are  being  taken  to  “control  such  waste  or  pollution  or  otherwise  comply  with  this  determination,”  which  report  was   filed  on  January  19,  2018.    Following  its  review  of  this  report,  WDOE  may  issue  an  AO  or  other  directives  to  the  Company.    The  NOV   is  not  immediately  appealable,  but  any  subsequent  AO  or  other  directive  relating  to  the  NOV  may  be  appealed,  as  appropriate.       Crown  also  faces  potential  legal  actions  by  non-­‐governmental  organizations  relating  to  the  Permit  and  the  renewed  Permit.  In  the   past,  Crown  and  Kinross  Gold  U.S.A.,  Inc.  have  received  Notice  of  Intent  to  Sue  letters  from  the  Okanogan  Highlands  Alliance  (“OHA”)   advising  that  it  intends  to  file  a  citizen’s  suit  against  Crown  under  the  CWA  for  alleged  violations  of  the  Permit,  renewed  Permit  and   the  CWA,  including  failure  to  adequately  capture  and  treat  mine-­‐impacted  groundwater  and  surface  water  at  the  site  in  violation  of   the  Permit  and  renewed  Permit.  OHA’s  notice  letters  further  recite  that  the  CWA  authorizes  injunctive  relief  and  civil  penalties  in  the   amount  of  up  to  $37,500  per  day  per  violation.  However,  to  date,  OHA  has  not  filed  a  lawsuit.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   La  Coipa  permit  proceedings   MDO   suspended   operations   at   the   La   Coipa   mine   in   the   fourth   quarter   of   2013,   in   accordance   with   the   mine’s   permit   MDO   continued  its  water  treatment  program  (“WTP”)  to  remediate  levels  of  mercury  in  the  ground  water  due  to  seepage  from  its  tailing   facility.  La  Coipa’s  WTP,  related  facilities  and  monitoring  program,  including  downstream  monitoring  wells,  have  been  in  place  since   2000.  The  mine’s  groundwater  treatment  permit  establishes  a  very  low  standard  for  mercury  of  1  part  per  billion.  The  La  Coipa  mine   has  four  monitoring  wells  at  or  near  its  downstream  property  boundary  at  which  exceedance  of  the  permitted  standards  have  not   been  detected.   In   2015,   the   SMA   conducted   an   inspection   of   the   WTP   and   monitoring   wells   and   requested   certain   information   regarding   those   facilities   and   their   performance,   with   which   MDO   fully   cooperated.   On   March   16,   2016,   the   SMA   issued   a   resolution   alleging   violations  under  the  WTP.  The  resolution  specified  a  total  of  seven  charges,  alleging  permit  violations  at  the  WTP  and/or  failure  to   properly  permit  certain  related  activities,  including  capturing  water  at  an  undesignated  reservoir,  deficiencies  in  the  mercury  capture   system,  deficiencies  in  the  monitoring  system,  WTP  effluent  samples  from  2013  above  the  permitted  standard,  and  WTP  monitoring   well  samples  from  2013  and  2014  above  the  permitted  standard.  On  April  15,  2016,  MDO  submitted  a  compliance  plan  to  remediate   the  alleged  permit  violations  which,  following  further  submissions  to  the  SMA,  was  ultimately  accepted  on  July  7,  2016.  As  a  result,   the   sanctioning   process   has   been   suspended   without   any   fine   or   other   penalty   to   MDO   provided   the   plan   is   implemented   and   maintained  per  its  terms.  Failure  to  comply  with  the  plan  will  re-­‐initiate  the  sanction  process  and  could  result  in  doubled  fines  of  up   to  $7.7  million  per  alleged  minor  violation  (five  in  total)  and  $15.4  million  per  alleged  serious  violation  (two  in  total).     On   October   14,   2016,   six   members   of   a   local   indigenous   community   commenced   an   action   in   the   Copiapo   Court   of   Appeals   challenging  the  recent  approval  of  the  DIA  permit  for  La  Coipa’s  Phase  7  project.  On  January  13,  2017,  the  Court  of  Appeals  rejected   the  legal  challenge,  which  the  plaintiffs  have  not  appealed  and  their  right  to  do  so  has  lapsed.  As  with  any  permit,  the  Phase  7  DIA  is   open  to  challenge  in  other  venues,  which  the  Company  will  vigorously  oppose.    If  such  a  challenge  were  brought  and  successful  in  its   ultimate  disposition,  the  DIA  could  be  revoked,  requiring  the  mine  to  undertake  a  more  rigorous  and  lengthy  Environmental  Impact   Study,  which  in  approving  the  DIA  the  Chilean  environmental  permitting  authority  had  deemed  unnecessary.   Sunnyside  litigation   The  Sunnyside  Mine  is  an  inactive  mine  situated  in  the  so-­‐called  Bonita  Peak  Mining  District  (“District”)  near  Silverton,  Colorado.  A   subsidiary   of   Kinross,   Sunnyside   Gold   Corporation   ("SGC"),   was   involved   in   operations   at   the   mine   from   1985   through   1991   and   subsequently  conducted  various  reclamation  and  closure  activities  at  the  mine  and  in  the  surrounding  area.  In  the  third  quarter  of   2016,  the  Environmental  Protection  Agency  (the  “EPA”)  listed  the  District,  including  areas  impacted  by  SGC’s  operations  and  closure   activities,  on  the  National  Priorities  List  pursuant  to  the  Comprehensive  Environmental  Response,  Compensation,  and  Liability  Act   (“CERCLA”).  SGC  has  challenged  portions  of  the  CERCLA  listing  in  the  United  States  Court  of  Appeals  for  District  of  Columbia  Circuit.   The  EPA  has  notified  SGC  that  SGC  is  a  potentially  responsible  party  under  CERCLA  and  may  be  jointly  and  severally  liable  for  cleanup   of  the  District  or  cleanup  costs  incurred  by  the  EPA  in  the  District.  The  EPA  may  in  the  future  provide  similar  notification  to  Kinross.   On  August  5,  2015,  while  working  in  another  mine  in  the  District  known  as  the  Gold  King,  the  EPA  caused  a  release  of  approximately   three  million  gallons  of  contaminated  water  into  a  tributary  of  the  Animas  River.   In  the  second  quarter  of  2016,  the  State  of  New   Mexico   filed   a   Complaint   naming   the   EPA,   SGC,   Kinross   and   others   alleging   violations   of   CERCLA,   the   Resource   Conservation   and   Recovery  Act  (“RCRA”),  and  the  Clean  Water  Act  (“CWA”)  and  claiming  negligence,  gross  negligence,  public  nuisance  and  trespass.   The  Complaint  seeks  cost  recovery,  damages,  injunctive  relief,  and  attorney’s  fees.  In  the  third  quarter  of  2016,  the  Navajo  Nation   initiated  litigation  against  the  EPA,  SGC  and  Kinross,  alleging  entitlement  to  cost  recovery  under  CERCLA  for  past  and  future  costs   incurred,   negligence,   gross   negligence,   trespass,   and   public   and   private   nuisance,   and   seeking   reimbursement   of   past   and   future   costs,  compensatory,  consequential  and  punitive  damages,  injunctive  relief  and  attorneys’  fees.  The  suits  brought  by  New  Mexico   and  the  Navajo  Nation  have  been  consolidated.  In  the  third  quarter  of  2017,  the  State  of  Utah  filed  a  Complaint  naming  SGC,  Kinross   and  others  alleging  negligence,  gross  negligence,  public  nuisance,  trespass,  and  violation  of  the  Utah  Water  Quality  Act  and  the  Utah   Solid  and  Hazardous  Waste  Act.  The  Complaint  seeks  cost  recovery,  compensatory,  consequential  and  punitive  damages,  penalties,   disgorgement  of  profits,  declaratory,  injunctive  and  other  relief  under  CERCLA,  attorney’s  fees,  and  costs.     Kettle  River-­‐Buckhorn  regulatory  proceedings   Crown  Resources  Corporation  (“Crown”)  is  the  holder  of  a  waste  discharge  permit  (the  “Permit”)  in  respect  of  the  Buckhorn  Mine,   which   authorizes   and   regulates   mine-­‐related   discharges   from   the   mine   and   its   water   treatment   plant.   On   February   27,   2014,   the   Washington   Department   of   Ecology   (the   “WDOE”)   renewed   the   Buckhorn   Mine’s   National   Pollution   Discharge   Elimination   System   Permit  (the  “Renewed  Permit”),  with  an  effective  date  of  March  1,  2014.  The  Renewed  Permit  contained  conditions  that  were  more   restrictive   than   the   original   discharge   permit.   In   addition,   the   Crown   felt   that   the   Renewed   Permit   was   internally   inconsistent,   technically   unworkable   and   inconsistent   with   existing   agreements   in   place   with   the   WDOE,   including   a   settlement   agreement   38 39 KINROSS ANNUAL REPORT MDA 39                         KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   7. SUMMARY  OF  QUARTERLY  INFORMATION     (in  millions,  except  per  share  amounts) Q4 2017 Q3 Q2Q4 Q1 Q4 2016 Q3 Q2 Q1  (a) Metal  sales   Net  earnings  (loss)  attributable  to   common  shareholders Basic  earnings  (loss)  per  share   attributable  to  common  shareholders Diluted  earnings  (loss)  per  share   attributable  to  common  shareholders Net  cash  flow  provided  from  operating   activities $                               810.3 $                               828.0 $                                       868.6 $                               796.1 $                               902.8 $                               910.2 $                     876.4 $                           782.6 $                               217.6 $                                     60.1 $                                             33.1 $                               134.6 $                           (116.5) $                                           2.5 $                       (25.0) $                                 35.0 $                                     0.17 $                                     0.05 $                                             0.03 $                                     0.11 $                                 (0.09) $                                0.00 $                       (0.02) $                                 0.03 $                                     0.17 $                                     0.05 $                                             0.03 $                                     0.11 $                                 (0.09) $                                0.00 $                       (0.02) $                                 0.03 $                               366.4 $                               197.7 $                                       179.7 $                               207.8 $                               302.6 $                               266.2 $                     315.9 $                           214.5 (a)    The  interim  financial  statements  for  the  three  months  ended  March  31,  2016,  were  recast  to  reflect  the  retrospective  impact  of  the  finalization  of  the  purchase  price   allocation    of    the  acquisition  of    Bald  Mountain    and    50%    of  Round  Mountain. The  Company’s  results  over  the  past  several  quarters  have  been  driven  primarily  by  fluctuations  in  the  gold  price,  input  costs  and   changes  in  gold  equivalent  ounces  sold.    Fluctuations  in  the  silver  price  have  also  affected  results.       During  the  fourth  quarter  of  2017,  revenue  decreased  to  $810.3  million  on  total  gold  equivalent  ounces  sold  of  634,762  compared   with   $902.8   million   on   sales   of   743,427   total   gold   equivalent   ounces   during   the   fourth   quarter   of   2016.     The   average   gold   price   realized  in  the  fourth  quarter  of  2017  was  $1,276  per  ounce  compared  with  $1,217  per  ounce  in  the  fourth  quarter  of  2016.     Production  cost  of  sales  decreased  to  $414.5  million  compared  with  $529.4  million  in  the  same  period  of  2016,  primarily  due  to  a   decrease  in  gold  equivalent  ounces  sold  and  lower  costs  realized  at  Fort  Knox.     Fluctuations  in  foreign  exchange  rates  have  also  affected  results.    Depreciation,  depletion  and  amortization  varied  between  each  of   the   above   quarters   largely   due   to   changes   in   gold   equivalent   ounces   sold   and   depreciable   asset   bases.     In   addition,   changes   in   mineral  reserves  during  each  of  these  years  affected  depreciation,  depletion  and  amortization  for  quarters  in  the  subsequent  year.   On  March  28,  2017,  the  Company  announced  that  it  entered  into  an  agreement  with  Goldcorp  to  sell  its  25%  interest  in  the  Cerro   Casale  project  and  its  100%  interest  in  the  Quebrada  Seca  exploration  project  in  Chile.  On  June  9,  2017,  the  Company  completed  the   sale   for   gross   cash   proceeds   of   $260.0   million   (which   included   $20.0   million   for   Quebrada   Seca).   In   connection   with   the   sale,   the   Company  recognized  a  gain  on  disposition  of  $12.7  million  during  the  three  months  ended  June  30,  2017.     On   May   18,   2017,   the   Company   entered   into   an   agreement   with   White   Gold   Corp.   to   sell   its   100%   interest   in   the   White   Gold   exploration  project  in  the  Yukon  Territory.  On  June  14,  2017,  the  Company  completed  the  sale  and  recognized  a  loss  on  disposition   of  $1.7  million  for  the  three  months  ended  June  30,  2017.     On  September  18,  2017,  the  Company  entered  into  an  agreement  with  Integra  to  sell  its  100%  interest  in  DeLamar.  On  November  3,   2017,  the  Company  completed  the  sale  and  recognized  a  gain  of  $44.2  million.   In  the  fourth  quarter  of  2017,  the  Company  recorded  a  net,  after-­‐tax,  impairment  reversal  of  $62.1  million  related  to  impairment   reversals  at  its  Tasiast  and  Fort  Knox  CGUs,  offset  by  an  impairment  charge  at  its  Paracatu  CGU.   During  the  third  quarter  of  2016,  the  Company  recorded  an  impairment  charge  of  $139.6  million  relating  to  its  Maricunga  CGU  as  a   result  of  the  suspension  of  mining  and  crushing  activities.  The  impairment  charge  included  $68.3  million  related  to  property,  plant   and  equipment  and  $71.3  million  related  to  inventory.     On  January  11,  2016,  Kinross  completed  the  acquisition  of  Bald  Mountain  and  the  remaining  50%  interest  in  Round  Mountain  from   Barrick  for  $610.0  million  in  cash,  subject  to  a  working  capital  adjustment.  In  April  2016,  the  Company  received  $22.0  million  in  cash   from  Barrick  in  connection  with  the  working  capital  adjustment,  which  reduced  the  final  purchase  price  to  $588.0  million.   Net  operating  cash  flows  increased  to  $366.4  million  in  the  fourth  quarter  of  2017,  compared  with  $302.6  million  in  the  same  period   of  2016,  primarily  due  to  the  increase  in  margins.   40 KINROSS ANNUAL REPORT MDA 40 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   8. DISCLOSURE  CONTROLS  AND  PROCEDURES  AND  INTERNAL  CONTROL  OVER  FINANCIAL  REPORTING   Pursuant   to   regulations   adopted   by   the   U.S.  Securities   and   Exchange   Commission,   under   the   Sarbanes-­‐Oxley   Act   of   2002   (the   “Sarbanes-­‐Oxley  Act”)  and  those  of  the  Canadian  Securities  Administrators,  Kinross'  management  evaluates  the  effectiveness  of  the   design   and   operation   of   the   Company's   disclosure   controls   and   procedures,   and   internal   control   over   financial   reporting.   This   evaluation  is  done  under  the  supervision  of,  and  with  the  participation  of,  the  Chief  Executive  Officer  and  the  Chief  Financial  Officer.     As  of  the  end  of  the  period  covered  by  this  MD&A  and  the  accompanying  financial  statements,  Kinross’  management  evaluated  the   effectiveness   of   its   disclosure   controls   and   procedures   and   internal   control   over   financial   reporting.     In   making   this   assessment,   management  used  the  criteria  specified  in  Internal  Control  -­‐  Integrated  Framework  (2013)  issued  by  the  Committee  of  Sponsoring   Organizations   of   the   Treadway   Commission.     Based   on   that   evaluation,   the   Chief   Executive   Officer   and   the   Chief   Financial   Officer   have  concluded  that  Kinross’  disclosure  controls  and  procedures,  and  internal  control  over  financial  reporting  were  effective  as  at   December  31,  2017.       Limitations  of  Controls  and  Procedures     Kinross’  management,  including  the  Chief  Executive  Officer  and  the  Chief  Financial  Officer,  believes  that  any  disclosure  controls  and   procedures  and  internal  control  over  financial  reporting,  no  matter  how  well  designed  and  operated,  can  have  inherent  limitations.   Therefore,  even  those  systems  determined  to  be  effective  can  provide  only  reasonable  assurance  that  the  objectives  of  the  control   system  are  met.   9. CRITICAL  ACCOUNTING  POLICIES,  ESTIMATES  AND  ACCOUNTING  CHANGES   Critical  Accounting  Policies  and  Estimates     Critical  accounting  policies  and  estimates  are  disclosed  in  Note  5  of  the  financial  statements.     Recent  accounting  pronouncements  issued  by  the  IASB  are  disclosed  in  Note  4  of  the  financial  statements.     Recent  Accounting  Pronouncements   10. RISK  ANALYSIS   The  business  of  Kinross  contains  significant  risk  due  to  the  nature  of  mining,  exploration,  and  development  activities.    Certain  risk   factors,  including  but  not  limited  to  those  listed  below,  are  similar  across  the  mining  industry  while  others  are  specific  to  Kinross.     The  risk  factors  below  may  include  details  of  how  Kinross  seeks  to  mitigate  these  risks  where  possible.    For  additional  discussion  of   risk  factors  please  refer  to  the  Company's  Annual  Information  Form  for  the  year  ended  December  31,  2016,  which  is  available  on  the   Company's   website www.kinross.com and   on www.sedar.com or   is   available   upon   request   from   the  Company,   and   to   the   Company’s  Annual  Information  Form  for  the  year  ended  December  31,  2017,  which  will  be  filed  on  SEDAR  on  or  about  March  31,   2018.     Gold  Price  and  Silver  Price     The   profitability   of   Kinross'   operations   is   significantly   affected   by   changes   in   the   market   price   of   gold   and   silver.     Gold   and   silver       prices  fluctuate  on  a  daily  basis  and  are  affected  by  numerous  factors  beyond  the  control  of  Kinross.    The  price  of  gold  and/or  silver   can   be   subject   to   volatile   price   movements   and   future   serious   price   declines   could   cause   continued   commercial   production   to   be   impractical.    Depending  on  the  prices  of  gold  and  silver,  cash  flow  from  mining  operations  may  not  be  sufficient  to  cover  costs  of   production  and  capital  expenditures.    If,  as  a  result  of  a  decline  in  gold  and/or  silver  prices,  revenues  from  metal  sales  were  to  fall   below   cash   operating   costs,   production   may   be   discontinued.     The   factors   that   may   affect   the   price   of   gold   and   silver   include   industry  factors  such  as:  industrial  and  jewelry  demand;  the  level  of  demand  for  the  metal  as  an  investment;  central  bank  lending,   sales  and  purchases  of  the  metal;  speculative  trading;  and  costs  of  and  levels  of  global  production  by  producers  of  the  metal.    Gold   and  silver  prices  may  also  be  affected  by  macroeconomic  factors,  including:  expectations  of  the  future  rate  of  inflation;  the  strength   of,  and  confidence  in,  the  U.S.  dollar,  the  currency  in  which  the  price  of  the  metal  is  generally  quoted,  and  other  currencies;  interest   rates;  and  global  or  regional  political  or  economic  uncertainties.     In   2017,   the   Company’s   average   realized   gold   price   increased   to   $1,260   per   ounce   from   $1,249   per   ounce   in   2016.     If   the   world   market  price  of  gold  and/or  silver  continued  to  drop  and  the  prices  realized  by  Kinross  on  gold  and/or  silver  sales  were  to  decrease   further  and  remain  at  such  a  level  for  any  substantial  period,  Kinross'  profitability  and  cash  flow  would  be  negatively  affected.    In   41                                                       KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   7. SUMMARY  OF  QUARTERLY  INFORMATION     (in  millions,  except  per  share  amounts) Q4 Q2Q4 Q1 Q4 Q2 Q1  (a) Metal  sales   $                               810.3 $                               828.0 $                                       868.6 $                               796.1 $                               902.8 $                               910.2 $                     876.4 $                           782.6 2017 Q3 2016 Q3 common  shareholders $                               217.6 $                                     60.1 $                                             33.1 $                               134.6 $                           (116.5) $                                           2.5 $                       (25.0) $                                 35.0 attributable  to  common  shareholders $                                     0.17 $                                     0.05 $                                             0.03 $                                     0.11 $                                 (0.09) $                                0.00 $                       (0.02) $                                 0.03 attributable  to  common  shareholders $                                     0.17 $                                     0.05 $                                             0.03 $                                     0.11 $                                 (0.09) $                                0.00 $                       (0.02) $                                 0.03 Net  earnings  (loss)  attributable  to   Basic  earnings  (loss)  per  share   Diluted  earnings  (loss)  per  share   Net  cash  flow  provided  from  operating   activities $                               366.4 $                               197.7 $                                       179.7 $                               207.8 $                               302.6 $                               266.2 $                     315.9 $                           214.5 (a)    The  interim  financial  statements  for  the  three  months  ended  March  31,  2016,  were  recast  to  reflect  the  retrospective  impact  of  the  finalization  of  the  purchase  price   allocation    of    the  acquisition  of    Bald  Mountain    and    50%    of  Round  Mountain. The  Company’s  results  over  the  past  several  quarters  have  been  driven  primarily  by  fluctuations  in  the  gold  price,  input  costs  and   changes  in  gold  equivalent  ounces  sold.    Fluctuations  in  the  silver  price  have  also  affected  results.       During  the  fourth  quarter  of  2017,  revenue  decreased  to  $810.3  million  on  total  gold  equivalent  ounces  sold  of  634,762  compared   with   $902.8   million   on   sales   of   743,427   total   gold   equivalent   ounces   during   the   fourth   quarter   of   2016.     The   average   gold   price   realized  in  the  fourth  quarter  of  2017  was  $1,276  per  ounce  compared  with  $1,217  per  ounce  in  the  fourth  quarter  of  2016.     Production  cost  of  sales  decreased  to  $414.5  million  compared  with  $529.4  million  in  the  same  period  of  2016,  primarily  due  to  a   decrease  in  gold  equivalent  ounces  sold  and  lower  costs  realized  at  Fort  Knox.     Fluctuations  in  foreign  exchange  rates  have  also  affected  results.    Depreciation,  depletion  and  amortization  varied  between  each  of   the   above   quarters   largely   due   to   changes   in   gold   equivalent   ounces   sold   and   depreciable   asset   bases.     In   addition,   changes   in   mineral  reserves  during  each  of  these  years  affected  depreciation,  depletion  and  amortization  for  quarters  in  the  subsequent  year.   On  March  28,  2017,  the  Company  announced  that  it  entered  into  an  agreement  with  Goldcorp  to  sell  its  25%  interest  in  the  Cerro   Casale  project  and  its  100%  interest  in  the  Quebrada  Seca  exploration  project  in  Chile.  On  June  9,  2017,  the  Company  completed  the   sale   for   gross   cash   proceeds   of   $260.0   million   (which   included   $20.0   million   for   Quebrada   Seca).   In   connection   with   the   sale,   the   Company  recognized  a  gain  on  disposition  of  $12.7  million  during  the  three  months  ended  June  30,  2017.     On   May   18,   2017,   the   Company   entered   into   an   agreement   with   White   Gold   Corp.   to   sell   its   100%   interest   in   the   White   Gold   exploration  project  in  the  Yukon  Territory.  On  June  14,  2017,  the  Company  completed  the  sale  and  recognized  a  loss  on  disposition   of  $1.7  million  for  the  three  months  ended  June  30,  2017.     In  the  fourth  quarter  of  2017,  the  Company  recorded  a  net,  after-­‐tax,  impairment  reversal  of  $62.1  million  related  to  impairment   reversals  at  its  Tasiast  and  Fort  Knox  CGUs,  offset  by  an  impairment  charge  at  its  Paracatu  CGU.   During  the  third  quarter  of  2016,  the  Company  recorded  an  impairment  charge  of  $139.6  million  relating  to  its  Maricunga  CGU  as  a   result  of  the  suspension  of  mining  and  crushing  activities.  The  impairment  charge  included  $68.3  million  related  to  property,  plant   and  equipment  and  $71.3  million  related  to  inventory.     On  January  11,  2016,  Kinross  completed  the  acquisition  of  Bald  Mountain  and  the  remaining  50%  interest  in  Round  Mountain  from   Barrick  for  $610.0  million  in  cash,  subject  to  a  working  capital  adjustment.  In  April  2016,  the  Company  received  $22.0  million  in  cash   from  Barrick  in  connection  with  the  working  capital  adjustment,  which  reduced  the  final  purchase  price  to  $588.0  million.   Net  operating  cash  flows  increased  to  $366.4  million  in  the  fourth  quarter  of  2017,  compared  with  $302.6  million  in  the  same  period   of  2016,  primarily  due  to  the  increase  in  margins.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   8. DISCLOSURE  CONTROLS  AND  PROCEDURES  AND  INTERNAL  CONTROL  OVER  FINANCIAL  REPORTING   Pursuant   to   regulations   adopted   by   the   U.S.  Securities   and   Exchange   Commission,   under   the   Sarbanes-­‐Oxley   Act   of   2002   (the   “Sarbanes-­‐Oxley  Act”)  and  those  of  the  Canadian  Securities  Administrators,  Kinross'  management  evaluates  the  effectiveness  of  the   design   and   operation   of   the   Company's   disclosure   controls   and   procedures,   and   internal   control   over   financial   reporting.   This   evaluation  is  done  under  the  supervision  of,  and  with  the  participation  of,  the  Chief  Executive  Officer  and  the  Chief  Financial  Officer.     As  of  the  end  of  the  period  covered  by  this  MD&A  and  the  accompanying  financial  statements,  Kinross’  management  evaluated  the   effectiveness   of   its   disclosure   controls   and   procedures   and   internal   control   over   financial   reporting.     In   making   this   assessment,   management  used  the  criteria  specified  in  Internal  Control  -­‐  Integrated  Framework  (2013)  issued  by  the  Committee  of  Sponsoring   Organizations   of   the   Treadway   Commission.     Based   on   that   evaluation,   the   Chief   Executive   Officer   and   the   Chief   Financial   Officer   have  concluded  that  Kinross’  disclosure  controls  and  procedures,  and  internal  control  over  financial  reporting  were  effective  as  at   December  31,  2017.       Limitations  of  Controls  and  Procedures     Kinross’  management,  including  the  Chief  Executive  Officer  and  the  Chief  Financial  Officer,  believes  that  any  disclosure  controls  and   procedures  and  internal  control  over  financial  reporting,  no  matter  how  well  designed  and  operated,  can  have  inherent  limitations.   Therefore,  even  those  systems  determined  to  be  effective  can  provide  only  reasonable  assurance  that  the  objectives  of  the  control   system  are  met.   9. CRITICAL  ACCOUNTING  POLICIES,  ESTIMATES  AND  ACCOUNTING  CHANGES   Critical  Accounting  Policies  and  Estimates     Critical  accounting  policies  and  estimates  are  disclosed  in  Note  5  of  the  financial  statements.     Recent  Accounting  Pronouncements   Recent  accounting  pronouncements  issued  by  the  IASB  are  disclosed  in  Note  4  of  the  financial  statements.     10. RISK  ANALYSIS   The  business  of  Kinross  contains  significant  risk  due  to  the  nature  of  mining,  exploration,  and  development  activities.    Certain  risk   factors,  including  but  not  limited  to  those  listed  below,  are  similar  across  the  mining  industry  while  others  are  specific  to  Kinross.     The  risk  factors  below  may  include  details  of  how  Kinross  seeks  to  mitigate  these  risks  where  possible.    For  additional  discussion  of   risk  factors  please  refer  to  the  Company's  Annual  Information  Form  for  the  year  ended  December  31,  2016,  which  is  available  on  the   Company's   website www.kinross.com and   on www.sedar.com or   is   available   upon   request   from   the  Company,   and   to   the   Company’s  Annual  Information  Form  for  the  year  ended  December  31,  2017,  which  will  be  filed  on  SEDAR  on  or  about  March  31,   2018.     On  September  18,  2017,  the  Company  entered  into  an  agreement  with  Integra  to  sell  its  100%  interest  in  DeLamar.  On  November  3,   2017,  the  Company  completed  the  sale  and  recognized  a  gain  of  $44.2  million.   Gold  Price  and  Silver  Price     The   profitability   of   Kinross'   operations   is   significantly   affected   by   changes   in   the   market   price   of   gold   and   silver.     Gold   and   silver       prices  fluctuate  on  a  daily  basis  and  are  affected  by  numerous  factors  beyond  the  control  of  Kinross.    The  price  of  gold  and/or  silver   can   be   subject   to   volatile   price   movements   and   future   serious   price   declines   could   cause   continued   commercial   production   to   be   impractical.    Depending  on  the  prices  of  gold  and  silver,  cash  flow  from  mining  operations  may  not  be  sufficient  to  cover  costs  of   production  and  capital  expenditures.    If,  as  a  result  of  a  decline  in  gold  and/or  silver  prices,  revenues  from  metal  sales  were  to  fall   below   cash   operating   costs,   production   may   be   discontinued.     The   factors   that   may   affect   the   price   of   gold   and   silver   include   industry  factors  such  as:  industrial  and  jewelry  demand;  the  level  of  demand  for  the  metal  as  an  investment;  central  bank  lending,   sales  and  purchases  of  the  metal;  speculative  trading;  and  costs  of  and  levels  of  global  production  by  producers  of  the  metal.    Gold   and  silver  prices  may  also  be  affected  by  macroeconomic  factors,  including:  expectations  of  the  future  rate  of  inflation;  the  strength   of,  and  confidence  in,  the  U.S.  dollar,  the  currency  in  which  the  price  of  the  metal  is  generally  quoted,  and  other  currencies;  interest   rates;  and  global  or  regional  political  or  economic  uncertainties.     In   2017,   the   Company’s   average   realized   gold   price   increased   to   $1,260   per   ounce   from   $1,249   per   ounce   in   2016.     If   the   world   market  price  of  gold  and/or  silver  continued  to  drop  and  the  prices  realized  by  Kinross  on  gold  and/or  silver  sales  were  to  decrease   further  and  remain  at  such  a  level  for  any  substantial  period,  Kinross'  profitability  and  cash  flow  would  be  negatively  affected.    In   40 41 KINROSS ANNUAL REPORT MDA 41                                                       KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   such  circumstances,  Kinross  may  determine  that  it  is  not  economically  feasible  to  continue  commercial  production  at  some  or  all  of   its  operations  or  the  development  of  some  or  all  of  its  current  projects,  which  could  have  an  adverse  impact  on  Kinross'  financial   performance   and   results   of   operations,   possibly   material.     Kinross   may   curtail   or   suspend   some   or   all   of   its   exploration   activities,   with  the  result  that  depleted  mineral  reserves  are  not  replaced.    In  addition,  the  market  value  of  Kinross'  gold  and/or  silver  inventory   may  be  reduced  and  existing  mineral  reserves  and  resource  estimates  may  be  reduced  to  the  extent  that  ore  cannot  be  mined  and   processed  economically  at  the  prevailing  prices.    Furthermore,  certain  of  Kinross'  mineral  projects  include  copper  which  is  similarly   subject  to  price  volatility  based  on  factors  beyond  Kinross'  control.   payment  of  royalties,  net  profit  interest  or  similar  obligations,  could  adversely  affect  Kinross’  operations  or  substantially  increase  the   costs  associated  with  those  operations.    Kinross  is  unable  to  predict  what  new  legislation  or  revisions  may  be  proposed  that  might   affect  its  business  or  when  any  such  proposals,  if  enacted,  might  become  effective.   Certain   of   the   Company’s   operations   are   the   subject   of   ongoing   regulatory   review   and   evaluation   by   governmental   authorities.   These  may  result  in  additional  regulatory  actions  against  the  affected  operating  subsidiaries,  and  may  have  an  adverse  effect  on  the   Company’s  future  operations  and/or  financial  condition.    For  further  details  refer  to  Section  6  –Other  legal  matters.     Nature  of  Mineral  Exploration  and  Mining     Reclamation  Costs   The  exploration  and  development  of  mineral  deposits  involves  significant  financial  and  other  risks  over  an  extended  period  of  time   which  may  not  be  eliminated  even  with  careful  evaluation,  experience  and  knowledge.    While  discovery  of  gold-­‐bearing  geological   structures   may   result   in   substantial   rewards,   few   properties   explored   are   ultimately   developed   into   producing   mines.     Major   expenditures  are  required  to  establish  reserves  by  drilling  and  to  construct  mining  and  processing  facilities  at  a  site.    It  is  impossible   to  ensure  that  the  current  or  proposed  exploration  programs  on  properties  in  which  Kinross  has  an  interest  will  result  in  profitable   commercial  mining  operations.     The  operations  of  Kinross  are  subject  to  the  hazards  and  risks  normally  incidental  to  exploration,  development  and  production  of   gold  and  silver,  any  of  which  could  result  in  damage  to  life  or  property,  or  environmental  damage,  and  possible  legal  liability  for  such   damage.    The  activities  of  Kinross  may  be  subject  to  prolonged  disruptions  due  to  weather  conditions  depending  on  the  location  of   operations  in  which  it  has  interests.    Hazards,  such  as  unusual  or  unexpected  formations,  rock  bursts,  pressures,  cave-­‐ins,  flooding,   pit  wall  failures,  tailings  dam  failures  or  other  conditions,  may  be  encountered  in  the  drilling,  processing  and  removal  of  material.     While   Kinross   may   obtain   insurance   against   certain   risks,   potential   claims   could   exceed   policy   limits   or   could   be   excluded   from   coverage.     There   are   also   risks   against   which   Kinross   cannot   or   may   elect   not   to   insure.     The   potential   costs   which   could   be   associated  with  any  liabilities  not  covered  by  insurance  or  in  excess  of  insurance  coverage  or  compliance  with  applicable  laws  and   regulations   may   cause   substantial   delays   and   require   significant   capital   outlays,   adversely   affecting   the   future   earnings   and   competitive  position  of  Kinross  and,  potentially,  its  financial  viability.     Whether   a   mineral   deposit   will   be   commercially   viable   depends   on   a   number   of   factors,   some   of   which   include   the   particular   attributes  of  the  deposit,  such  as  its  size  and  grade,  costs  and  efficiency  of  the  recovery  methods  that  can  be  employed,  proximity  to   infrastructure,  financing  costs  and  governmental  regulations,  including  regulations  relating  to  prices,  taxes,  royalties,  infrastructure,   land  and  water  use,  importing  and  exporting  of  gold  and  environmental  protection.    The  effect  of  these  factors  cannot  be  accurately   predicted,  but  the  combination  of  these  factors  may  result  in  Kinross  not  receiving  an  adequate  return  on  its  invested  capital.     Kinross  mitigates  the  likelihood  and  potential  severity  of  these  mining  risks  in  its  day-­‐to-­‐day  operations  through  the  application  of   high  operating  standards.    In  addition,  Kinross  reviews  its  insurance  coverage  at  least  annually  to  ensure  that  appropriate  and  cost-­‐ effective  coverage  is  obtained.   Environmental  Impact  and  Related  Regulatory  Risk   Mining,  like  many  other  extractive  natural  resource  industries,  is  subject  to  potential  risks  and  liabilities  associated  with  the  effects   on   the   environment   resulting   from   mineral   exploration   and   production.     The   Company   may   be   held   responsible   for   the   costs   of   addressing   contamination   at,   or   arising   from,   current   or   former   activities.     Environmental   liability   may   result   from   activities   conducted  by  others  prior  to  the  ownership  of  a  property  by  Kinross.    In  addition,  Kinross  may  be  liable  to  third  parties  for  exposure   to   hazardous   materials   or   substances,   or   may   otherwise   be   involved   in   civil   litigation   related   to   environmental   claims.     The   costs   associated  with  such  responsibilities  and  liabilities  may  be  substantial.    The  payment  of  such  liabilities  would  reduce  funds  otherwise   available   and   could   have   a   material   adverse   effect   on   Kinross.     Should   Kinross   be   unable   to   fully   fund   the   cost   of   remedying   an   environmental   problem,   Kinross   might   be   required   to   suspend   operations   or   enter   into   interim   compliance   measures   pending   completion  of  the  required  remedy,  which  could  have  a  material  adverse  effect  on  the  operations  and  business  of  Kinross.   Kinross’   operations   and   exploration   activities   are   subject   to   various   laws   and   regulations   governing   the   protection   of   the   environment,  exploration,  development,  production,  imports/exports,  taxes,  labour  standards,  occupational  health,  waste  disposal,   toxic   substances,   mine   closure,   mine   safety,   and   other   matters.     The   legal   and   political   circumstances   outside   of   North   America   cause  these  risks  to  be  different  from,  and  in  many  cases,  greater  than,  comparable  risks  associated  with  operations  within  North   America.    New  laws  and  regulations,  amendments  to  existing  laws  and  regulations,  or  more  stringent  enforcement  of  existing  laws   and  regulations  could  have  a  material  adverse  impact  on  Kinross,  increase  costs,  cause  a  reduction  in  levels  of  production  and/or   delay  or  prevent  the  development  of  new  mining  properties.    Compliance  with  these  laws  and  regulations  is  part  of  the  business  and   requires  significant  expenditures.    Changes  in   laws  and  regulations,  including  those  pertaining  to   the  rights  of  leaseholders  or  the   42 KINROSS ANNUAL REPORT MDA 42 In  certain  jurisdictions  in  which  the  Company  has  operations,  the  Company  is  required  to  submit  a  reclamation  plan  for  its  applicable   operations   to   address   post-­‐operation   reclamation   obligations.     The   Company   may   incur   significant   costs   in   connection   with  these   reclamation  activities,  which  may  exceed  the  provisions  the  Company  has  made  in  respect  of  its  reclamation  obligations.    In  some   jurisdictions,  reclamation  bonds,  letters  of  credit  or  other  forms  of  financial  assurance  are  required  as  security  for  these  reclamation   obligations.     The   amount   and   nature   of   financial   assurance   are   dependent   upon   a   number   of   factors,   including   the   Company’s   financial   condition   and   reclamation   cost   estimates.     Kinross   may   be   required   to   replace   or   supplement   the   existing   financial   assurance,  or  source  new  financial  assurance  with  more  expensive  forms,  which  might  include  cash  deposits,  which  would  reduce  its   cash  available  for  operations  and  financing  activities.    There  can  be  no  assurance  that  Kinross  will  be  able  to  maintain  or  add  to  its   current   level   of   financial   assurance.     To   the   extent   that   Kinross   is   or   becomes   unable   to   post   and   maintain   sufficient   financial   assurance  for  reclamation  costs,  it  could  potentially  result  in  closure  of  one  or  more  of  the  Company’s  operations,  which  could  have   a  material  adverse  effect  on  the  financial  condition  of  the  Company.   Internal  Controls     Kinross   has   invested   resources   to   document   and   assess   its   system   of   internal   control   over   financial   reporting   and   undertakes   continuous   evaluation   of   such   internal   controls.     Internal   control   over   financial   reporting   are   procedures   designed   to   provide   reasonable  assurance  that  transactions  are  properly  authorized,  assets  are  safeguarded  against  unauthorized  or  improper  use,  and   transactions  are  properly  recorded  and  reported.    A  control  system,  no  matter  how  well  designed  and  operated,  can  provide  only   reasonable,  not  absolute,  safeguards  with  respect  to  the  reliability  of  financial  reporting  and  financial  statement  preparation.     Kinross   is   required   to   satisfy   the   requirement   of   Section   404   of   the   U.S.   Sarbanes-­‐Oxley   Act   of   2002   (“SOX”),   which   requires   an   annual  assessment  by  management  of  the  effectiveness  of  Kinross’  internal  control  over  financial  reporting  and  an  attestation  report   by  Kinross’  independent  auditors  addressing  the  operating  effectiveness  of  Kinross’  internal  control  over  financial  reporting.   If   Kinross   fails   to   maintain   the   adequacy   of   its   internal   control   over   financial   reporting,   as   such   standards   are   modified,   supplemented,  or  amended  from  time  to  time,  Kinross  may  not  be  able  to  ensure  that  it  can  conclude  on  an  ongoing  basis  that  it  has   effective   internal   control   over   financial   reporting   in   accordance   with   SOX.     Kinross’   failure   to   satisfy   SOX   requirements     on   an   ongoing,  timely  basis  could  result  in  the  loss  of  investor  confidence  in  the  reliability  of  its  financial  statements,  which  in  turn  could   harm  Kinross’  business  and  negatively  impact  the  trading  price  of  its  common  shares.    In  addition,  any  failure  to  implement  required   new  or  improved  controls,  or  difficulties  encountered  in  their  implementation,  could  harm  Kinross’  operating  results  or  cause  it  to   fail  to  meet  its  reporting  obligations.   Although  Kinross  is  committed  to  ensure  ongoing  compliance,  Kinross  cannot  be  certain  that  it  will  be  successful  in  complying  with   SOX.   Indebtedness  and  an  Inability  to  Satisfy  Repayment  Obligations   Although  Kinross  has  been  successful  in  repaying  debt  historically,  there  can  be  no  assurance  that  it  can  continue  to  do  so.    Kinross’   level  of  indebtedness  could  have  important  and  potentially  adverse  consequences  for  its  operations  and  the  value  of  its  common   shares   including:   (a)   limiting   Kinross’   ability   to   borrow   additional   amounts   for   working   capital,   capital   expenditures,   debt   service   requirements,   execution   of   Kinross’   growth   strategy   or   other   purposes;   (b)   limiting   Kinross’   ability   to   use   operating   cash   flow   in   other  areas  because  of  its  obligations  to  service  debt;  (c)  increasing  Kinross’  vulnerability  to  general  adverse  economic  and  industry   conditions,   including   increases   in   interest   rates;   (d)   limiting   Kinross’   ability   to   capitalize   on   business   opportunities   and  to   react   to   competitive   pressures   and   adverse   changes   in   government   regulation;   and   (e)   limiting   Kinross’   ability   or   increasing   the   costs   to   refinance  indebtedness.     Kinross   expects   to   obtain   the   funds   to   pay   its   expenses   and   to   pay   principal   and   interest   on   its   debt   by   utilizing   cash   flow   from   operations.     Kinross’   ability   to   meet   these   payment   obligations   will   depend   on   its   future   financial   performance,   which   will   be   43                                       KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   such  circumstances,  Kinross  may  determine  that  it  is  not  economically  feasible  to  continue  commercial  production  at  some  or  all  of   its  operations  or  the  development  of  some  or  all  of  its  current  projects,  which  could  have  an  adverse  impact  on  Kinross'  financial   performance   and   results   of   operations,   possibly   material.     Kinross   may   curtail   or   suspend   some   or   all   of   its   exploration   activities,   with  the  result  that  depleted  mineral  reserves  are  not  replaced.    In  addition,  the  market  value  of  Kinross'  gold  and/or  silver  inventory   may  be  reduced  and  existing  mineral  reserves  and  resource  estimates  may  be  reduced  to  the  extent  that  ore  cannot  be  mined  and   processed  economically  at  the  prevailing  prices.    Furthermore,  certain  of  Kinross'  mineral  projects  include  copper  which  is  similarly   subject  to  price  volatility  based  on  factors  beyond  Kinross'  control.   payment  of  royalties,  net  profit  interest  or  similar  obligations,  could  adversely  affect  Kinross’  operations  or  substantially  increase  the   costs  associated  with  those  operations.    Kinross  is  unable  to  predict  what  new  legislation  or  revisions  may  be  proposed  that  might   affect  its  business  or  when  any  such  proposals,  if  enacted,  might  become  effective.   Certain   of   the   Company’s   operations   are   the   subject   of   ongoing   regulatory   review   and   evaluation   by   governmental   authorities.   These  may  result  in  additional  regulatory  actions  against  the  affected  operating  subsidiaries,  and  may  have  an  adverse  effect  on  the   Company’s  future  operations  and/or  financial  condition.    For  further  details  refer  to  Section  6  –Other  legal  matters.     Nature  of  Mineral  Exploration  and  Mining     Reclamation  Costs   The  exploration  and  development  of  mineral  deposits  involves  significant  financial  and  other  risks  over  an  extended  period  of  time   which  may  not  be  eliminated  even  with  careful  evaluation,  experience  and  knowledge.    While  discovery  of  gold-­‐bearing  geological   structures   may   result   in   substantial   rewards,   few   properties   explored   are   ultimately   developed   into   producing   mines.     Major   expenditures  are  required  to  establish  reserves  by  drilling  and  to  construct  mining  and  processing  facilities  at  a  site.    It  is  impossible   to  ensure  that  the  current  or  proposed  exploration  programs  on  properties  in  which  Kinross  has  an  interest  will  result  in  profitable   commercial  mining  operations.     The  operations  of  Kinross  are  subject  to  the  hazards  and  risks  normally  incidental  to  exploration,  development  and  production  of   gold  and  silver,  any  of  which  could  result  in  damage  to  life  or  property,  or  environmental  damage,  and  possible  legal  liability  for  such   damage.    The  activities  of  Kinross  may  be  subject  to  prolonged  disruptions  due  to  weather  conditions  depending  on  the  location  of   operations  in  which  it  has  interests.    Hazards,  such  as  unusual  or  unexpected  formations,  rock  bursts,  pressures,  cave-­‐ins,  flooding,   pit  wall  failures,  tailings  dam  failures  or  other  conditions,  may  be  encountered  in  the  drilling,  processing  and  removal  of  material.     While   Kinross   may   obtain   insurance   against   certain   risks,   potential   claims   could   exceed   policy   limits   or   could   be   excluded   from   coverage.     There   are   also   risks   against   which   Kinross   cannot   or   may   elect   not   to   insure.     The   potential   costs   which   could   be   associated  with  any  liabilities  not  covered  by  insurance  or  in  excess  of  insurance  coverage  or  compliance  with  applicable  laws  and   regulations   may   cause   substantial   delays   and   require   significant   capital   outlays,   adversely   affecting   the   future   earnings   and   competitive  position  of  Kinross  and,  potentially,  its  financial  viability.     Whether   a   mineral   deposit   will   be   commercially   viable   depends   on   a   number   of   factors,   some   of   which   include   the   particular   attributes  of  the  deposit,  such  as  its  size  and  grade,  costs  and  efficiency  of  the  recovery  methods  that  can  be  employed,  proximity  to   infrastructure,  financing  costs  and  governmental  regulations,  including  regulations  relating  to  prices,  taxes,  royalties,  infrastructure,   land  and  water  use,  importing  and  exporting  of  gold  and  environmental  protection.    The  effect  of  these  factors  cannot  be  accurately   predicted,  but  the  combination  of  these  factors  may  result  in  Kinross  not  receiving  an  adequate  return  on  its  invested  capital.     Kinross  mitigates  the  likelihood  and  potential  severity  of  these  mining  risks  in  its  day-­‐to-­‐day  operations  through  the  application  of   high  operating  standards.    In  addition,  Kinross  reviews  its  insurance  coverage  at  least  annually  to  ensure  that  appropriate  and  cost-­‐ effective  coverage  is  obtained.   Environmental  Impact  and  Related  Regulatory  Risk   Mining,  like  many  other  extractive  natural  resource  industries,  is  subject  to  potential  risks  and  liabilities  associated  with  the  effects   on   the   environment   resulting   from   mineral   exploration   and   production.     The   Company   may   be   held   responsible   for   the   costs   of   addressing   contamination   at,   or   arising   from,   current   or   former   activities.     Environmental   liability   may   result   from   activities   conducted  by  others  prior  to  the  ownership  of  a  property  by  Kinross.    In  addition,  Kinross  may  be  liable  to  third  parties  for  exposure   to   hazardous   materials   or   substances,   or   may   otherwise   be   involved   in   civil   litigation   related   to   environmental   claims.     The   costs   associated  with  such  responsibilities  and  liabilities  may  be  substantial.    The  payment  of  such  liabilities  would  reduce  funds  otherwise   available   and   could   have   a   material   adverse   effect   on   Kinross.     Should   Kinross   be   unable   to   fully   fund   the   cost   of   remedying   an   environmental   problem,   Kinross   might   be   required   to   suspend   operations   or   enter   into   interim   compliance   measures   pending   completion  of  the  required  remedy,  which  could  have  a  material  adverse  effect  on  the  operations  and  business  of  Kinross.   Kinross’   operations   and   exploration   activities   are   subject   to   various   laws   and   regulations   governing   the   protection   of   the   environment,  exploration,  development,  production,  imports/exports,  taxes,  labour  standards,  occupational  health,  waste  disposal,   toxic   substances,   mine   closure,   mine   safety,   and   other   matters.     The   legal   and   political   circumstances   outside   of   North   America   cause  these  risks  to  be  different  from,  and  in  many  cases,  greater  than,  comparable  risks  associated  with  operations  within  North   America.    New  laws  and  regulations,  amendments  to  existing  laws  and  regulations,  or  more  stringent  enforcement  of  existing  laws   and  regulations  could  have  a  material  adverse  impact  on  Kinross,  increase  costs,  cause  a  reduction  in  levels  of  production  and/or   delay  or  prevent  the  development  of  new  mining  properties.    Compliance  with  these  laws  and  regulations  is  part  of  the  business  and   requires  significant  expenditures.    Changes  in   laws  and  regulations,  including  those  pertaining  to   the  rights  of  leaseholders  or  the   42 In  certain  jurisdictions  in  which  the  Company  has  operations,  the  Company  is  required  to  submit  a  reclamation  plan  for  its  applicable   operations   to   address   post-­‐operation   reclamation   obligations.     The   Company   may   incur   significant   costs   in   connection   with  these   reclamation  activities,  which  may  exceed  the  provisions  the  Company  has  made  in  respect  of  its  reclamation  obligations.    In  some   jurisdictions,  reclamation  bonds,  letters  of  credit  or  other  forms  of  financial  assurance  are  required  as  security  for  these  reclamation   obligations.     The   amount   and   nature   of   financial   assurance   are   dependent   upon   a   number   of   factors,   including   the   Company’s   financial   condition   and   reclamation   cost   estimates.     Kinross   may   be   required   to   replace   or   supplement   the   existing   financial   assurance,  or  source  new  financial  assurance  with  more  expensive  forms,  which  might  include  cash  deposits,  which  would  reduce  its   cash  available  for  operations  and  financing  activities.    There  can  be  no  assurance  that  Kinross  will  be  able  to  maintain  or  add  to  its   current   level   of   financial   assurance.     To   the   extent   that   Kinross   is   or   becomes   unable   to   post   and   maintain   sufficient   financial   assurance  for  reclamation  costs,  it  could  potentially  result  in  closure  of  one  or  more  of  the  Company’s  operations,  which  could  have   a  material  adverse  effect  on  the  financial  condition  of  the  Company.   Internal  Controls     Kinross   has   invested   resources   to   document   and   assess   its   system   of   internal   control   over   financial   reporting   and   undertakes   continuous   evaluation   of   such   internal   controls.     Internal   control   over   financial   reporting   are   procedures   designed   to   provide   reasonable  assurance  that  transactions  are  properly  authorized,  assets  are  safeguarded  against  unauthorized  or  improper  use,  and   transactions  are  properly  recorded  and  reported.    A  control  system,  no  matter  how  well  designed  and  operated,  can  provide  only   reasonable,  not  absolute,  safeguards  with  respect  to  the  reliability  of  financial  reporting  and  financial  statement  preparation.     Kinross   is   required   to   satisfy   the   requirement   of   Section   404   of   the   U.S.   Sarbanes-­‐Oxley   Act   of   2002   (“SOX”),   which   requires   an   annual  assessment  by  management  of  the  effectiveness  of  Kinross’  internal  control  over  financial  reporting  and  an  attestation  report   by  Kinross’  independent  auditors  addressing  the  operating  effectiveness  of  Kinross’  internal  control  over  financial  reporting.   If   Kinross   fails   to   maintain   the   adequacy   of   its   internal   control   over   financial   reporting,   as   such   standards   are   modified,   supplemented,  or  amended  from  time  to  time,  Kinross  may  not  be  able  to  ensure  that  it  can  conclude  on  an  ongoing  basis  that  it  has   effective   internal   control   over   financial   reporting   in   accordance   with   SOX.     Kinross’   failure   to   satisfy   SOX   requirements     on   an   ongoing,  timely  basis  could  result  in  the  loss  of  investor  confidence  in  the  reliability  of  its  financial  statements,  which  in  turn  could   harm  Kinross’  business  and  negatively  impact  the  trading  price  of  its  common  shares.    In  addition,  any  failure  to  implement  required   new  or  improved  controls,  or  difficulties  encountered  in  their  implementation,  could  harm  Kinross’  operating  results  or  cause  it  to   fail  to  meet  its  reporting  obligations.   Although  Kinross  is  committed  to  ensure  ongoing  compliance,  Kinross  cannot  be  certain  that  it  will  be  successful  in  complying  with   SOX.   Indebtedness  and  an  Inability  to  Satisfy  Repayment  Obligations   Although  Kinross  has  been  successful  in  repaying  debt  historically,  there  can  be  no  assurance  that  it  can  continue  to  do  so.    Kinross’   level  of  indebtedness  could  have  important  and  potentially  adverse  consequences  for  its  operations  and  the  value  of  its  common   shares   including:   (a)   limiting   Kinross’   ability   to   borrow   additional   amounts   for   working   capital,   capital   expenditures,   debt   service   requirements,   execution   of   Kinross’   growth   strategy   or   other   purposes;   (b)   limiting   Kinross’   ability   to   use   operating   cash   flow   in   other  areas  because  of  its  obligations  to  service  debt;  (c)  increasing  Kinross’  vulnerability  to  general  adverse  economic  and  industry   conditions,   including   increases   in   interest   rates;   (d)   limiting   Kinross’   ability   to   capitalize   on   business   opportunities   and  to   react   to   competitive   pressures   and   adverse   changes   in   government   regulation;   and   (e)   limiting   Kinross’   ability   or   increasing   the   costs   to   refinance  indebtedness.     Kinross   expects   to   obtain   the   funds   to   pay   its   expenses   and   to   pay   principal   and   interest   on   its   debt   by   utilizing   cash   flow   from   operations.     Kinross’   ability   to   meet   these   payment   obligations   will   depend   on   its   future   financial   performance,   which   will   be   43 KINROSS ANNUAL REPORT MDA 43                                       KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   affected  by  financial,  business,  economic,  legal  and  other  factors.    Kinross  will  not  be  able  to  control  many  of  these  factors,  such  as   economic  conditions  in  the  markets  in  which  it  operates.    Kinross  cannot  be  certain  that  its  future  cash  flow  from  operations  will  be   sufficient  to  allow  it  to  pay  principal  and  interest  on  Kinross’  debt  and  meet  its  other  obligations.    If  cash  flow  from  operations  is   insufficient  or  if  there  is  a  contravention  of  its  debt  covenant(s),  Kinross  may  be  required  to  refinance  all  or  part  of  its  existing  debt,   sell  assets,  borrow  more  money  or  issue  additional  equity.    There  can  be  no  assurance  that  Kinross  will  be  able  to  refinance  all  or   part  of  its  existing  debt  on  terms  that  are  commercially  reasonable.   Mineral  Reserve  and  Mineral  Resource  Estimates   Mineral  reserve  and  mineral  resource  figures  are  estimates,  and  no  assurance  can  be  given  that  the  anticipated  tonnages  and  grades   will  be  achieved  or  that  the  indicated  level  of  recovery  will  be  realized.    Market  fluctuations  in  metal  prices  may  render  the  mining  of   mineral   reserves   and   mineral   resources   uneconomical   and   require   Kinross   to   take   a   write-­‐down   of   an   asset   or   to   discontinue   development  or  production.    Moreover,  short-­‐term  operating  factors  relating  to  the  mineral  reserves,  such  as  the  need  for  orderly   development  of  the  ore  body  or  the  processing  of  new  or  different  ore  grades,  may  cause  a  mining  operation  to  be  unprofitable  in   any  particular  accounting  period.     Proven  and  probable  mineral  reserves  at  Kinross'  mines  and  development  projects  were  estimated  as  of  December  31,  2017,  based   upon  a  gold  price  of  $1,200  per  ounce  of  gold.     Prolonged  declines  in  the  market  price  of  gold  below  this  level  may  render  mineral  reserves  containing  relatively  lower  grades  of   gold  mineralization  uneconomic  to  exploit  and  could  materially  reduce  Kinross'  mineral  reserve  estimates.    Should  such  reductions   occur,  material  write-­‐downs  of  Kinross'  investments  in  mining  properties  or  the  discontinuation  of  development  or  production  might   be  required,  and  there  could  be  material  delays  in  the  development  of  new  projects  and  reduced  income  and  cash  flow.     Mineral  resources  that  are  not  mineral  reserves  do  not  have  demonstrated  economic  viability.  Due  to  the  uncertainty  of  measured,   indicated  or  inferred  mineral  resources,  these  mineral  resources  may  never  be  upgraded  to  proven  and  probable  mineral  reserves.   Measured,   indicated   and   inferred   mineral   resources   are   not   recognized   by   the   U.S.   Securities   and   Exchange   Commission   and   U.S.   investors  are  cautioned  not  to  assume  that  any  part  of  mineral  deposits  in  these  categories  will  ever  be  converted  into  reserves  or   recovered.   There  are  numerous  uncertainties  inherent  in  estimating  proven  and  probable  mineral  reserves.    The  estimates  in  this  document  are   based  on  various  assumptions  relating  to  metal  prices  and  exchange  rates  during  the  expected  life  of  production  and  the  results  of   additional   planned   development   work.     Actual   future   production   rates   and   amounts,   revenues,   taxes,   operating   expenses,   environmental  and  regulatory  compliance  expenditures,  development  expenditures  and  recovery  rates  may  vary  substantially  from   those  assumed  in  the  estimates.    Any  significant  change  in  these  assumptions,  including  changes  that  result  from  variances  between   projected  and  actual  results,  could  result  in  a  material  downward  or  upward  revision  of  current  estimates.   Development  Projects     The   Company’s   ability   to   increase   or   maintain   present   gold   and   silver   production   levels   is   dependent   in   part   on   the   successful   development   of   new   mines   and/or   expansion   of   existing   mining   operations.     Kinross   is   dependent   on   future   growth   from   development   projects.     Development   projects   rely   on   the   accuracy   of   predicted   factors   including:   capital   and   operating   costs;   metallurgical   recoveries;   mineral   reserve   estimates;   and   future   metal   prices.     Development   projects   are   also   subject   to   accurate   feasibility   studies,   the   acquisition   of   surface   or   land   rights   and   the   issuance   of   necessary   governmental   permits.     Unforeseen   circumstances,   including   those   related   to   the   amount   and   nature   of   the   mineralization   at   the   development   site,   technological   impediments  to  extraction  and  processing,  legal  requirements,  governmental  intervention,  infrastructure  limitations,  environmental   issues,   disputes   with   local   communities   or   other   events,   could   result   in   one   or   more   of   our   planned   developments   becoming   impractical   or   uneconomic.     Any   such   occurrence   could   have   an   adverse   impact   on   Kinross’   financial   condition   and   results   of   operations.     In   addition,   as   a   result   of   the   substantial   expenditures   involved   in   development   projects,   developments   are   at   significant   risk   of   material   cost   overruns   versus   budget.     The   capital   expenditures   and   time   required   to   develop   new   mines   are   considerable   and   changes   in   cost   or   construction   schedules   can   significantly   increase   both   the   time   and   capital   required   to   build   the   project.     The   project   development   schedules   are   also   dependent   on   obtaining   the   governmental   approvals   necessary   for   the   operation   of   a   project.    The  timeline  to  obtain  these  government  approvals  is  often  beyond  the  control  of  Kinross.    It  is  not  unusual  in  the  mining   industry  for  new  mining  operations  to  experience  unexpected  problems  during  the  start-­‐up  phase,  resulting  in  delays  and  requiring   more  capital  than  anticipated.   44 KINROSS ANNUAL REPORT MDA 44 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Production  and  Cost  Estimates   The  Company  prepares  estimates  of  future  production,  operating  costs  and  capital  costs  for  its  operations.    Despite  the  Company’s   best  efforts  to  budget  and  estimate  such  costs,  as  a  result  of  the  substantial  expenditures  involved  in  the  development  of  mineral   projects  and  the  fluctuation  and  increase  of  costs  over  time,  development  projects  may  be  prone  to  material  cost  overruns.    Kinross'   actual   production   and   costs   may   vary   from   estimates   for   a   variety   of   reasons,   including:   increased   competition   for   resources   and   development   inputs;   cost   inflation   affecting   the   mining   industry   in   general;   actual   ore   mined   varying   from   estimates   of   grade,   tonnage,   dilution   and   metallurgical   and   other   characteristics;   short   term   operating   factors   including   relating   to   the   ore   mineral   reserves,  such  as  the  need  for  sequential  development  of  ore  bodies  and  the  processing  of  new  or  different  ore  grades;  revisions  to   mine   plans;   difficulties   with   supply   chain   management,   including   the   implementation   and   management   of   enterprise   resource   planning  software;  risks  and  hazards  associated  with  development,  mining  and  processing;  natural  phenomena,  such  as  inclement   weather  conditions,  water  availability,  floods,  and  earthquakes;  and  unexpected  labour  shortages,  strikes  or  other  disruptions.    Costs   of   production   may   also   be   affected   by   a   variety   of   factors,   including:   ore   grade,   ore   hardness,   metallurgy,   changing   waste-­‐to-­‐ore   ratios,   labour   costs,   cost   of   services,   commodities   (such   as   power   and   fuel)   and   other   inputs,   general   inflationary   pressures   and   currency  exchange  rates.    Many  of  these  factors  are  beyond  Kinross’  control.    No  assurance  can  be  given  that  Kinross’  cost  estimates   will   be   achieved.     Failure   to   achieve   production   or   cost   estimates   or   material   increases   in   costs   could   have   an   adverse   impact   on   Kinross’  future  cash  flows,  profitability,  results  of  operations  and  financial  condition.       Shortages  and  Price  Volatility  of  Input  Commodities,  Services  and  Other  Inputs   The  Company  is  dependent  on  various  input  commodities  (such  as  diesel  fuel,  electricity,  natural  gas,  steel,  concrete  and  cyanide),   labour,   and   equipment   (including   parts)   to   conduct   its   mining   operations   and   development   projects.     A   shortage   of   such   input   commodities,  labour,  or  equipment  or  a  significant  increase  in  their  costs  could  have  a  material  adverse  effect  on  the  Company’s   ability  to  carry  out  its  operations  and  therefore  limit,  or  increase  the  cost  of,  production.    The  Company  is  also  dependent  on  access   to  and  supply  of  water  and  electricity  to  carry  out  its  mining  operations,  and  such  access  and  supply  may  not  be  readily  available,   especially   at   the   Company’s   operations   in   Chile,   Brazil   and   Ghana.     Market   prices   of   input   commodities   can   be   subject   to   volatile   price  movements  which  can  be  material,  occur  over  short  periods  of  time  and  are  affected  by  factors  that  are  beyond  the  Company’s   control.    An  increase  in  the  cost,  or  decrease  in  the  availability,  of  input  commodities,  labour,  or  equipment  may  affect  the  timely   conduct  and  cost  of  Kinross’  operations  and  development  projects.    If  the  costs  of  certain  input  commodities  consumed  or  otherwise   used  in  connection  with  Kinross’  operations  and  development  projects  were  to  increase  significantly,  and  remain  at  such  levels  for  a   substantial  period,  the  Company  may  determine  that  it  is  not  economically  feasible  to  continue  commercial  production  at  some  or   all  of  its  operations  or  the  development  of  some  or  all  of  its  current  projects,  which  could  have  an  adverse  impact  on  the  Company’s   financial  performance  and  results  of  operations.   Political  Developments  and  Uncertainty  regarding  the  Russian  Federation   Ongoing  political  tensions  and  uncertainties  with  respect  to  the  Russian  Federation  (including  as  a  result  of  the  Russian  Federation’s   foreign   policy   decisions,   actions   in   respect   of   Ukraine   and   allegations   of   cyberattacks   and   other   interference   with   the   2016   U.S.   presidential  elections)  have  resulted  in  the  imposition  of  sectoral  and  other  economic  sanctions,  and  increased  the  risk  that  the  U.S.   and  certain  other  governments  may  impose  further  economic,  or  other,  sanctions  or  penalties  on,  or  may  take  other  actions  against,   the   Russian   Federation   or   on   persons   and/or   companies   conducting   business   in   the   Russian   Federation   or   may   otherwise   act   in   support  of  Ukraine.  There  can  be  no  assurance  that  sanctions  or  other  penalties  will  not  be  imposed,  or  other  actions  will  not  be   taken,   by   the   Russian   Federation,   including   in   response   to   existing   or   threatened   sanctions   or   other   penalties   or   actions   by   the   United   States,   Canada   or   the   European   Union   and/or   other   governments   against   the   Russian   Federation   or   persons   and/or   companies   conducting   business   in   the   Russian   Federation.   The   imposition   of   such   economic   sanctions   or   other   penalties,   or   such   other  actions  by  the  Russian  Federation  and/or  other  governments,  could  have  a  material  adverse  effect  on  the  Company’s  assets   and  operations.   Uncertainty  in  Mauritania   Kinross  is  subject  to  political,  economic  and  security  risks  which,  should  they  materialize,  may  adversely  affect  the  Company’s  ability   to   operate   its   Tasiast   mine   in   Mauritania.   These   risks   include   but   are   not   limited   to   the   following:   (1)   the   potential   that   the   government  may  attempt  to  renegotiate  current  mining  conventions  or  to  revoke  existing  stability  provisions  in  those  conventions;   (2)  potential  political  instability;  (3)  the  security  situation  in  the  country  may  deteriorate;  (4)  a  lack  of  transparency  in  the  operation   of   the   government   and   development   of   new   laws;   (5)   the   potential   for   laws   and   regulations   to   be   inconsistently   applied;   (6)   the   conversion   of   exploration   licenses   to   exploitation   licenses,   including   the   pending   conversion   request   for   Tasiast   Sud;   and   (7)   a   number   of   public   policy   issues   material   to   the   economic   viability   of   the   current   operation   or   any   possible   expansion   may   not   be   positively  resolved.  These  issues  include,  but  are  not  limited  to,  a  process  and  timetable  for  payment  or  offset  of  VAT  refunds  owed   45                                   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   affected  by  financial,  business,  economic,  legal  and  other  factors.    Kinross  will  not  be  able  to  control  many  of  these  factors,  such  as   economic  conditions  in  the  markets  in  which  it  operates.    Kinross  cannot  be  certain  that  its  future  cash  flow  from  operations  will  be   sufficient  to  allow  it  to  pay  principal  and  interest  on  Kinross’  debt  and  meet  its  other  obligations.    If  cash  flow  from  operations  is   insufficient  or  if  there  is  a  contravention  of  its  debt  covenant(s),  Kinross  may  be  required  to  refinance  all  or  part  of  its  existing  debt,   sell  assets,  borrow  more  money  or  issue  additional  equity.    There  can  be  no  assurance  that  Kinross  will  be  able  to  refinance  all  or   part  of  its  existing  debt  on  terms  that  are  commercially  reasonable.   Mineral  Reserve  and  Mineral  Resource  Estimates   Mineral  reserve  and  mineral  resource  figures  are  estimates,  and  no  assurance  can  be  given  that  the  anticipated  tonnages  and  grades   will  be  achieved  or  that  the  indicated  level  of  recovery  will  be  realized.    Market  fluctuations  in  metal  prices  may  render  the  mining  of   mineral   reserves   and   mineral   resources   uneconomical   and   require   Kinross   to   take   a   write-­‐down   of   an   asset   or   to   discontinue   development  or  production.    Moreover,  short-­‐term  operating  factors  relating  to  the  mineral  reserves,  such  as  the  need  for  orderly   development  of  the  ore  body  or  the  processing  of  new  or  different  ore  grades,  may  cause  a  mining  operation  to  be  unprofitable  in   any  particular  accounting  period.     Proven  and  probable  mineral  reserves  at  Kinross'  mines  and  development  projects  were  estimated  as  of  December  31,  2017,  based   upon  a  gold  price  of  $1,200  per  ounce  of  gold.     Prolonged  declines  in  the  market  price  of  gold  below  this  level  may  render  mineral  reserves  containing  relatively  lower  grades  of   gold  mineralization  uneconomic  to  exploit  and  could  materially  reduce  Kinross'  mineral  reserve  estimates.    Should  such  reductions   occur,  material  write-­‐downs  of  Kinross'  investments  in  mining  properties  or  the  discontinuation  of  development  or  production  might   be  required,  and  there  could  be  material  delays  in  the  development  of  new  projects  and  reduced  income  and  cash  flow.     Mineral  resources  that  are  not  mineral  reserves  do  not  have  demonstrated  economic  viability.  Due  to  the  uncertainty  of  measured,   indicated  or  inferred  mineral  resources,  these  mineral  resources  may  never  be  upgraded  to  proven  and  probable  mineral  reserves.   Measured,   indicated   and   inferred   mineral   resources   are   not   recognized   by   the   U.S.   Securities   and   Exchange   Commission   and   U.S.   investors  are  cautioned  not  to  assume  that  any  part  of  mineral  deposits  in  these  categories  will  ever  be  converted  into  reserves  or   recovered.   There  are  numerous  uncertainties  inherent  in  estimating  proven  and  probable  mineral  reserves.    The  estimates  in  this  document  are   based  on  various  assumptions  relating  to  metal  prices  and  exchange  rates  during  the  expected  life  of  production  and  the  results  of   additional   planned   development   work.     Actual   future   production   rates   and   amounts,   revenues,   taxes,   operating   expenses,   environmental  and  regulatory  compliance  expenditures,  development  expenditures  and  recovery  rates  may  vary  substantially  from   those  assumed  in  the  estimates.    Any  significant  change  in  these  assumptions,  including  changes  that  result  from  variances  between   projected  and  actual  results,  could  result  in  a  material  downward  or  upward  revision  of  current  estimates.   Development  Projects     The   Company’s   ability   to   increase   or   maintain   present   gold   and   silver   production   levels   is   dependent   in   part   on   the   successful   development   of   new   mines   and/or   expansion   of   existing   mining   operations.     Kinross   is   dependent   on   future   growth   from   development   projects.     Development   projects   rely   on   the   accuracy   of   predicted   factors   including:   capital   and   operating   costs;   metallurgical   recoveries;   mineral   reserve   estimates;   and   future   metal   prices.     Development   projects   are   also   subject   to   accurate   feasibility   studies,   the   acquisition   of   surface   or   land   rights   and   the   issuance   of   necessary   governmental   permits.     Unforeseen   circumstances,   including   those   related   to   the   amount   and   nature   of   the   mineralization   at   the   development   site,   technological   impediments  to  extraction  and  processing,  legal  requirements,  governmental  intervention,  infrastructure  limitations,  environmental   issues,   disputes   with   local   communities   or   other   events,   could   result   in   one   or   more   of   our   planned   developments   becoming   impractical   or   uneconomic.     Any   such   occurrence   could   have   an   adverse   impact   on   Kinross’   financial   condition   and   results   of   operations.     In   addition,   as   a   result   of   the   substantial   expenditures   involved   in   development   projects,   developments   are   at   significant   risk   of   material   cost   overruns   versus   budget.     The   capital   expenditures   and   time   required   to   develop   new   mines   are   considerable   and   changes   in   cost   or   construction   schedules   can   significantly   increase   both   the   time   and   capital   required   to   build   the   project.     The   project   development   schedules   are   also   dependent   on   obtaining   the   governmental   approvals   necessary   for   the   operation   of   a   project.    The  timeline  to  obtain  these  government  approvals  is  often  beyond  the  control  of  Kinross.    It  is  not  unusual  in  the  mining   industry  for  new  mining  operations  to  experience  unexpected  problems  during  the  start-­‐up  phase,  resulting  in  delays  and  requiring   more  capital  than  anticipated.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Production  and  Cost  Estimates   The  Company  prepares  estimates  of  future  production,  operating  costs  and  capital  costs  for  its  operations.    Despite  the  Company’s   best  efforts  to  budget  and  estimate  such  costs,  as  a  result  of  the  substantial  expenditures  involved  in  the  development  of  mineral   projects  and  the  fluctuation  and  increase  of  costs  over  time,  development  projects  may  be  prone  to  material  cost  overruns.    Kinross'   actual   production   and   costs   may   vary   from   estimates   for   a   variety   of   reasons,   including:   increased   competition   for   resources   and   development   inputs;   cost   inflation   affecting   the   mining   industry   in   general;   actual   ore   mined   varying   from   estimates   of   grade,   tonnage,   dilution   and   metallurgical   and   other   characteristics;   short   term   operating   factors   including   relating   to   the   ore   mineral   reserves,  such  as  the  need  for  sequential  development  of  ore  bodies  and  the  processing  of  new  or  different  ore  grades;  revisions  to   mine   plans;   difficulties   with   supply   chain   management,   including   the   implementation   and   management   of   enterprise   resource   planning  software;  risks  and  hazards  associated  with  development,  mining  and  processing;  natural  phenomena,  such  as  inclement   weather  conditions,  water  availability,  floods,  and  earthquakes;  and  unexpected  labour  shortages,  strikes  or  other  disruptions.    Costs   of   production   may   also   be   affected   by   a   variety   of   factors,   including:   ore   grade,   ore   hardness,   metallurgy,   changing   waste-­‐to-­‐ore   ratios,   labour   costs,   cost   of   services,   commodities   (such   as   power   and   fuel)   and   other   inputs,   general   inflationary   pressures   and   currency  exchange  rates.    Many  of  these  factors  are  beyond  Kinross’  control.    No  assurance  can  be  given  that  Kinross’  cost  estimates   will   be   achieved.     Failure   to   achieve   production   or   cost   estimates   or   material   increases   in   costs   could   have   an   adverse   impact   on   Kinross’  future  cash  flows,  profitability,  results  of  operations  and  financial  condition.       Shortages  and  Price  Volatility  of  Input  Commodities,  Services  and  Other  Inputs   The  Company  is  dependent  on  various  input  commodities  (such  as  diesel  fuel,  electricity,  natural  gas,  steel,  concrete  and  cyanide),   labour,   and   equipment   (including   parts)   to   conduct   its   mining   operations   and   development   projects.     A   shortage   of   such   input   commodities,  labour,  or  equipment  or  a  significant  increase  in  their  costs  could  have  a  material  adverse  effect  on  the  Company’s   ability  to  carry  out  its  operations  and  therefore  limit,  or  increase  the  cost  of,  production.    The  Company  is  also  dependent  on  access   to  and  supply  of  water  and  electricity  to  carry  out  its  mining  operations,  and  such  access  and  supply  may  not  be  readily  available,   especially   at   the   Company’s   operations   in   Chile,   Brazil   and   Ghana.     Market   prices   of   input   commodities   can   be   subject   to   volatile   price  movements  which  can  be  material,  occur  over  short  periods  of  time  and  are  affected  by  factors  that  are  beyond  the  Company’s   control.    An  increase  in  the  cost,  or  decrease  in  the  availability,  of  input  commodities,  labour,  or  equipment  may  affect  the  timely   conduct  and  cost  of  Kinross’  operations  and  development  projects.    If  the  costs  of  certain  input  commodities  consumed  or  otherwise   used  in  connection  with  Kinross’  operations  and  development  projects  were  to  increase  significantly,  and  remain  at  such  levels  for  a   substantial  period,  the  Company  may  determine  that  it  is  not  economically  feasible  to  continue  commercial  production  at  some  or   all  of  its  operations  or  the  development  of  some  or  all  of  its  current  projects,  which  could  have  an  adverse  impact  on  the  Company’s   financial  performance  and  results  of  operations.   Political  Developments  and  Uncertainty  regarding  the  Russian  Federation   Ongoing  political  tensions  and  uncertainties  with  respect  to  the  Russian  Federation  (including  as  a  result  of  the  Russian  Federation’s   foreign   policy   decisions,   actions   in   respect   of   Ukraine   and   allegations   of   cyberattacks   and   other   interference   with   the   2016   U.S.   presidential  elections)  have  resulted  in  the  imposition  of  sectoral  and  other  economic  sanctions,  and  increased  the  risk  that  the  U.S.   and  certain  other  governments  may  impose  further  economic,  or  other,  sanctions  or  penalties  on,  or  may  take  other  actions  against,   the   Russian   Federation   or   on   persons   and/or   companies   conducting   business   in   the   Russian   Federation   or   may   otherwise   act   in   support  of  Ukraine.  There  can  be  no  assurance  that  sanctions  or  other  penalties  will  not  be  imposed,  or  other  actions  will  not  be   taken,   by   the   Russian   Federation,   including   in   response   to   existing   or   threatened   sanctions   or   other   penalties   or   actions   by   the   United   States,   Canada   or   the   European   Union   and/or   other   governments   against   the   Russian   Federation   or   persons   and/or   companies   conducting   business   in   the   Russian   Federation.   The   imposition   of   such   economic   sanctions   or   other   penalties,   or   such   other  actions  by  the  Russian  Federation  and/or  other  governments,  could  have  a  material  adverse  effect  on  the  Company’s  assets   and  operations.   Uncertainty  in  Mauritania   Kinross  is  subject  to  political,  economic  and  security  risks  which,  should  they  materialize,  may  adversely  affect  the  Company’s  ability   to   operate   its   Tasiast   mine   in   Mauritania.   These   risks   include   but   are   not   limited   to   the   following:   (1)   the   potential   that   the   government  may  attempt  to  renegotiate  current  mining  conventions  or  to  revoke  existing  stability  provisions  in  those  conventions;   (2)  potential  political  instability;  (3)  the  security  situation  in  the  country  may  deteriorate;  (4)  a  lack  of  transparency  in  the  operation   of   the   government   and   development   of   new   laws;   (5)   the   potential   for   laws   and   regulations   to   be   inconsistently   applied;   (6)   the   conversion   of   exploration   licenses   to   exploitation   licenses,   including   the   pending   conversion   request   for   Tasiast   Sud;   and   (7)   a   number   of   public   policy   issues   material   to   the   economic   viability   of   the   current   operation   or   any   possible   expansion   may   not   be   positively  resolved.  These  issues  include,  but  are  not  limited  to,  a  process  and  timetable  for  payment  or  offset  of  VAT  refunds  owed   44 45 KINROSS ANNUAL REPORT MDA 45                                   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   by  the  government  to  the  Company,  the  long-­‐term  stability  in  the  Company’s  relationship  with  the  workers’  union,  the  application  of   a  clear,  comprehensive,  legally  certain  and  enforceable  VAT  exemption  for  the  mining  industry,  labor  force  management  and  flexible   labor  practices  and  the  timely  issuance  of  work  permits  for  the  non-­‐national  workforce.   U.S.  Environmental  Liability  Risk   In  the  United  States,  certain  mining  wastes  from  extraction  and  processing  of  ores  that  would  otherwise  be  considered  hazardous   waste  under  the  U.S.  Resource  Conservation  and  Recovery  Act  (“RCRA”)  and  state  law  equivalents,  are  currently  exempt  from  certain   U.S.   Environmental   Protection   Agency   (“EPA”)   regulations   governing   hazardous   waste.     If   mine   wastes   from   the   Company’s   U.S.   mining  operations,  including  those  at  the  Sunnyside  Mine  (see  Section  6  –  Other  legal  matters),  are  not  exempt,  and  are  treated  as   hazardous   waste   under   the   RCRA,   material   expenditures   could   be   required   for   waste   management   and/or   the   construction   of   additional  waste  disposal  facilities.  In  addition,  the  Company’s  activities  and  ownership  interests  potentially  expose  the  Company  to   liability  under  the  Comprehensive  Environmental  Response,  Compensation,  and  Liability  Act  (“CERCLA”)  and  its  state  law  equivalents.     Under  CERCLA  and  its  state  law  equivalents,  subject  to  certain  defenses,  any  present  or  past  owners  or  operators  of  a  facility,  and   any  parties  that  disposed  or  arranged  for  the  disposal  of  hazardous  substances  at  such  a  facility,  could  be  held  jointly  and  severally   liable  for  cleanup  costs  and  may  be  forced  to  undertake  remedial  cleanup  actions  or  to  pay  for  the  cleanup  efforts  in  response  to   unpermitted  releases  of  hazardous  substances.    Such  parties  may  also  be  liable  to  governmental  entities  for  the  cost  of  damages  to   natural   resources,   which   may   be   substantial.     Additional   regulations   or   requirements   may   also   be   imposed   upon   the   Company’s   operations,    tailings,    and    waste    disposal    areas    as    well    as    upon    mine    closure    under    federal    and    state  environmental  laws  and   regulations,  including,  without  limitation,  the  U.S.  Clean  Water  Act  (“CWA”)  and  state  law  equivalents.    Air  emissions  in  the  U.S.  are   subject  to  the  Clean  Air  Act  and  its  state  equivalents  as  well.    Additionally,    the    Company    is    subject    to    other  federal    and    state     environmental    laws,    and    potential    claims  existing  under  common  law,  relating  to  the  operation  and  closure  of  the  Company’s  U.S.   mine  sites.   Political,  Security,  Legal  and  Economic  Risk   The  Company  has  mining  and  exploration  operations  in  various  regions  of  the  world,  including  the  United  States,  Brazil,  Chile,  the   Russian   Federation,   Mauritania,   Ghana,   and   Canada   and   such   operations   are   exposed   to   various   levels   of   political,   security,   legal,   economic,  and  other  risks  and  uncertainties.    These  risks  and  uncertainties  vary  from  country  to  country  and  include,  but  are  not   limited   to:   terrorism;   hostage   taking;   crime,   including   organized   criminal   enterprise;   thefts   and   illegal   incursions   on   property   (including  as  occur  at  Paracatu  and  Tasiast)  which  illegal  incursions  could  result  in  serious  security  and  operational  issues,  including   the  endangerment  of  life  and  property;  extreme  fluctuations  in  currency  exchange  rates;  high  rates  of  inflation;  labour  unrest;  the   risks   of   civil   unrest;   expropriation   and   nationalization;   renegotiation   or   nullification   of   existing   concessions,   licenses,   permits   and   contracts;  illegal  mining  (including  at  Tasiast)  could  result  in  serious  environmental,  social,  political,  security  and  operational  issues,   including  the  endangerment  of  life  and  property;  adequacy,  response  and  training  of  local  law  enforcement;  changes  to  policies  and   regulations   impacting   the   mining   sector;   restrictions   on   foreign   exchange   and   repatriation;   and   changing   political   conditions,   currency   controls,   and   governmental   regulations   that   favour   or   require   the   awarding   of   contracts   to   local   contractors   or   require   foreign  contractors  to  employ  citizens  of,  or  purchase  supplies  from,  a  particular  jurisdiction.     Future  political  and  economic  conditions  in  these  countries  may  result  in  these  governments  adopting  different  policies  with  respect   to  foreign  investment,  and  development  and  ownership  of  mineral  resources.    Any  changes  in  such  policies  may  result  in  changes  in   laws   affecting   ownership   of   assets,   foreign   investment,   mining   exploration   and   development,   taxation   including   value   added   and   withholding   taxes,   royalties,   currency   exchange   rates,   gold   sales,   environmental   protection,   labour   relations,   price   controls,   repatriation  of  income,  and  return  of  capital,  which  may  affect  both  the  ability  of  Kinross  to  undertake  exploration  and  development   activities  in  respect  of  future  properties  in  the  manner  currently  contemplated,  as  well  as  its  ability  to  continue  to  explore,  develop,   and   operate   those   properties   to   which   it   has   rights   relating   to   exploration,   development,   and   operation.     Future   governments   in   these  countries  may  adopt  substantially  different  policies,  which  might  extend  to,  as  an  example,  expropriation  of  assets.     The  tax  regimes  in  these  countries  may  be  subject  to  differing  interpretations  and  are  subject  to  change  from  time  to  time.    Kinross'   interpretation  of  taxation  law  as  applied  to  its  transactions  and  activities  may  not  coincide  with  that  of  the  tax  authorities  in  a  given   country.    As  a  result,  transactions  may  be  challenged  by  tax  authorities  and  Kinross'  operations  may  be  assessed,  which  could  result   in  significant  additional  taxes,  penalties  and  interest.     The   Company   is   subject   to   the   considerations   and   risks   of   operating   in   the   Russian   Federation.     Certain   currency   conversion   risks   exist  in  the  Russian  economy.    Russian  legislation  currently  permits  the  conversion  of  rouble  revenues  into  foreign  currency.    Any   delay  or  other  difficulty  in  converting  roubles  into  a  foreign  currency  to  make  a  payment  or  delay  in  or  restriction  on  the  transfer  of   foreign   currency   could   limit   our   ability   to   meet   our   payment   and   debt   obligations,   which   could   result   in   the   loss   of   suppliers,   acceleration  of  debt  obligations,  etc.   46 KINROSS ANNUAL REPORT MDA 46 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Licenses  and  Permits     The  development  projects  and  operations  of  Kinross  require  licenses  and  permits  from  various  governmental  authorities.    However,   such  licenses  and  permits  are  subject  to  challenge  and  change  in  various  circumstances.   Applicable  governmental  authorities  may   revoke  or  refuse  to  issue,  amend  or  renew  necessary  permits.  The  loss  of  such  permits  may  hinder  Kinross’  ability  to  operate  and   could  have  a  material  effect  on  Kinross’  financial  performance  and  results  of  operations.  There  can  be  no  guarantee  that  Kinross  will   be   able   to   obtain   or   maintain   all   necessary   licenses   and   permits   that   may   be   required   to   explore   and   develop   its   properties,   commence  construction  of  or  operation  of  mining  facilities,  or  to  maintain  continued  operations  that  economically  justify  the  cost.   Kinross  endeavors  to  be  in  compliance  with  these  licenses  and  permits,  and  underlying  laws  and  regulations,  at  all  times.       Title  to  Properties  and  Community  Relations   The  validity  of  mining  rights,  including  mining  claims  which  constitute  most  of  Kinross'  property  holdings,  may,  in  certain  cases,  be   uncertain   and   subject   to   being   contested.     Kinross'   mining   rights,   claims   and   other   land   titles,   particularly   title   to   undeveloped   properties,  may  be  defective  and  open  to  being  challenged  by  governmental  authorities  and  local  communities.     Certain   of   Kinross’   properties   may   be   subject   to   the   rights   or   the   asserted   rights   of   various   community   stakeholders,   including   indigenous   people.     The   presence   of   community   stakeholders   may   also   impact   on   the   Company’s   ability   to   explore,   develop   or   operate  its  mining  properties.    In  certain  circumstances,  consultation  with  such  stakeholders  may  be  required  and  the  outcome  may   affect  the  Company’s  ability  to  explore,  develop  or  operate  its  mining  properties.   Competition     The  mineral  exploration  and  mining  business  is  competitive  in  all  of  its  phases.    In  the  search  for  and  the  acquisition  of  attractive   mineral  properties,  Kinross  competes  with  numerous  other  companies  and  individuals,  including  competitors  with  greater  financial,   technical  and  other  resources  than  Kinross.    The  ability  of  the  Company  to  operate  successfully  in  the  future  will  depend  not  only  on   its   ability   to   develop   its   present   properties,   but   also   on   its   ability   to   select   and   acquire   suitable   new   producing   properties   or   prospects  for  mineral  exploration.    Kinross  may  be  unable  to  compete  successfully  with  its  competitors  in  acquiring  such  properties   or  prospects  on  terms  it  considers  acceptable,  if  at  all.   Certain   of   the   operations   in   which   the   Company   has   an   interest   are   operated   through   joint   arrangements   with   other   mining   companies.     Any   failure   of   such   other   companies   to   meet   their   obligations   to   Kinross   or   to   third   parties   could   have   a   material   adverse   effect   on   the   joint   arrangement.     In   addition,   Kinross   may   be   unable   to   exert   control   over   strategic   decisions   made   in   To  determine  its  market  risk  sensitivities,  Kinross  uses  an  internally  generated  financial  forecast  model  that  is  sensitized  to,  among   other  things,  various  gold  prices,  currency  exchange  rates,  interest  rates  and  energy  prices.    The  variable  with  the  greatest  impact  is   the  gold  price,  and  Kinross  prepares  a  base  case  scenario  and  then  sensitizes  it  by  a  10%  increase  and  decrease  in  the  gold  price.    For   2017,   sensitivity   to   a  10%   change   in   the   gold   price   is   estimated   to   have   an   approximate   $280   million   impact   on   pre-­‐tax   earnings.     Kinross'   financial   forecast   covers   the   projected   life   of   its   mines.   In   each   year,   gold   is   produced   according   to   the   mine   plan.     Additionally,  for  2017,  sensitivity  to  a  10%  change  in  the  silver  price  is  estimated  to  have  an  approximate  $6  million  impact  on  pre-­‐ tax  earnings.    Costs  are  estimated  based  on  current  production  costs  plus  the  impact  of  any  major  changes  to  the  operation  during   Joint  Arrangements   respect  of  such  properties.   Disclosures  about  Market  Risks   its  life.   Interest  Rate  Fluctuations     Hedging  Risks     Fluctuations   in   interest   rates   can   affect   the   Company’s   results   of   operations   and   cash   flow.     The   Company’s   corporate   revolving   credit  and  term  loan  facilities  are  subject  to  variable  interest  rates.   The   Company’s   earnings   can   vary   significantly   with   fluctuations   in   the   market   price   of   gold   and   silver.     Kinross’   practice   is   not   to   hedge  metal  sales.    On  occasion,  however,  the  Company  may  assume  or  enter  into  forward  sales  contracts  or  similar  instruments  if   47                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   by  the  government  to  the  Company,  the  long-­‐term  stability  in  the  Company’s  relationship  with  the  workers’  union,  the  application  of   a  clear,  comprehensive,  legally  certain  and  enforceable  VAT  exemption  for  the  mining  industry,  labor  force  management  and  flexible   labor  practices  and  the  timely  issuance  of  work  permits  for  the  non-­‐national  workforce.   U.S.  Environmental  Liability  Risk   In  the  United  States,  certain  mining  wastes  from  extraction  and  processing  of  ores  that  would  otherwise  be  considered  hazardous   waste  under  the  U.S.  Resource  Conservation  and  Recovery  Act  (“RCRA”)  and  state  law  equivalents,  are  currently  exempt  from  certain   U.S.   Environmental   Protection   Agency   (“EPA”)   regulations   governing   hazardous   waste.     If   mine   wastes   from   the   Company’s   U.S.   mining  operations,  including  those  at  the  Sunnyside  Mine  (see  Section  6  –  Other  legal  matters),  are  not  exempt,  and  are  treated  as   hazardous   waste   under   the   RCRA,   material   expenditures   could   be   required   for   waste   management   and/or   the   construction   of   additional  waste  disposal  facilities.  In  addition,  the  Company’s  activities  and  ownership  interests  potentially  expose  the  Company  to   liability  under  the  Comprehensive  Environmental  Response,  Compensation,  and  Liability  Act  (“CERCLA”)  and  its  state  law  equivalents.     Under  CERCLA  and  its  state  law  equivalents,  subject  to  certain  defenses,  any  present  or  past  owners  or  operators  of  a  facility,  and   any  parties  that  disposed  or  arranged  for  the  disposal  of  hazardous  substances  at  such  a  facility,  could  be  held  jointly  and  severally   liable  for  cleanup  costs  and  may  be  forced  to  undertake  remedial  cleanup  actions  or  to  pay  for  the  cleanup  efforts  in  response  to   unpermitted  releases  of  hazardous  substances.    Such  parties  may  also  be  liable  to  governmental  entities  for  the  cost  of  damages  to   natural   resources,   which   may   be   substantial.     Additional   regulations   or   requirements   may   also   be   imposed   upon   the   Company’s   operations,    tailings,    and    waste    disposal    areas    as    well    as    upon    mine    closure    under    federal    and    state  environmental  laws  and   regulations,  including,  without  limitation,  the  U.S.  Clean  Water  Act  (“CWA”)  and  state  law  equivalents.    Air  emissions  in  the  U.S.  are   subject  to  the  Clean  Air  Act  and  its  state  equivalents  as  well.    Additionally,    the    Company    is    subject    to    other  federal    and    state     environmental    laws,    and    potential    claims  existing  under  common  law,  relating  to  the  operation  and  closure  of  the  Company’s  U.S.   mine  sites.   Political,  Security,  Legal  and  Economic  Risk   The  Company  has  mining  and  exploration  operations  in  various  regions  of  the  world,  including  the  United  States,  Brazil,  Chile,  the   Russian   Federation,   Mauritania,   Ghana,   and   Canada   and   such   operations   are   exposed   to   various   levels   of   political,   security,   legal,   economic,  and  other  risks  and  uncertainties.    These  risks  and  uncertainties  vary  from  country  to  country  and  include,  but  are  not   limited   to:   terrorism;   hostage   taking;   crime,   including   organized   criminal   enterprise;   thefts   and   illegal   incursions   on   property   (including  as  occur  at  Paracatu  and  Tasiast)  which  illegal  incursions  could  result  in  serious  security  and  operational  issues,  including   the  endangerment  of  life  and  property;  extreme  fluctuations  in  currency  exchange  rates;  high  rates  of  inflation;  labour  unrest;  the   risks   of   civil   unrest;   expropriation   and   nationalization;   renegotiation   or   nullification   of   existing   concessions,   licenses,   permits   and   contracts;  illegal  mining  (including  at  Tasiast)  could  result  in  serious  environmental,  social,  political,  security  and  operational  issues,   including  the  endangerment  of  life  and  property;  adequacy,  response  and  training  of  local  law  enforcement;  changes  to  policies  and   regulations   impacting   the   mining   sector;   restrictions   on   foreign   exchange   and   repatriation;   and   changing   political   conditions,   currency   controls,   and   governmental   regulations   that   favour   or   require   the   awarding   of   contracts   to   local   contractors   or   require   foreign  contractors  to  employ  citizens  of,  or  purchase  supplies  from,  a  particular  jurisdiction.     Future  political  and  economic  conditions  in  these  countries  may  result  in  these  governments  adopting  different  policies  with  respect   to  foreign  investment,  and  development  and  ownership  of  mineral  resources.    Any  changes  in  such  policies  may  result  in  changes  in   laws   affecting   ownership   of   assets,   foreign   investment,   mining   exploration   and   development,   taxation   including   value   added   and   withholding   taxes,   royalties,   currency   exchange   rates,   gold   sales,   environmental   protection,   labour   relations,   price   controls,   repatriation  of  income,  and  return  of  capital,  which  may  affect  both  the  ability  of  Kinross  to  undertake  exploration  and  development   activities  in  respect  of  future  properties  in  the  manner  currently  contemplated,  as  well  as  its  ability  to  continue  to  explore,  develop,   and   operate   those   properties   to   which   it   has   rights   relating   to   exploration,   development,   and   operation.     Future   governments   in   these  countries  may  adopt  substantially  different  policies,  which  might  extend  to,  as  an  example,  expropriation  of  assets.     The  tax  regimes  in  these  countries  may  be  subject  to  differing  interpretations  and  are  subject  to  change  from  time  to  time.    Kinross'   interpretation  of  taxation  law  as  applied  to  its  transactions  and  activities  may  not  coincide  with  that  of  the  tax  authorities  in  a  given   country.    As  a  result,  transactions  may  be  challenged  by  tax  authorities  and  Kinross'  operations  may  be  assessed,  which  could  result   in  significant  additional  taxes,  penalties  and  interest.     The   Company   is   subject   to   the   considerations   and   risks   of   operating   in   the   Russian   Federation.     Certain   currency   conversion   risks   exist  in  the  Russian  economy.    Russian  legislation  currently  permits  the  conversion  of  rouble  revenues  into  foreign  currency.    Any   delay  or  other  difficulty  in  converting  roubles  into  a  foreign  currency  to  make  a  payment  or  delay  in  or  restriction  on  the  transfer  of   foreign   currency   could   limit   our   ability   to   meet   our   payment   and   debt   obligations,   which   could   result   in   the   loss   of   suppliers,   acceleration  of  debt  obligations,  etc.   46 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Licenses  and  Permits     The  development  projects  and  operations  of  Kinross  require  licenses  and  permits  from  various  governmental  authorities.    However,   such  licenses  and  permits  are  subject  to  challenge  and  change  in  various  circumstances.   Applicable  governmental  authorities  may   revoke  or  refuse  to  issue,  amend  or  renew  necessary  permits.  The  loss  of  such  permits  may  hinder  Kinross’  ability  to  operate  and   could  have  a  material  effect  on  Kinross’  financial  performance  and  results  of  operations.  There  can  be  no  guarantee  that  Kinross  will   be   able   to   obtain   or   maintain   all   necessary   licenses   and   permits   that   may   be   required   to   explore   and   develop   its   properties,   commence  construction  of  or  operation  of  mining  facilities,  or  to  maintain  continued  operations  that  economically  justify  the  cost.   Kinross  endeavors  to  be  in  compliance  with  these  licenses  and  permits,  and  underlying  laws  and  regulations,  at  all  times.       Title  to  Properties  and  Community  Relations   The  validity  of  mining  rights,  including  mining  claims  which  constitute  most  of  Kinross'  property  holdings,  may,  in  certain  cases,  be   uncertain   and   subject   to   being   contested.     Kinross'   mining   rights,   claims   and   other   land   titles,   particularly   title   to   undeveloped   properties,  may  be  defective  and  open  to  being  challenged  by  governmental  authorities  and  local  communities.     Certain   of   Kinross’   properties   may   be   subject   to   the   rights   or   the   asserted   rights   of   various   community   stakeholders,   including   indigenous   people.     The   presence   of   community   stakeholders   may   also   impact   on   the   Company’s   ability   to   explore,   develop   or   operate  its  mining  properties.    In  certain  circumstances,  consultation  with  such  stakeholders  may  be  required  and  the  outcome  may   affect  the  Company’s  ability  to  explore,  develop  or  operate  its  mining  properties.   Competition     The  mineral  exploration  and  mining  business  is  competitive  in  all  of  its  phases.    In  the  search  for  and  the  acquisition  of  attractive   mineral  properties,  Kinross  competes  with  numerous  other  companies  and  individuals,  including  competitors  with  greater  financial,   technical  and  other  resources  than  Kinross.    The  ability  of  the  Company  to  operate  successfully  in  the  future  will  depend  not  only  on   its   ability   to   develop   its   present   properties,   but   also   on   its   ability   to   select   and   acquire   suitable   new   producing   properties   or   prospects  for  mineral  exploration.    Kinross  may  be  unable  to  compete  successfully  with  its  competitors  in  acquiring  such  properties   or  prospects  on  terms  it  considers  acceptable,  if  at  all.   Joint  Arrangements   Certain   of   the   operations   in   which   the   Company   has   an   interest   are   operated   through   joint   arrangements   with   other   mining   companies.     Any   failure   of   such   other   companies   to   meet   their   obligations   to   Kinross   or   to   third   parties   could   have   a   material   adverse   effect   on   the   joint   arrangement.     In   addition,   Kinross   may   be   unable   to   exert   control   over   strategic   decisions   made   in   respect  of  such  properties.   Disclosures  about  Market  Risks   To  determine  its  market  risk  sensitivities,  Kinross  uses  an  internally  generated  financial  forecast  model  that  is  sensitized  to,  among   other  things,  various  gold  prices,  currency  exchange  rates,  interest  rates  and  energy  prices.    The  variable  with  the  greatest  impact  is   the  gold  price,  and  Kinross  prepares  a  base  case  scenario  and  then  sensitizes  it  by  a  10%  increase  and  decrease  in  the  gold  price.    For   2017,   sensitivity   to   a  10%   change   in   the   gold   price   is   estimated   to   have   an   approximate   $280   million   impact   on   pre-­‐tax   earnings.     Kinross'   financial   forecast   covers   the   projected   life   of   its   mines.   In   each   year,   gold   is   produced   according   to   the   mine   plan.     Additionally,  for  2017,  sensitivity  to  a  10%  change  in  the  silver  price  is  estimated  to  have  an  approximate  $6  million  impact  on  pre-­‐ tax  earnings.    Costs  are  estimated  based  on  current  production  costs  plus  the  impact  of  any  major  changes  to  the  operation  during   its  life.   Interest  Rate  Fluctuations     Fluctuations   in   interest   rates   can   affect   the   Company’s   results   of   operations   and   cash   flow.     The   Company’s   corporate   revolving   credit  and  term  loan  facilities  are  subject  to  variable  interest  rates.   Hedging  Risks     The   Company’s   earnings   can   vary   significantly   with   fluctuations   in   the   market   price   of   gold   and   silver.     Kinross’   practice   is   not   to   hedge  metal  sales.    On  occasion,  however,  the  Company  may  assume  or  enter  into  forward  sales  contracts  or  similar  instruments  if   47 KINROSS ANNUAL REPORT MDA 47                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   hedges   are   acquired   in   a   business   acquisition,   if   hedges   are   required   under   project   financing   requirements,   or   when   deemed   advantageous   by   management.     As   at   December   31,   2017,   there   were   no   metal   derivative   financial   instruments   outstanding.     In   addition,  Kinross  is  not  subject  to  margin  requirements  on  any  of  its  hedging  lines.   Foreign  Currency  Exchange  Risk     Currency  fluctuations  may  affect  the  revenues  which  the  Company  will  realize  from  its  operations  since  gold  and  silver  are  sold  in   the  world  market  in  United  States  dollars.    The  costs  of  Kinross  are  incurred  principally  in  Canadian  dollars,  United  States   dollars,   Chilean   pesos,   Brazilian   reais,   Russian   roubles,   Mauritanian   ouguiya   and   Ghanaian   cedis.     The   appreciation   of   non-­‐U.S.   dollar   currencies  against  the  U.S.  dollar  increases  the  cost  of  gold  and  silver  production  in  U.S.  dollar  terms.    Kinross’  results  are  positively   affected  when  the  U.S.  dollar  strengthens  against  these  foreign  currencies  and  are  adversely  affected  when  the  U.S.  dollar  weakens   against   these   foreign   currencies.     Where   possible,   Kinross’   cash   and   cash   equivalents   balances   are   primarily   held   in   U.S.   dollars.     From  time  to  time,  Kinross  transacts  currency  hedging  to  reduce  the  risk  associated  with  currency  fluctuations.    While  the  Chilean   peso,  Brazilian  real,  and  Russian  rouble  are  currently  convertible  into  Canadian  and  United  States  dollars,  they  may  not  always  be   convertible   in   the   future.     The   Mauritanian   ouguiya   and   Ghanaian   cedis   are   convertible   into   Canadian   and   U.S.   dollars,   but   conversion  may  be  subject  to  regulatory  and/or  central  bank  approval.   The   sensitivity   of   the   Company’s   pre-­‐tax   earnings   to   changes   in   the   U.S.   dollar   is   disclosed   in   Note   11   of   the   Company’s   financial   statements  for  the  year  ended  December  31,  2017.   Litigation  Risk   Legal  proceedings  may  be  brought  against  Kinross,  for  example,  litigation  based  on  its  business  activities,  environmental  laws,  tax   matters,  volatility  in  its  stock  price  or  failure  to  comply  with  its  disclosure  obligations,  which  could  have  a  material  adverse  effect  on   Kinross’  financial  condition  or  prospects.  Regulatory  and  government  agencies  may  bring  legal  proceedings  in  connection  with  the   enforcement  of  applicable  laws  and  regulations,  and  as  a  result  Kinross  may  be  subject  to  expenses  of  investigations  and  defense,   fines  or  penalties  for  violations  if  proven,  and  potentially  cost  and  expense  to  remediate,  increased   operating  costs  or  changes  to   operations,   and   cessation   of   operations   if   ordered   to   do   so   or   required   in   order   to   resolve   such   proceedings.   In   the   event   of   a   dispute  arising  at  Kinross’  foreign  operations,  Kinross  may  be  subject  to  the  exclusive  jurisdiction  of  foreign  courts  or  may  not  be   successful  in  subjecting  foreign  persons  to  the  jurisdiction  of  courts  in  Canada.  Kinross’  inability  to  enforce  its  rights  could  have  an   adverse  effect  on  its  future  cash  flows,  earnings,  results  of  operations  and  financial  condition.   Counterparty  and  Liquidity  Risk     Credit  risk  relates  to  cash  and  cash  equivalents,  accounts  receivable,  and  derivative  contracts  and  arises  from  the  possibility  that  a   counterparty  to  an  instrument  fails  to  perform.    Counterparty  risk  is  the  risk  that  a  third  party  might  fail  to  fulfill  its  performance   obligations  under  the  terms  of  a  financial  instrument.    The  Company  is  subject  to  counterparty  risk  and  may  be  affected,  in  the  event   that   a   counterparty   becomes   insolvent.     To   manage   both   counterparty   and   credit   risk,   the   Company   proactively   manages   its   exposure   to   individual   counterparties.     The   Company   only   transacts   with   highly-­‐rated   counterparties.     A   limit   on   contingent   exposure   has   been   established   for   each   counterparty   based   on   the   counterparty's   credit   rating,   and   the   Company   monitors   the   financial  condition  of  each  counterparty.       As   at   December   31,   2017,   the   Company's   gross   credit   exposure,   including   cash   and   cash   equivalents,   was   $1,358.7   million   and   at   December  31,  2016,  the  gross  credit  exposure,  including  cash  and  cash  equivalents,  was  $1,075.2  million.     Liquidity   risk   is   the   risk   that   the   Company   may   not   have   sufficient   cash   resources   available   to   meet   its   payment   obligations.     To   manage  liquidity  risk,  the  Company  maintains  cash  positions  and  has  financing  in  place  that  the  Company  expects  will  be  sufficient  to   meet  its  operating  and  capital  expenditure  requirements.    Potential  sources  for  liquidity  could  include,  but  are  not  limited  to:  the   Company's   current   cash   position,   existing   credit   facilities,   future   operating   cash   flow,   and   potential   private   and   public   financing.   Additionally,   the   Company   reviews   its   short-­‐term   operational   forecasts   regularly   and   long-­‐term   budgets   to   determine   its   cash   requirements.   Credit  Ratings   The   Company’s   ability   to   access   debt   markets   and   the   related   cost   of   debt   financing   is   dependent   upon   its   credit   ratings.     The   Company  has  a  BBB-­‐  rating  from  Fitch  Ratings,  a  Ba1  rating  from  Moody’s  and  a  BB+  rating  from  Standard    &  Poor’s.  There  is  no   assurance  that  these  credit  ratings  will  remain  in  effect  for  any  given  period  of  time  or  that  any  such  ratings  will  not  be  revised  or   withdrawn  entirely  by  a  rating  agency.  Real  or  anticipated  changes  in  credit  ratings  can  affect  the  price  of  the  Company’s  existing   debt  as  well  as  the  Company’s  ability  to  access  the  capital  markets  and  the  cost  of  such  debt  financing.   Potential  for  Incurring  Unexpected  Costs  or  Liabilities  as  a  Result  of  Acquisitions     Although  the  Company  conducts  investigations  in  connection  with  acquisitions,  risks  remain  regarding  any  undisclosed  or  unknown   liabilities   associated   with   any   such   acquisitions,   and   the   Company   may   discover   that   it   has   acquired   substantial   undisclosed   liabilities.     The   Company   may   have   little   recourse   against   the   seller   if   any   of   the   representations   or   warranties   provided   in   connection  with  an  acquisition  proves  to  be  inaccurate.    Such  liabilities  could  have  an  adverse  impact  on  the  Company's  business,   financial  condition,  results  of  operations  and  cash  flows.   Global  Financial  Condition     The   volatility   and   challenges   that   economies   continue   to   experience   around   the   world   continues   to   affect   the   profitability   and   liquidity   of   businesses   in   many   industries,   which   in   turn   has   resulted   in   the   following   conditions   that   may   have   an   effect   on   the   profitability  and  cash  flows  of  the  Company:     • • • • Volatility  in  commodity  prices  and  foreign  exchange  rates;     Tightening  of  credit  markets;     Counterparty  risk;  and     Volatility  in  the  prices  of  publicly  traded  entities.     The  volatility  in  commodity  prices  and  foreign  exchange  rates  directly  impact  the  Company’s  revenues,  earnings  and  cash  flows,  as   noted  above  in  the  sections  titled  “Gold  Price  and  Silver  Price”  and  “Foreign  Currency  Exchange  Risk”.     Although  the  tighter  credit  markets  have  restricted  the  ability  of  certain  companies  to  access  capital,  to  date  this  has  not  affected   the  Company's  liquidity.       The  Company  extended  the  maturity  date  of  its  revolving  credit  facility  by  one  year  to  August  2022.    As  at  December  31,  2017,  the   Company  had  $1,563.8  million  available  under  its  credit  facility  arrangements.    However,  continued  tightening  of  credit  markets  may   affect  the  ability  of  the  Company  to  obtain  equity  or  debt  financing  in  the  future  on  terms  favourable  to  the  Company.   The   Company   has   not   experienced   any   difficulties   to   date   relating   to   the   counterparties   it   transacts   with.     The   counterparties   continue  to  be  highly  rated,  and  as  noted  above,  the  Company  has  employed  measures  to  reduce  the  impact  of  counterparty  risk.     Continued  volatility  in  equity  markets  may  affect  the  value  of  publicly  listed  companies  in  Kinross'  equity  portfolio.    Should  declines   in  the  equity  values  continue  and  are  deemed  to  be  other  than  temporary,  impairment  losses  may  result.   Market  Price  Risk     Kinross’  common  shares  are  listed  on  the  Toronto  Stock  Exchange  (“TSX”)  and  the  New  York  Stock  Exchange  (“NYSE”).    The  price  of   Kinross’  common  shares  is  likely  to  be  significantly  affected  by  short-­‐term  changes  in  the  gold  price  or  in  its  financial  condition  or   results  of  operations  as  reflected  in  its  quarterly  earnings  reports.    Other  factors  unrelated  to  the  performance  of  Kinross  that  may   have   an   effect   on   the   price   of   the   Kinross   common   shares   include   the   following:   a   reduction   in   analytical   coverage   of   Kinross   by   investment   banks   with   research   capabilities;   increased   political   risk   in   countries   where   the   Company   operates;   a   drop   in   trading   volume  and  general  market  interest  in  the  securities  of  Kinross  may  adversely  affect  an  investor’s  ability  to  liquidate  an  investment   and  consequently  an  investor’s  interest  in  acquiring  a  significant  stake  in  Kinross;  a  failure  of  Kinross  to  meet  the  reporting  and  other   obligations  under  Canadian  and  U.S.  securities  laws  or  imposed  by  the  exchanges  could  result  in  a  delisting  of  the  Kinross  common   shares;  and  a  substantial  decline  in  the  price  of  the  Kinross  common  shares  that  persists  for  a  significant  period  of  time  could  cause   the  Kinross  common  shares  to  be  delisted  from  the  TSX  or  NYSE  further  reducing  market  liquidity.   As  a  result  of  any  of  these  factors,  the  market  price  of  Kinross’  common  shares  at  any  given  point  in  time  may  not  accurately  reflect   Kinross’   long-­‐term   value.     Securities   class   action   litigation   has   been   commenced   against   companies,   including   Kinross,   following   periods  of  volatility  or  significant  decline  in  the  market  price  of  their  securities.    Securities  litigation  could  result  in  substantial  costs   and  damages  and  divert  management’s  attention  and  resources.  Any   decision  resulting  from  any  such  litigation  that  is  adverse  to   the  Company  could  have  a  negative  impact  on  the  Company’s  financial  position.   48 KINROSS ANNUAL REPORT MDA 48 49                                                 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   hedges   are   acquired   in   a   business   acquisition,   if   hedges   are   required   under   project   financing   requirements,   or   when   deemed   advantageous   by   management.     As   at   December   31,   2017,   there   were   no   metal   derivative   financial   instruments   outstanding.     In   withdrawn  entirely  by  a  rating  agency.  Real  or  anticipated  changes  in  credit  ratings  can  affect  the  price  of  the  Company’s  existing   debt  as  well  as  the  Company’s  ability  to  access  the  capital  markets  and  the  cost  of  such  debt  financing.   addition,  Kinross  is  not  subject  to  margin  requirements  on  any  of  its  hedging  lines.   Foreign  Currency  Exchange  Risk     Currency  fluctuations  may  affect  the  revenues  which  the  Company  will  realize  from  its  operations  since  gold  and  silver  are  sold  in   the  world  market  in  United  States  dollars.    The  costs  of  Kinross  are  incurred  principally  in  Canadian  dollars,  United  States   dollars,   Chilean   pesos,   Brazilian   reais,   Russian   roubles,   Mauritanian   ouguiya   and   Ghanaian   cedis.     The   appreciation   of   non-­‐U.S.   dollar   currencies  against  the  U.S.  dollar  increases  the  cost  of  gold  and  silver  production  in  U.S.  dollar  terms.    Kinross’  results  are  positively   affected  when  the  U.S.  dollar  strengthens  against  these  foreign  currencies  and  are  adversely  affected  when  the  U.S.  dollar  weakens   against   these   foreign   currencies.     Where   possible,   Kinross’   cash   and   cash   equivalents   balances   are   primarily   held   in   U.S.   dollars.     From  time  to  time,  Kinross  transacts  currency  hedging  to  reduce  the  risk  associated  with  currency  fluctuations.    While  the  Chilean   peso,  Brazilian  real,  and  Russian  rouble  are  currently  convertible  into  Canadian  and  United  States  dollars,  they  may  not  always  be   convertible   in   the   future.     The   Mauritanian   ouguiya   and   Ghanaian   cedis   are   convertible   into   Canadian   and   U.S.   dollars,   but   conversion  may  be  subject  to  regulatory  and/or  central  bank  approval.   The   sensitivity   of   the   Company’s   pre-­‐tax   earnings   to   changes   in   the   U.S.   dollar   is   disclosed   in   Note   11   of   the   Company’s   financial   statements  for  the  year  ended  December  31,  2017.   Litigation  Risk   Legal  proceedings  may  be  brought  against  Kinross,  for  example,  litigation  based  on  its  business  activities,  environmental  laws,  tax   matters,  volatility  in  its  stock  price  or  failure  to  comply  with  its  disclosure  obligations,  which  could  have  a  material  adverse  effect  on   Kinross’  financial  condition  or  prospects.  Regulatory  and  government  agencies  may  bring  legal  proceedings  in  connection  with  the   enforcement  of  applicable  laws  and  regulations,  and  as  a  result  Kinross  may  be  subject  to  expenses  of  investigations  and  defense,   fines  or  penalties  for  violations  if  proven,  and  potentially  cost  and  expense  to  remediate,  increased   operating  costs  or  changes  to   operations,   and   cessation   of   operations   if   ordered   to   do   so   or   required   in   order   to   resolve   such   proceedings.   In   the   event   of   a   dispute  arising  at  Kinross’  foreign  operations,  Kinross  may  be  subject  to  the  exclusive  jurisdiction  of  foreign  courts  or  may  not  be   successful  in  subjecting  foreign  persons  to  the  jurisdiction  of  courts  in  Canada.  Kinross’  inability  to  enforce  its  rights  could  have  an   adverse  effect  on  its  future  cash  flows,  earnings,  results  of  operations  and  financial  condition.   Counterparty  and  Liquidity  Risk     Credit  risk  relates  to  cash  and  cash  equivalents,  accounts  receivable,  and  derivative  contracts  and  arises  from  the  possibility  that  a   counterparty  to  an  instrument  fails  to  perform.    Counterparty  risk  is  the  risk  that  a  third  party  might  fail  to  fulfill  its  performance   obligations  under  the  terms  of  a  financial  instrument.    The  Company  is  subject  to  counterparty  risk  and  may  be  affected,  in  the  event   that   a   counterparty   becomes   insolvent.     To   manage   both   counterparty   and   credit   risk,   the   Company   proactively   manages   its   exposure   to   individual   counterparties.     The   Company   only   transacts   with   highly-­‐rated   counterparties.     A   limit   on   contingent   exposure   has   been   established   for   each   counterparty   based   on   the   counterparty's   credit   rating,   and   the   Company   monitors   the   financial  condition  of  each  counterparty.       As   at   December   31,   2017,   the   Company's   gross   credit   exposure,   including   cash   and   cash   equivalents,   was   $1,358.7   million   and   at   December  31,  2016,  the  gross  credit  exposure,  including  cash  and  cash  equivalents,  was  $1,075.2  million.     Liquidity   risk   is   the   risk   that   the   Company   may   not   have   sufficient   cash   resources   available   to   meet   its   payment   obligations.     To   manage  liquidity  risk,  the  Company  maintains  cash  positions  and  has  financing  in  place  that  the  Company  expects  will  be  sufficient  to   meet  its  operating  and  capital  expenditure  requirements.    Potential  sources  for  liquidity  could  include,  but  are  not  limited  to:  the   Company's   current   cash   position,   existing   credit   facilities,   future   operating   cash   flow,   and   potential   private   and   public   financing.   Additionally,   the   Company   reviews   its   short-­‐term   operational   forecasts   regularly   and   long-­‐term   budgets   to   determine   its   cash   requirements.   Credit  Ratings   The   Company’s   ability   to   access   debt   markets   and   the   related   cost   of   debt   financing   is   dependent   upon   its   credit   ratings.     The   Company  has  a  BBB-­‐  rating  from  Fitch  Ratings,  a  Ba1  rating  from  Moody’s  and  a  BB+  rating  from  Standard    &  Poor’s.  There  is  no   assurance  that  these  credit  ratings  will  remain  in  effect  for  any  given  period  of  time  or  that  any  such  ratings  will  not  be  revised  or   Potential  for  Incurring  Unexpected  Costs  or  Liabilities  as  a  Result  of  Acquisitions     Although  the  Company  conducts  investigations  in  connection  with  acquisitions,  risks  remain  regarding  any  undisclosed  or  unknown   liabilities   associated   with   any   such   acquisitions,   and   the   Company   may   discover   that   it   has   acquired   substantial   undisclosed   liabilities.     The   Company   may   have   little   recourse   against   the   seller   if   any   of   the   representations   or   warranties   provided   in   connection  with  an  acquisition  proves  to  be  inaccurate.    Such  liabilities  could  have  an  adverse  impact  on  the  Company's  business,   financial  condition,  results  of  operations  and  cash  flows.   Global  Financial  Condition     The   volatility   and   challenges   that   economies   continue   to   experience   around   the   world   continues   to   affect   the   profitability   and   liquidity   of   businesses   in   many   industries,   which   in   turn   has   resulted   in   the   following   conditions   that   may   have   an   effect   on   the   profitability  and  cash  flows  of  the  Company:     • • • • Volatility  in  commodity  prices  and  foreign  exchange  rates;     Tightening  of  credit  markets;     Counterparty  risk;  and     Volatility  in  the  prices  of  publicly  traded  entities.     The  volatility  in  commodity  prices  and  foreign  exchange  rates  directly  impact  the  Company’s  revenues,  earnings  and  cash  flows,  as   noted  above  in  the  sections  titled  “Gold  Price  and  Silver  Price”  and  “Foreign  Currency  Exchange  Risk”.     Although  the  tighter  credit  markets  have  restricted  the  ability  of  certain  companies  to  access  capital,  to  date  this  has  not  affected   the  Company's  liquidity.       The  Company  extended  the  maturity  date  of  its  revolving  credit  facility  by  one  year  to  August  2022.    As  at  December  31,  2017,  the   Company  had  $1,563.8  million  available  under  its  credit  facility  arrangements.    However,  continued  tightening  of  credit  markets  may   affect  the  ability  of  the  Company  to  obtain  equity  or  debt  financing  in  the  future  on  terms  favourable  to  the  Company.   The   Company   has   not   experienced   any   difficulties   to   date   relating   to   the   counterparties   it   transacts   with.     The   counterparties   continue  to  be  highly  rated,  and  as  noted  above,  the  Company  has  employed  measures  to  reduce  the  impact  of  counterparty  risk.     Continued  volatility  in  equity  markets  may  affect  the  value  of  publicly  listed  companies  in  Kinross'  equity  portfolio.    Should  declines   in  the  equity  values  continue  and  are  deemed  to  be  other  than  temporary,  impairment  losses  may  result.   Market  Price  Risk     Kinross’  common  shares  are  listed  on  the  Toronto  Stock  Exchange  (“TSX”)  and  the  New  York  Stock  Exchange  (“NYSE”).    The  price  of   Kinross’  common  shares  is  likely  to  be  significantly  affected  by  short-­‐term  changes  in  the  gold  price  or  in  its  financial  condition  or   results  of  operations  as  reflected  in  its  quarterly  earnings  reports.    Other  factors  unrelated  to  the  performance  of  Kinross  that  may   have   an   effect   on   the   price   of   the   Kinross   common   shares   include   the   following:   a   reduction   in   analytical   coverage   of   Kinross   by   investment   banks   with   research   capabilities;   increased   political   risk   in   countries   where   the   Company   operates;   a   drop   in   trading   volume  and  general  market  interest  in  the  securities  of  Kinross  may  adversely  affect  an  investor’s  ability  to  liquidate  an  investment   and  consequently  an  investor’s  interest  in  acquiring  a  significant  stake  in  Kinross;  a  failure  of  Kinross  to  meet  the  reporting  and  other   obligations  under  Canadian  and  U.S.  securities  laws  or  imposed  by  the  exchanges  could  result  in  a  delisting  of  the  Kinross  common   shares;  and  a  substantial  decline  in  the  price  of  the  Kinross  common  shares  that  persists  for  a  significant  period  of  time  could  cause   the  Kinross  common  shares  to  be  delisted  from  the  TSX  or  NYSE  further  reducing  market  liquidity.   As  a  result  of  any  of  these  factors,  the  market  price  of  Kinross’  common  shares  at  any  given  point  in  time  may  not  accurately  reflect   Kinross’   long-­‐term   value.     Securities   class   action   litigation   has   been   commenced   against   companies,   including   Kinross,   following   periods  of  volatility  or  significant  decline  in  the  market  price  of  their  securities.    Securities  litigation  could  result  in  substantial  costs   and  damages  and  divert  management’s  attention  and  resources.  Any   decision  resulting  from  any  such  litigation  that  is  adverse  to   the  Company  could  have  a  negative  impact  on  the  Company’s  financial  position.   48 49 KINROSS ANNUAL REPORT MDA 49                                                 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Impairment     Kinross   evaluates,   on   at   least   an   annual   basis,   the   carrying   amount   of   its   CGUs   to   determine   whether   current   events   and   circumstances   indicate   that   such   carrying   amount   may   no   longer   be   recoverable.     Goodwill   is   required   to   be   tested   annually   for   impairment  and  Kinross  performs  this  annual  test  at  the  end  of  the  fourth  quarter.    In  addition,  at  each  reporting  period  end,  Kinross   assesses  whether  there  is  any  indication  that  any  of  its  CGUs’  carrying  amounts  exceed  their  recoverable  amounts,  and  if  there  is   such  an  indication,  the  Company  would  test  for  potential  impairment  at  that  time.    The  recoverable  amounts,  or  fair  values,  of  its   CGUs  are  based,  in  part,  on  certain  factors  that  may  be  partially  or  totally  outside  of  Kinross’  control.    Kinross’  fair  value  estimates   are  based  on  numerous  assumptions,  some  of  which  may  be  subjective,  and  it  is  possible  that  actual  fair  value  could  be  significantly   different  than  those  estimates.       KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   11. SUPPLEMENTAL  INFORMATION     Reconciliation  of  Non-­‐GAAP  Financial  Measures   Paracatu  Water  Supply  and  Use   Adjusted  Net  Earnings  Attributable  to  Common  Shareholders  and  Adjusted  Net  Earnings  per  Share   Operations  at  Paracatu  are  dependent  on  rainfall  and  river  water  capture  as  the  primary  source  of  process  water.    During  the  rainy   season,   the   mine   channels   surface   runoff   water   to   temporary   storage   ponds   from   where   it   is   pumped   to   the   process   plants.     Similarly,  surface  runoff  and  rain  water  and  water  captured  from  the  river  is  stored  in  the  tailings  impoundment,  which  constitutes   the  main  water  reservoir  for  the  process  plants.    The  objective  is  to  capture  and  store  as  much  water  as  possible  during  the  rainy   season  to  ensure  adequate  water  supply  during  the  dry  season.     Accordingly,  prolonged  periods  without  adequate  rainfall  may  adversely  impact  operations  at  Paracatu.    As  a  result,  production  may   fall   below   historic   or   forecast   levels   and   Kinross   may   incur   significant   costs   or   experience   significant   delays   that   could   have   a   material  effect  on  Kinross’  financial  performance,  liquidity  and  results  of  operations.   Human  Resources   In   order   to   operate   successfully,   Kinross   must   find   and   retain   qualified   employees.     Kinross   and   other   companies   in   the   mining   industry  compete  for  personnel  and  Kinross  is  not  always  able  to  fill  positions  in  a  timely  manner.    One  factor  that  has  contributed  to   an   increased   turnover   rate   is   the   ageing   workforce   and   it   is   expected   that   this   factor   will   further   increase   the   turnover   rate   in   upcoming   years.     If   Kinross   is   unable   to   attract   and   retain   qualified   personnel   or   fails   to   establish   adequate   succession   planning   strategies,  Kinross’  operations  could  be  adversely  affected.     In   addition,   Kinross   has   a   relatively   small   executive   management   team   and   in   the   event   that   the   services   of   a   number   of   these   executives   are   no   longer   available,   Kinross   and   its   business   could   be   adversely   affected.     Kinross   does   not   carry   key-­‐man   life   insurance  with  respect  to  its  executives.     Cybersecurity  Risks   The  Company  relies  heavily  on  its  information  technology  systems  including,  without  limitation,  its  networks,  equipment,  hardware,   software,  telecommunications,  and  other  information  technology  (collectively,  “IT  systems”),  and  the  IT  systems  of  its  vendors  and   third-­‐party  service  providers,  to  operate  its  business  as  a  whole  including  mining  operations  and  development  projects.     IT   systems   are   subject   to   an   increasing   threat   of   continually   evolving   cybersecurity   risks   including,   without   limitation,   computer   viruses,  security  breaches,  and  cyberattacks.  In  addition,  the  Company  is  subject  to  the  risk  of  unauthorized  access  to  its  IT  systems   or   its   information   through   fraud   or   other   means.   Kinross’   operations   also   depend   on   the   timely   maintenance,   upgrade   and   replacement  of  its  IT  systems,  as  well  as  pre-­‐emptive  expenses  to  mitigate  cybersecurity  risks  and  other  IT  systems  disruptions.   Although  Kinross  has  not  experienced  any  material  losses  to  date  relating  to  cybersecurity,  or  other  IT  systems  disruptions,  there  can   be   no   assurance   that   Kinross   will   not   incur   such   losses   in   the   future.   Despite   the   Company’s   mitigation   efforts   including   implementing  an  IT  systems  security  risk  management  framework,  the  risk  and  exposure  to  these  threats  cannot  be  fully  mitigated   because   of,   among   other   things,   the   evolving   nature   of   cybersecurity   threats.   As   a   result,   cybersecurity   and   the   continued   development   and   enhancement   of   controls,   processes   and   practices   designed   to   protect   IT   systems   from   cybersecurity   threats   remain   a   priority.   As   these   threats   continue   to   evolve,   the   Company,   its   vendors   and   third-­‐party   service   providers,   including   IT   service   providers,   may   be   required   to   expend   additional   resources   to   continue   to   modify   or   enhance   protective   measures   or   to   investigate  and  remediate  any  cybersecurity  vulnerabilities.   Any  cybersecurity  incidents  or  other  IT  systems  disruption  could  result  in  production  downtimes,  operational  delays,  destruction  or   corruption   of   data,   security   breaches,   financial   losses   from   remedial   actions,   the   theft   or   other   compromising   of   confidential   or   otherwise  protected  information,  fines  and  lawsuits,  or  damage  to  the  Company’s  reputation.  Any  such  occurrence  could  have  an   adverse  impact  on  Kinross’  financial  condition  and  results  of  operations.   50 KINROSS ANNUAL REPORT MDA 50 The  Company  has  included  certain  non-­‐GAAP  financial  measures  in  this  document.    These  measures  are  not  defined  under  IFRS  and   should   not   be   considered   in   isolation.     The   Company   believes   that   these   measures,   together   with   measures   determined   in   accordance   with   IFRS,   provide   investors   with   an   improved   ability   to   evaluate   the   underlying   performance   of   the   Company.     The   inclusion   of   these   measures   is   meant   to   provide   additional   information   and   should   not   be   used   as   a   substitute   for   performance   measures  prepared  in  accordance  with  IFRS.    These  measures  are  not  necessarily  standard  and  therefore  may  not  be  comparable  to   other  issuers.   Adjusted   net   earnings   attributable   to   common   shareholders   and   adjusted   net   earnings   per   share   are   non-­‐GAAP   measures   which   determine   the   performance   of   the   Company,   excluding   certain   impacts   which   the   Company   believes   are   not   reflective   of   the   Company’s  underlying  performance  for  the  reporting  period,  such  as  the  impact  of  foreign  exchange  gains  and  losses,  reassessment   of  prior  year  taxes  and/or  taxes  otherwise  not  related  to  the  current  period,  impairment  charges  (reversals),  gains  and  losses  and   other   one-­‐time   costs   related   to   acquisitions,   dispositions   and   other   transactions,   and   non-­‐hedge   derivative   gains   and   losses.     Although   some   of   the   items   are   recurring,   the   Company   believes   that   they   are   not   reflective   of   the   underlying   operating   performance  of  its  current  business  and  are  not  necessarily  indicative  of  future  operating  results.    Management  believes  that  these   measures,   which   are   used   internally   to   assess   performance   and   in   planning   and   forecasting   future   operating   results,   provide   investors  with  the  ability  to  better  evaluate  underlying  performance,  particularly  since  the  excluded  items  are  typically  not  included   in  public  guidance.    However,  adjusted  net  earnings  and  adjusted  net  earnings  per  share  measures  are  not  necessarily  indicative  of   net  earnings  and  earnings  per  share  measures  as  determined  under  IFRS.   The  following  table  provides  a  reconciliation  of  net  earnings  (loss)  to  adjusted  net  earnings  for  the  periods  presented:   Net  earnings  (loss)  attributable  to  common  shareholders  -­‐  as  reported $                                                       445.4 $                                                           (104.0) Years  ended  December  31, 2017 2016 Gain  on  disposition  of  associate  and  interests  and  other  assets  -­‐  net Foreign  exchange  losses  (gains)  on  translation  of  tax  basis  and  foreign  exchange  on  deferred   (in  millions,  except  per  share  amounts) Adjusting  items: Foreign  exchange  losses income  taxes  within  income  tax  expense Acquisition  costs   Tax  benefits  realized  upon  acquisition Impairment,  net  of  reversals (a) Taxes  in  respect  of  prior  years Mine  curtailment  and  suspension  related  costs (b) Reclamation  and  remediation  expense Chile  weather  event  related  costs Insurance  recoveries Settlement  of  a  royalty  agreement U.S.  Tax  Reform  impact Other(c) Tax  effect  of  the  above  adjustments (d) 4.9 (57.1) -­‐ -­‐ -­‐ (75.5) 41.7 16.6 9.5 3.3 (17.5) (9.9) (93.4) 1.2 (90.5) (266.7) 6.3 (9.7) (65.1) 7.8 (27.7) 139.6 85.5 40.4 27.2 (13.0) -­‐ -­‐ -­‐ 3.8 1.9 197.0 Adjusted  net  earnings  attributable  to  common  shareholders   Weighted  average  number  of  common  shares  outstanding  -­‐  Basic Adjusted  net  earnings  per  share   $                                                       178.7 $                                                                     93.0 1,246.6 1,227.0 $                                                             0.14 $                                                                     0.08 (a)  During  the  year  ended  December  31,  2017,  the  Company  recognized  an  impairment  charge  related  to  Paracatu  of  $253.0  million  and   reversals  of  impairment  charges  of  $231.5  million  related  to  property,  plant  and  equipment  at  Tasiast  and  Fort  Knox.  The  Company  also   recognized  a  reversal  of  impairment  charges  related  to  the  disposal  of  its  25%  interest  in  Cerro  Casale  of  $97.0  million  during  the  year  ended   December  31,  2017. (b)  Includes  costs  related  to  the  temporary  curtailment  at  Paracatu  during  the  year  ended  December  31,  2017  of  $16.6  million.  During  the   year  ended  December  31,  2016,  mine  curtailment  and  suspension  related  costs  includes  costs  related  to  the  temporary  suspension  of   operations  at  Tasiast  and  the  suspension  of  mining  activities  at  Maricunga. (c)  Other  includes  non-­‐hedge  derivatives  losses  (gains). (d)  Includes  a  net  tax  recovery  of  $83.6  million  related  to  the  impairment  charge  at  Paracatu  and  impairment  reversal  at  Fort  Knox  recognized   during  the  year  ended  December  31,  2017. 51                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Impairment     Kinross   evaluates,   on   at   least   an   annual   basis,   the   carrying   amount   of   its   CGUs   to   determine   whether   current   events   and   circumstances   indicate   that   such   carrying   amount   may   no   longer   be   recoverable.     Goodwill   is   required   to   be   tested   annually   for   impairment  and  Kinross  performs  this  annual  test  at  the  end  of  the  fourth  quarter.    In  addition,  at  each  reporting  period  end,  Kinross   assesses  whether  there  is  any  indication  that  any  of  its  CGUs’  carrying  amounts  exceed  their  recoverable  amounts,  and  if  there  is   such  an  indication,  the  Company  would  test  for  potential  impairment  at  that  time.    The  recoverable  amounts,  or  fair  values,  of  its   CGUs  are  based,  in  part,  on  certain  factors  that  may  be  partially  or  totally  outside  of  Kinross’  control.    Kinross’  fair  value  estimates   are  based  on  numerous  assumptions,  some  of  which  may  be  subjective,  and  it  is  possible  that  actual  fair  value  could  be  significantly   different  than  those  estimates.       Paracatu  Water  Supply  and  Use   Operations  at  Paracatu  are  dependent  on  rainfall  and  river  water  capture  as  the  primary  source  of  process  water.    During  the  rainy   season,   the   mine   channels   surface   runoff   water   to   temporary   storage   ponds   from   where   it   is   pumped   to   the   process   plants.     Similarly,  surface  runoff  and  rain  water  and  water  captured  from  the  river  is  stored  in  the  tailings  impoundment,  which  constitutes   the  main  water  reservoir  for  the  process  plants.    The  objective  is  to  capture  and  store  as  much  water  as  possible  during  the  rainy   season  to  ensure  adequate  water  supply  during  the  dry  season.     Accordingly,  prolonged  periods  without  adequate  rainfall  may  adversely  impact  operations  at  Paracatu.    As  a  result,  production  may   fall   below   historic   or   forecast   levels   and   Kinross   may   incur   significant   costs   or   experience   significant   delays   that   could   have   a   material  effect  on  Kinross’  financial  performance,  liquidity  and  results  of  operations.   Human  Resources   In   order   to   operate   successfully,   Kinross   must   find   and   retain   qualified   employees.     Kinross   and   other   companies   in   the   mining   industry  compete  for  personnel  and  Kinross  is  not  always  able  to  fill  positions  in  a  timely  manner.    One  factor  that  has  contributed  to   an   increased   turnover   rate   is   the   ageing   workforce   and   it   is   expected   that   this   factor   will   further   increase   the   turnover   rate   in   upcoming   years.     If   Kinross   is   unable   to   attract   and   retain   qualified   personnel   or   fails   to   establish   adequate   succession   planning   strategies,  Kinross’  operations  could  be  adversely  affected.     In   addition,   Kinross   has   a   relatively   small   executive   management   team   and   in   the   event   that   the   services   of   a   number   of   these   executives   are   no   longer   available,   Kinross   and   its   business   could   be   adversely   affected.     Kinross   does   not   carry   key-­‐man   life   insurance  with  respect  to  its  executives.     Cybersecurity  Risks   The  Company  relies  heavily  on  its  information  technology  systems  including,  without  limitation,  its  networks,  equipment,  hardware,   software,  telecommunications,  and  other  information  technology  (collectively,  “IT  systems”),  and  the  IT  systems  of  its  vendors  and   third-­‐party  service  providers,  to  operate  its  business  as  a  whole  including  mining  operations  and  development  projects.     IT   systems   are   subject   to   an   increasing   threat   of   continually   evolving   cybersecurity   risks   including,   without   limitation,   computer   viruses,  security  breaches,  and  cyberattacks.  In  addition,  the  Company  is  subject  to  the  risk  of  unauthorized  access  to  its  IT  systems   or   its   information   through   fraud   or   other   means.   Kinross’   operations   also   depend   on   the   timely   maintenance,   upgrade   and   replacement  of  its  IT  systems,  as  well  as  pre-­‐emptive  expenses  to  mitigate  cybersecurity  risks  and  other  IT  systems  disruptions.   Although  Kinross  has  not  experienced  any  material  losses  to  date  relating  to  cybersecurity,  or  other  IT  systems  disruptions,  there  can   be   no   assurance   that   Kinross   will   not   incur   such   losses   in   the   future.   Despite   the   Company’s   mitigation   efforts   including   implementing  an  IT  systems  security  risk  management  framework,  the  risk  and  exposure  to  these  threats  cannot  be  fully  mitigated   because   of,   among   other   things,   the   evolving   nature   of   cybersecurity   threats.   As   a   result,   cybersecurity   and   the   continued   development   and   enhancement   of   controls,   processes   and   practices   designed   to   protect   IT   systems   from   cybersecurity   threats   remain   a   priority.   As   these   threats   continue   to   evolve,   the   Company,   its   vendors   and   third-­‐party   service   providers,   including   IT   service   providers,   may   be   required   to   expend   additional   resources   to   continue   to   modify   or   enhance   protective   measures   or   to   investigate  and  remediate  any  cybersecurity  vulnerabilities.   Any  cybersecurity  incidents  or  other  IT  systems  disruption  could  result  in  production  downtimes,  operational  delays,  destruction  or   corruption   of   data,   security   breaches,   financial   losses   from   remedial   actions,   the   theft   or   other   compromising   of   confidential   or   otherwise  protected  information,  fines  and  lawsuits,  or  damage  to  the  Company’s  reputation.  Any  such  occurrence  could  have  an   adverse  impact  on  Kinross’  financial  condition  and  results  of  operations.   50 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   11. SUPPLEMENTAL  INFORMATION     Reconciliation  of  Non-­‐GAAP  Financial  Measures   The  Company  has  included  certain  non-­‐GAAP  financial  measures  in  this  document.    These  measures  are  not  defined  under  IFRS  and   should   not   be   considered   in   isolation.     The   Company   believes   that   these   measures,   together   with   measures   determined   in   accordance   with   IFRS,   provide   investors   with   an   improved   ability   to   evaluate   the   underlying   performance   of   the   Company.     The   inclusion   of   these   measures   is   meant   to   provide   additional   information   and   should   not   be   used   as   a   substitute   for   performance   measures  prepared  in  accordance  with  IFRS.    These  measures  are  not  necessarily  standard  and  therefore  may  not  be  comparable  to   other  issuers.   Adjusted  Net  Earnings  Attributable  to  Common  Shareholders  and  Adjusted  Net  Earnings  per  Share   Adjusted   net   earnings   attributable   to   common   shareholders   and   adjusted   net   earnings   per   share   are   non-­‐GAAP   measures   which   determine   the   performance   of   the   Company,   excluding   certain   impacts   which   the   Company   believes   are   not   reflective   of   the   Company’s  underlying  performance  for  the  reporting  period,  such  as  the  impact  of  foreign  exchange  gains  and  losses,  reassessment   of  prior  year  taxes  and/or  taxes  otherwise  not  related  to  the  current  period,  impairment  charges  (reversals),  gains  and  losses  and   other   one-­‐time   costs   related   to   acquisitions,   dispositions   and   other   transactions,   and   non-­‐hedge   derivative   gains   and   losses.     Although   some   of   the   items   are   recurring,   the   Company   believes   that   they   are   not   reflective   of   the   underlying   operating   performance  of  its  current  business  and  are  not  necessarily  indicative  of  future  operating  results.    Management  believes  that  these   measures,   which   are   used   internally   to   assess   performance   and   in   planning   and   forecasting   future   operating   results,   provide   investors  with  the  ability  to  better  evaluate  underlying  performance,  particularly  since  the  excluded  items  are  typically  not  included   in  public  guidance.    However,  adjusted  net  earnings  and  adjusted  net  earnings  per  share  measures  are  not  necessarily  indicative  of   net  earnings  and  earnings  per  share  measures  as  determined  under  IFRS.   The  following  table  provides  a  reconciliation  of  net  earnings  (loss)  to  adjusted  net  earnings  for  the  periods  presented:   (in  millions,  except  per  share  amounts) Net  earnings  (loss)  attributable  to  common  shareholders  -­‐  as  reported Adjusting  items: Foreign  exchange  losses Gain  on  disposition  of  associate  and  interests  and  other  assets  -­‐  net Foreign  exchange  losses  (gains)  on  translation  of  tax  basis  and  foreign  exchange  on  deferred   income  taxes  within  income  tax  expense Acquisition  costs   Tax  benefits  realized  upon  acquisition Impairment,  net  of  reversals (a) Taxes  in  respect  of  prior  years Mine  curtailment  and  suspension  related  costs (b) Reclamation  and  remediation  expense Chile  weather  event  related  costs Insurance  recoveries Settlement  of  a  royalty  agreement U.S.  Tax  Reform  impact Other(c) Tax  effect  of  the  above  adjustments (d) Adjusted  net  earnings  attributable  to  common  shareholders   Weighted  average  number  of  common  shares  outstanding  -­‐  Basic Adjusted  net  earnings  per  share   Years  ended  December  31, 2017 2016 $                                                       445.4 $                                                           (104.0) 4.9 (57.1) 6.3 (9.7) -­‐ -­‐ -­‐ (75.5) 41.7 16.6 9.5 3.3 (17.5) (9.9) (93.4) 1.2 (90.5) (266.7) 178.7 1,246.6 0.14 (65.1) 7.8 (27.7) 139.6 85.5 40.4 27.2 -­‐ (13.0) -­‐ -­‐ 3.8 1.9 197.0 93.0 1,227.0 0.08 $                                                       $                                                                     $                                                             $                                                                     (a)  During  the  year  ended  December  31,  2017,  the  Company  recognized  an  impairment  charge  related  to  Paracatu  of  $253.0  million  and   reversals  of  impairment  charges  of  $231.5  million  related  to  property,  plant  and  equipment  at  Tasiast  and  Fort  Knox.  The  Company  also   recognized  a  reversal  of  impairment  charges  related  to  the  disposal  of  its  25%  interest  in  Cerro  Casale  of  $97.0  million  during  the  year  ended   December  31,  2017. (b)  Includes  costs  related  to  the  temporary  curtailment  at  Paracatu  during  the  year  ended  December  31,  2017  of  $16.6  million.  During  the   year  ended  December  31,  2016,  mine  curtailment  and  suspension  related  costs  includes  costs  related  to  the  temporary  suspension  of   operations  at  Tasiast  and  the  suspension  of  mining  activities  at  Maricunga. (c)  Other  includes  non-­‐hedge  derivatives  losses  (gains). (d)  Includes  a  net  tax  recovery  of  $83.6  million  related  to  the  impairment  charge  at  Paracatu  and  impairment  reversal  at  Fort  Knox  recognized   during  the  year  ended  December  31,  2017. 51 KINROSS ANNUAL REPORT MDA 51                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Adjusted  Operating  Cash  Flow     The  Company  makes  reference  to  a  non-­‐GAAP  measure  for  adjusted  operating  cash  flow.    Adjusted  operating  cash  flow  is  defined  as   cash   flow   from   operations   excluding   certain   impacts   which   the   Company   believes   are   not   reflective   of   the   Company’s   regular   operating  cash  flow  and  excluding  changes  in  working  capital.    Working  capital  can  be  volatile  due  to  numerous  factors,  including  the   timing  of  tax  payments,  and  in  the  case  of  Kupol,  a  build-­‐up  of  inventory  due  to  transportation  logistics.    The  Company  uses  adjusted   operating   cash   flow   internally   as   a   measure   of   the   underlying   operating   cash   flow   performance   and   future   operating   cash   flow-­‐ generating  capability  of  the  Company.    However,  the  adjusted  operating  cash  flow  measure  is  not  necessarily  indicative  of  net  cash   flow  from  operations  as  determined  under  IFRS.   The  following  table  provides  a  reconciliation  of  adjusted  cash  flow  for  the  periods  presented:   Management  uses  these  measures  to  monitor  and  evaluate  the  performance  of  its  operating  properties.   (in  millions) Net  cash  flow  provided  from  operating  activities  -­‐  as  reported Adjusting  items: Working  capital  changes: Accounts  receivable  and  other  assets Inventories Accounts  payable  and  other  liabilities,  including  taxes Years  ended  December  31, 2017 2016 $                                                       951.6 $                                                     1,099.2 (108.6) 86.7 237.0 215.1 21.2 (79.5) (114.2) (172.5) Adjusted  operating  cash  flow $                                               1,166.7 $                                                               926.7 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Consolidated  and  Attributable  Production  Cost  of  Sales  per  Equivalent  Ounce  Sold     Consolidated  production  cost  of  sales  per  gold  equivalent  ounce  sold  is  a  non-­‐GAAP  measure  and  is  defined  as  production  cost  of   sales   as   reported   on   the   consolidated   statement   of   operations   divided   by   the   total   number   of   gold   equivalent   ounces   sold.     This   measure  converts  the  Company’s  non-­‐gold  production  into  gold  equivalent  ounces  and  credits  it  to  total  production.   Attributable   production   cost   of   sales   per   gold   equivalent   ounce   sold   is   a   non-­‐GAAP   measure   and   is   defined   as   attributable   production  cost  of  sales  divided  by  the  attributable  number  of  gold  equivalent  ounces  sold.    This  measure  converts  the  Company’s   non-­‐gold  production  into  gold  equivalent  ounces  and  credits  it  to  total  production.     The  following  table  provides  a  reconciliation  of  consolidated  and  attributable  production  cost  of  sales  per  equivalent  ounce  sold  for   the  periods  presented:   (in  millions,  except  ounces  and  production  cost  of  sales  per  equivalent  ounce) Production  cost  of  sales  -­‐  as  reported   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest Attributable  production  cost  of  sales   Gold  equivalent  ounces  sold Less:  portion  attributable  to  Chirano  non-­‐controlling  interest Attributable  gold  equivalent  ounces  sold   Consolidated  production  cost  of  sales  per  equivalent  ounce  sold Attributable  production  cost  of  sales  per  equivalent  ounce  sold Years  ended  December  31, 2017 2016 $                                               1,757.4 $                                                     1,983.8 (20.0) (19.0) $                                               1,737.4 $                                                     1,964.8 2,621,875 (25,121) 2,596,754 2,778,902 (20,596) 2,758,306 $                                                                 670 $                                                                       714 $                                                                 669 $                                                                       712 52 KINROSS ANNUAL REPORT MDA 52 53                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Adjusted  Operating  Cash  Flow     The  Company  makes  reference  to  a  non-­‐GAAP  measure  for  adjusted  operating  cash  flow.    Adjusted  operating  cash  flow  is  defined  as   cash   flow   from   operations   excluding   certain   impacts   which   the   Company   believes   are   not   reflective   of   the   Company’s   regular   operating  cash  flow  and  excluding  changes  in  working  capital.    Working  capital  can  be  volatile  due  to  numerous  factors,  including  the   timing  of  tax  payments,  and  in  the  case  of  Kupol,  a  build-­‐up  of  inventory  due  to  transportation  logistics.    The  Company  uses  adjusted   operating   cash   flow   internally   as   a   measure   of   the   underlying   operating   cash   flow   performance   and   future   operating   cash   flow-­‐ generating  capability  of  the  Company.    However,  the  adjusted  operating  cash  flow  measure  is  not  necessarily  indicative  of  net  cash   flow  from  operations  as  determined  under  IFRS.   (in  millions) Net  cash  flow  provided  from  operating  activities  -­‐  as  reported Adjusting  items: Working  capital  changes: Accounts  receivable  and  other  assets Inventories Accounts  payable  and  other  liabilities,  including  taxes Years  ended  December  31, 2017 2016 $                                                       951.6 $                                                     1,099.2 (108.6) 86.7 237.0 215.1 21.2 (79.5) (114.2) (172.5) Adjusted  operating  cash  flow $                                               1,166.7 $                                                               926.7 The  following  table  provides  a  reconciliation  of  adjusted  cash  flow  for  the  periods  presented:   Management  uses  these  measures  to  monitor  and  evaluate  the  performance  of  its  operating  properties.   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Consolidated  and  Attributable  Production  Cost  of  Sales  per  Equivalent  Ounce  Sold     Consolidated  production  cost  of  sales  per  gold  equivalent  ounce  sold  is  a  non-­‐GAAP  measure  and  is  defined  as  production  cost  of   sales   as   reported   on   the   consolidated   statement   of   operations   divided   by   the   total   number   of   gold   equivalent   ounces   sold.     This   measure  converts  the  Company’s  non-­‐gold  production  into  gold  equivalent  ounces  and  credits  it  to  total  production.   Attributable   production   cost   of   sales   per   gold   equivalent   ounce   sold   is   a   non-­‐GAAP   measure   and   is   defined   as   attributable   production  cost  of  sales  divided  by  the  attributable  number  of  gold  equivalent  ounces  sold.    This  measure  converts  the  Company’s   non-­‐gold  production  into  gold  equivalent  ounces  and  credits  it  to  total  production.     The  following  table  provides  a  reconciliation  of  consolidated  and  attributable  production  cost  of  sales  per  equivalent  ounce  sold  for   the  periods  presented:   (in  millions,  except  ounces  and  production  cost  of  sales  per  equivalent  ounce) Production  cost  of  sales  -­‐  as  reported   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest Attributable  production  cost  of  sales   Gold  equivalent  ounces  sold Less:  portion  attributable  to  Chirano  non-­‐controlling  interest Attributable  gold  equivalent  ounces  sold   Consolidated  production  cost  of  sales  per  equivalent  ounce  sold Attributable  production  cost  of  sales  per  equivalent  ounce  sold Years  ended  December  31, 2017 2016 $                                               1,757.4 $                                                     1,983.8 (20.0) (19.0) $                                               1,737.4 $                                                     1,964.8 2,621,875 (25,121) 2,596,754 2,778,902 (20,596) 2,758,306 $                                                                 670 $                                                                       714 $                                                                 669 $                                                                       712 52 53 KINROSS ANNUAL REPORT MDA 53                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Attributable  Production  Cost  of  Sales  per  Ounce  Sold  on  a  By-­‐Product  Basis     Attributable  All-­‐In  Sustaining  Cost  and  All-­‐In  Cost  per  Ounce  Sold  on  a  By-­‐Product  Basis   Attributable  production  cost  of  sales  per  ounce  sold  on  a  by-­‐product  basis  is  a  non-­‐GAAP  measure  which  calculates  the  Company’s   non-­‐gold   production   as   a   credit   against   its   per   ounce   production   costs,   rather   than   converting   its   non-­‐gold   production   into   gold   equivalent   ounces   and   crediting   it   to   total   production,   as   is   the   case   in   co-­‐product   accounting.     Management   believes   that   this   measure   provides   investors   with   the   ability   to   better   evaluate   Kinross’   production   cost   of   sales   per   ounce   on   a   comparable   basis   with  other  major  gold  producers  who  routinely  calculate  their  cost  of  sales  per  ounce  using  by-­‐product  accounting  rather  than  co-­‐ product  accounting.   The  following  table  provides  a  reconciliation  of  attributable  production  cost  of  sales  per  ounce  sold  on  a  by-­‐product  basis  for  the   periods  presented:   (in  millions,  except  ounces  and  production  cost  of  sales  per  ounce) Production  cost  of  sales  -­‐  as  reported Less:  portion  attributable  to  Chirano  non-­‐controlling  interest Less:  attributable  silver  revenues   Years  ended  December  31, 2017 2016 $                                               1,757.4 $                                                     1,983.8 (20.0) (86.5) (19.0) (102.5) Attributable  production  cost  of  sales  net  of  silver  by-­‐product  revenue $                                               1,650.9 $                                                     1,862.3 Gold  ounces  sold   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest Attributable  gold  ounces  sold 2,553,178 (25,070) 2,528,108 2,697,912 (20,545) 2,677,367 Attributable  production  cost  of  sales  per  ounce  sold  on  a  by-­‐product  basis $                                                                 653 $                                                                       696 In  June  2013,  the  World  Gold  Council  (“WGC”)  published  its  guidelines  for  reporting  all-­‐in  sustaining  costs  and  all-­‐in  costs.    The  WGC   is  a  market  development  organization  for  the  gold  industry  and  is  an  association  whose  membership  comprises  leading  gold  mining   companies  including  Kinross.    Although  the  WGC  is  not  a  mining  industry  regulatory  organization,  it  worked  closely  with  its  member   companies  to  develop  these  non-­‐GAAP  measures.    Adoption  of  the  all-­‐in  sustaining  cost  and  all-­‐in  cost  metrics  is  voluntary  and  not   necessarily   standard,   and   therefore,   these   measures   presented   by   the   Company   may   not   be   comparable   to   similar   measures   presented   by   other   issuers.     The   Company   believes   that   the   all-­‐in   sustaining   cost   and   all-­‐in   cost   measures   complement   existing   measures  reported  by  Kinross.   All-­‐in  sustaining  cost  includes  both  operating  and  capital  costs  required  to  sustain  gold  production  on  an  ongoing  basis.    The  value  of   silver   sold   is   deducted   from   the   total   production   cost   of   sales   as   it   is   considered   residual   production.     Sustaining   operating   costs   represent   expenditures   incurred   at   current   operations   that   are   considered   necessary   to   maintain   current   production.     Sustaining   capital  represents  capital  expenditures  at  existing  operations  comprising  mine  development  costs  and  ongoing  replacement  of  mine   equipment  and  other  capital  facilities,  and  does  not  include  capital  expenditures  for  major  growth  projects  or  enhancement  capital   for  significant  infrastructure  improvements  at  existing  operations.   All-­‐in  cost  is  comprised  of  all-­‐in  sustaining  cost  as  well  as  operating  expenditures  incurred  at  locations  with  no  current  operation,  or   costs   related   to   other   non-­‐sustaining   activities,   and   capital   expenditures   for   major   growth   projects   or   enhancement   capital   for   significant  infrastructure  improvements  at  existing  operations.   Attributable  all-­‐in  sustaining  cost  and  all-­‐in  cost  per  ounce  sold  on  a  by-­‐product  basis  are  calculated  by  adjusting  total  production   cost  of  sales,  as  reported  on  the  consolidated  statement  of  operations,  as  follows:   (in  millions,  except  ounces  and  costs  per  ounce) Production  cost  of  sales  -­‐  as  reported   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest  (a) Less:  attributable  (b)  silver  revenues  (c) Attributable  (b)  production  cost  of  sales  net  of  silver  by-­‐product  revenue Adjusting  items  on  an  attributable  (b)  basis: General  and  administrative  (d) Other  operating  expense  -­‐  sustaining  (e) Reclamation  and  remediation  -­‐  sustaining  (f) Exploration  and  business  development  -­‐  sustaining  (g) Additions  to  property,  plant  and  equipment  -­‐  sustaining  (h) All-­‐in  Sustaining  Cost  on  a  by-­‐product  basis  -­‐  attributable  (b) Other  operating  expense  -­‐  non-­‐sustaining  (e) Reclamation  and  remediation  -­‐  non-­‐sustaining  (f) Exploration  -­‐  non-­‐sustaining  (g) Additions  to  property,  plant  and  equipment  -­‐  non-­‐sustaining  (h) All-­‐in  Cost  on  a  by-­‐product  basis  -­‐  attributable  (b) Gold  ounces  sold   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest  (i) Attributable  (b)  gold  ounces  sold   Attributable  (b)  all-­‐in  sustaining  cost  per  ounce  sold  on  a  by-­‐product  basis     Attributable  (b)  all-­‐in  cost  per  ounce  sold  on  a  by-­‐product  basis     Years  ended  December  31, 2017 2016 $                                             1,757.4 $                                             1,983.8 (20.0) (86.5) (19.0) (102.5) $                                             1,650.9 $                                             1,862.3 $                                             2,390.6 $                                             2,610.4 132.6 43.3 82.9 59.4 421.5 39.5 17.4 45.8 448.7 143.7 18.6 94.9 50.8 440.1 25.6 34.9 42.6 160.1 $                                             2,942.0 $                                             2,873.6 2,553,178 (25,070) 2,528,108 2,697,912 (20,545) 2,677,367 $                                                               946 $                                                               975 $                                                       1,164 $                                                       1,073 54 KINROSS ANNUAL REPORT MDA 54 55                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Attributable  Production  Cost  of  Sales  per  Ounce  Sold  on  a  By-­‐Product  Basis     Attributable  All-­‐In  Sustaining  Cost  and  All-­‐In  Cost  per  Ounce  Sold  on  a  By-­‐Product  Basis   Attributable  production  cost  of  sales  per  ounce  sold  on  a  by-­‐product  basis  is  a  non-­‐GAAP  measure  which  calculates  the  Company’s   non-­‐gold   production   as   a   credit   against   its   per   ounce   production   costs,   rather   than   converting   its   non-­‐gold   production   into   gold   equivalent   ounces   and   crediting   it   to   total   production,   as   is   the   case   in   co-­‐product   accounting.     Management   believes   that   this   measure   provides   investors   with   the   ability   to   better   evaluate   Kinross’   production   cost   of   sales   per   ounce   on   a   comparable   basis   with  other  major  gold  producers  who  routinely  calculate  their  cost  of  sales  per  ounce  using  by-­‐product  accounting  rather  than  co-­‐ The  following  table  provides  a  reconciliation  of  attributable  production  cost  of  sales  per  ounce  sold  on  a  by-­‐product  basis  for  the   product  accounting.   periods  presented:   (in  millions,  except  ounces  and  production  cost  of  sales  per  ounce) Production  cost  of  sales  -­‐  as  reported Less:  portion  attributable  to  Chirano  non-­‐controlling  interest Less:  attributable  silver  revenues   Gold  ounces  sold   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest Attributable  gold  ounces  sold Years  ended  December  31, 2017 2016 $                                               1,757.4 $                                                     1,983.8 (20.0) (86.5) 2,553,178 (25,070) 2,528,108 (19.0) (102.5) 2,697,912 (20,545) 2,677,367 Attributable  production  cost  of  sales  net  of  silver  by-­‐product  revenue $                                               1,650.9 $                                                     1,862.3 Attributable  production  cost  of  sales  per  ounce  sold  on  a  by-­‐product  basis $                                                                 653 $                                                                       696 In  June  2013,  the  World  Gold  Council  (“WGC”)  published  its  guidelines  for  reporting  all-­‐in  sustaining  costs  and  all-­‐in  costs.    The  WGC   is  a  market  development  organization  for  the  gold  industry  and  is  an  association  whose  membership  comprises  leading  gold  mining   companies  including  Kinross.    Although  the  WGC  is  not  a  mining  industry  regulatory  organization,  it  worked  closely  with  its  member   companies  to  develop  these  non-­‐GAAP  measures.    Adoption  of  the  all-­‐in  sustaining  cost  and  all-­‐in  cost  metrics  is  voluntary  and  not   necessarily   standard,   and   therefore,   these   measures   presented   by   the   Company   may   not   be   comparable   to   similar   measures   presented   by   other   issuers.     The   Company   believes   that   the   all-­‐in   sustaining   cost   and   all-­‐in   cost   measures   complement   existing   measures  reported  by  Kinross.   All-­‐in  sustaining  cost  includes  both  operating  and  capital  costs  required  to  sustain  gold  production  on  an  ongoing  basis.    The  value  of   silver   sold   is   deducted   from   the   total   production   cost   of   sales   as   it   is   considered   residual   production.     Sustaining   operating   costs   represent   expenditures   incurred   at   current   operations   that   are   considered   necessary   to   maintain   current   production.     Sustaining   capital  represents  capital  expenditures  at  existing  operations  comprising  mine  development  costs  and  ongoing  replacement  of  mine   equipment  and  other  capital  facilities,  and  does  not  include  capital  expenditures  for  major  growth  projects  or  enhancement  capital   for  significant  infrastructure  improvements  at  existing  operations.   All-­‐in  cost  is  comprised  of  all-­‐in  sustaining  cost  as  well  as  operating  expenditures  incurred  at  locations  with  no  current  operation,  or   costs   related   to   other   non-­‐sustaining   activities,   and   capital   expenditures   for   major   growth   projects   or   enhancement   capital   for   significant  infrastructure  improvements  at  existing  operations.   Attributable  all-­‐in  sustaining  cost  and  all-­‐in  cost  per  ounce  sold  on  a  by-­‐product  basis  are  calculated  by  adjusting  total  production   cost  of  sales,  as  reported  on  the  consolidated  statement  of  operations,  as  follows:   (in  millions,  except  ounces  and  costs  per  ounce) Production  cost  of  sales  -­‐  as  reported   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest  (a) Less:  attributable  (b)  silver  revenues  (c) Attributable  (b)  production  cost  of  sales  net  of  silver  by-­‐product  revenue Adjusting  items  on  an  attributable  (b)  basis: General  and  administrative  (d) Other  operating  expense  -­‐  sustaining  (e) Reclamation  and  remediation  -­‐  sustaining  (f) Exploration  and  business  development  -­‐  sustaining  (g) Additions  to  property,  plant  and  equipment  -­‐  sustaining  (h) All-­‐in  Sustaining  Cost  on  a  by-­‐product  basis  -­‐  attributable  (b) Other  operating  expense  -­‐  non-­‐sustaining  (e) Reclamation  and  remediation  -­‐  non-­‐sustaining  (f) Exploration  -­‐  non-­‐sustaining  (g) Additions  to  property,  plant  and  equipment  -­‐  non-­‐sustaining  (h) All-­‐in  Cost  on  a  by-­‐product  basis  -­‐  attributable  (b) Gold  ounces  sold   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest  (i) Attributable  (b)  gold  ounces  sold   Attributable  (b)  all-­‐in  sustaining  cost  per  ounce  sold  on  a  by-­‐product  basis     Attributable  (b)  all-­‐in  cost  per  ounce  sold  on  a  by-­‐product  basis     Years  ended  December  31, 2017 2016 $                                             1,757.4 $                                             1,983.8 (20.0) (86.5) (19.0) (102.5) $                                             1,650.9 $                                             1,862.3 132.6 43.3 82.9 59.4 421.5 143.7 18.6 94.9 50.8 440.1 $                                             2,390.6 $                                             2,610.4 39.5 17.4 45.8 448.7 25.6 34.9 42.6 160.1 $                                             2,942.0 $                                             2,873.6 2,553,178 (25,070) 2,528,108 2,697,912 (20,545) 2,677,367 $                                                               946 $                                                               975 $                                                       1,164 $                                                       1,073 54 55 KINROSS ANNUAL REPORT MDA 55                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Attributable  All-­‐In  Sustaining  Cost  and  All-­‐In  Cost  per  Equivalent  Ounce  Sold     The   Company   also   assesses   its   all-­‐in   sustaining   cost   and   all-­‐in   cost   on   a   gold   equivalent   ounce   basis.   Under   these   non-­‐GAAP   measures,  the  Company’s  production  of  silver  is  converted  into  gold  equivalent  ounces  and  credited  to  total  production.     Attributable  all-­‐in  sustaining  cost  and  all-­‐in  cost  per  equivalent  ounce  sold  are  calculated  by  adjusting  total  production  cost  of  sales,   as  reported  on  the  consolidated  statement  of  operations,  as  follows:   (in  millions,  except  ounces  and  costs  per  equivalent  ounce) Production  cost  of  sales  -­‐  as  reported Less:  portion  attributable  to  Chirano  non-­‐controlling  interest  (a) Attributable  (b)  production  cost  of  sales   Adjusting  items  on  an  attributable  (b)  basis: General  and  administrative  (d) Other  operating  expense  -­‐  sustaining  (e) Reclamation  and  remediation  -­‐  sustaining  (f) Exploration  and  business  development  -­‐  sustaining  (g) Additions  to  property,  plant  and  equipment  -­‐  sustaining  (h) All-­‐in  Sustaining  Cost  -­‐  attributable  (b) Other  operating  expense  -­‐  non-­‐sustaining  (e) Reclamation  and  remediation  -­‐  non-­‐sustaining  (f) Exploration  -­‐  non-­‐sustaining  (g) Additions  to  property,  plant  and  equipment  -­‐  non-­‐sustaining  (h) All-­‐in  Cost  -­‐  attributable  (b) Gold  equivalent  ounces  sold   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest  (i) Attributable  (b)  gold  equivalent  ounces  sold   Attributable  (b)  all-­‐in  sustaining  cost  per  equivalent  ounce  sold   Attributable  (b)  all-­‐in  cost  per  equivalent  ounce  sold   Years  ended  December  31, 2017 2016 $                                             1,757.4 $                                             1,983.8 (20.0) (19.0) $                                             1,737.4 $                                             1,964.8 132.6 43.3 82.9 59.4 421.5 143.7 18.6 94.9 50.8 440.1 $                                             2,477.1 $                                             2,712.9 39.5 17.4 45.8 448.7 25.6 34.9 42.6 160.1 $                                             3,028.5 $                                             2,976.1 2,621,875 (25,121) 2,596,754 2,778,902 (20,596) 2,758,306 $                                                               954 $                                                               984 $                                                       1,166 $                                                       1,079 (a) The portion attributable to Chirano non-­‐controlling interest represents the non-­‐controlling interest (10%) in the production cost of sales for  the  Chirano  mine. (b)  “Attributable”  includes  Kinross'  share  of  Chirano  (90%)  production. (c) “Attributable silver revenues” represents the attributable portion of metal sales realized from the production of the secondary or by-­‐ product metal (i.e. silver). Revenue from the sale of silver, which is produced as a by-­‐product of the process used to produce gold, effectively reduces  the  cost  of  gold  production. (d) “General and administrative” expenses is as reported on the consolidated statement of operations, net of certain severance expenses. General and administrative expenses are considered sustaining costs as they are required to be absorbed on a continuing basis for the effective  operation  and  governance  of  the  Company. (e) “Other operating expense – sustaining” is calculated as “Other operating expense” as reported on the consolidated statement of operations, less other operating and reclamation and remediation expenses related to non-­‐sustaining activities as well as other items not reflective of the underlying operating performance of our business. Other operating expenses are classified as either sustaining or non-­‐ sustaining based on the type and location of the expenditure incurred. The majority of other operating expenses that are incurred at existing operations are considered costs necessary to sustain operations, and are therefore classified as sustaining. Other operating expenses incurred  at  locations  where  there  is  no  current  operation  or  related  to  other  non-­‐sustaining  activities  are  classified  as  non-­‐sustaining. (f) “Reclamation and remediation -­‐ sustaining” is calculated as current period accretion related to reclamation and remediation obligations plus current period amortization of the corresponding reclamation and remediation assets, and is intended to reflect the periodic cost of reclamation and remediation for currently operating mines. Reclamation and remediation costs for development projects or closed mines are  excluded  from  this  amount  and  classified  as  non-­‐sustaining. (g) “Exploration and business development – sustaining” is calculated as “Exploration and business development” expenses as reported on the consolidated statement of operations, less non-­‐sustaining exploration expenses. Exploration expenses are classified as either sustaining or non-­‐sustaining based on a determination of the type and location of the exploration expenditure. Exploration expenditures within the footprint of operating mines are considered costs required to sustain current operations and so are included in sustaining costs. Exploration expenditures focused on new ore bodies near existing mines (i.e. brownfield), new exploration projects (i.e. greenfield) or for other generative exploration activity not linked to existing mining operations are classified as non-­‐sustaining. Business development expenses  are  considered  sustaining  costs  as  they  are  required  for  general  operations. (h)  “Additions  to  property,  plant  and  equipment  –  sustaining”  represents  the  majority  of  capital  expenditures  at  existing  operations  including   capitalized exploration costs, capitalized stripping and underground mine development costs, ongoing replacement of mine equipment and other capital facilities and other capital expenditures and is calculated as total additions to property, plant and equipment (as reported on the consolidated statements of cash flows), less capitalized interest and non-­‐sustaining capital. Non-­‐sustaining capital represents capital expenditures for major growth projects as well as enhancement capital for significant infrastructure improvements at existing operations. Non-­‐sustaining  capital  expenditures  during  the  year  ended  December  31,  2017,  primarily  relate  to  projects  at  Tasiast. (i) “Portion attributable to Chirano non-­‐controlling interest” represents the non-­‐controlling interest (10%) in the ounces sold from the Chirano  mine. (j) Average realized gold price is a non-­‐GAAP financial measure and is defined as gold metal sales divided by the total number of gold ounces sold. This measure is intended to enable Management to better understand the price realized in each reporting period. The realized price measure does not have any standardized definition under IFRS and should not be considered a substitute for measure of performance prepared  in  accordance  with  IFRS. 56 KINROSS ANNUAL REPORT MDA 56 57                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Attributable  All-­‐In  Sustaining  Cost  and  All-­‐In  Cost  per  Equivalent  Ounce  Sold     The   Company   also   assesses   its   all-­‐in   sustaining   cost   and   all-­‐in   cost   on   a   gold   equivalent   ounce   basis.   Under   these   non-­‐GAAP   measures,  the  Company’s  production  of  silver  is  converted  into  gold  equivalent  ounces  and  credited  to  total  production.     Attributable  all-­‐in  sustaining  cost  and  all-­‐in  cost  per  equivalent  ounce  sold  are  calculated  by  adjusting  total  production  cost  of  sales,   as  reported  on  the  consolidated  statement  of  operations,  as  follows:   (in  millions,  except  ounces  and  costs  per  equivalent  ounce) Production  cost  of  sales  -­‐  as  reported Less:  portion  attributable  to  Chirano  non-­‐controlling  interest  (a) Attributable  (b)  production  cost  of  sales   Adjusting  items  on  an  attributable  (b)  basis: General  and  administrative  (d) Other  operating  expense  -­‐  sustaining  (e) Reclamation  and  remediation  -­‐  sustaining  (f) Exploration  and  business  development  -­‐  sustaining  (g) Additions  to  property,  plant  and  equipment  -­‐  sustaining  (h) All-­‐in  Sustaining  Cost  -­‐  attributable  (b) Other  operating  expense  -­‐  non-­‐sustaining  (e) Reclamation  and  remediation  -­‐  non-­‐sustaining  (f) Exploration  -­‐  non-­‐sustaining  (g) Additions  to  property,  plant  and  equipment  -­‐  non-­‐sustaining  (h) All-­‐in  Cost  -­‐  attributable  (b) Gold  equivalent  ounces  sold   Less:  portion  attributable  to  Chirano  non-­‐controlling  interest  (i) Attributable  (b)  gold  equivalent  ounces  sold   Attributable  (b)  all-­‐in  sustaining  cost  per  equivalent  ounce  sold   Attributable  (b)  all-­‐in  cost  per  equivalent  ounce  sold   Years  ended  December  31, 2017 2016 $                                             1,757.4 $                                             1,983.8 (20.0) (19.0) $                                             1,737.4 $                                             1,964.8 $                                             2,477.1 $                                             2,712.9 132.6 43.3 82.9 59.4 421.5 39.5 17.4 45.8 448.7 143.7 18.6 94.9 50.8 440.1 25.6 34.9 42.6 160.1 $                                             3,028.5 $                                             2,976.1 2,621,875 (25,121) 2,596,754 2,778,902 (20,596) 2,758,306 $                                                               954 $                                                               984 $                                                       1,166 $                                                       1,079 (a) The portion attributable to Chirano non-­‐controlling interest represents the non-­‐controlling interest (10%) in the production cost of sales for  the  Chirano  mine. (b)  “Attributable”  includes  Kinross'  share  of  Chirano  (90%)  production. (c) “Attributable silver revenues” represents the attributable portion of metal sales realized from the production of the secondary or by-­‐ product metal (i.e. silver). Revenue from the sale of silver, which is produced as a by-­‐product of the process used to produce gold, effectively reduces  the  cost  of  gold  production. (d) “General and administrative” expenses is as reported on the consolidated statement of operations, net of certain severance expenses. General and administrative expenses are considered sustaining costs as they are required to be absorbed on a continuing basis for the effective  operation  and  governance  of  the  Company. (e) “Other operating expense – sustaining” is calculated as “Other operating expense” as reported on the consolidated statement of operations, less other operating and reclamation and remediation expenses related to non-­‐sustaining activities as well as other items not reflective of the underlying operating performance of our business. Other operating expenses are classified as either sustaining or non-­‐ sustaining based on the type and location of the expenditure incurred. The majority of other operating expenses that are incurred at existing operations are considered costs necessary to sustain operations, and are therefore classified as sustaining. Other operating expenses incurred  at  locations  where  there  is  no  current  operation  or  related  to  other  non-­‐sustaining  activities  are  classified  as  non-­‐sustaining. (f) “Reclamation and remediation -­‐ sustaining” is calculated as current period accretion related to reclamation and remediation obligations plus current period amortization of the corresponding reclamation and remediation assets, and is intended to reflect the periodic cost of reclamation and remediation for currently operating mines. Reclamation and remediation costs for development projects or closed mines are  excluded  from  this  amount  and  classified  as  non-­‐sustaining. (g) “Exploration and business development – sustaining” is calculated as “Exploration and business development” expenses as reported on the consolidated statement of operations, less non-­‐sustaining exploration expenses. Exploration expenses are classified as either sustaining or non-­‐sustaining based on a determination of the type and location of the exploration expenditure. Exploration expenditures within the footprint of operating mines are considered costs required to sustain current operations and so are included in sustaining costs. Exploration expenditures focused on new ore bodies near existing mines (i.e. brownfield), new exploration projects (i.e. greenfield) or for other generative exploration activity not linked to existing mining operations are classified as non-­‐sustaining. Business development expenses  are  considered  sustaining  costs  as  they  are  required  for  general  operations. (h)  “Additions  to  property,  plant  and  equipment  –  sustaining”  represents  the  majority  of  capital  expenditures  at  existing  operations  including   capitalized exploration costs, capitalized stripping and underground mine development costs, ongoing replacement of mine equipment and other capital facilities and other capital expenditures and is calculated as total additions to property, plant and equipment (as reported on the consolidated statements of cash flows), less capitalized interest and non-­‐sustaining capital. Non-­‐sustaining capital represents capital expenditures for major growth projects as well as enhancement capital for significant infrastructure improvements at existing operations. Non-­‐sustaining  capital  expenditures  during  the  year  ended  December  31,  2017,  primarily  relate  to  projects  at  Tasiast. (i) “Portion attributable to Chirano non-­‐controlling interest” represents the non-­‐controlling interest (10%) in the ounces sold from the Chirano  mine. (j) Average realized gold price is a non-­‐GAAP financial measure and is defined as gold metal sales divided by the total number of gold ounces sold. This measure is intended to enable Management to better understand the price realized in each reporting period. The realized price measure does not have any standardized definition under IFRS and should not be considered a substitute for measure of performance prepared  in  accordance  with  IFRS. 56 57 KINROSS ANNUAL REPORT MDA 57                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Cautionary  Statement  on  Forward-­‐Looking  Information     All  statements,  other  than  statements  of  historical  fact,  contained  or  incorporated  by  reference  in  this  MD&A  including,  but  not  limited  to,  any  information  as  to   the   future   financial   or   operating   performance   of   Kinross,   constitute   ‘‘forward-­‐looking   information’’   or   ‘‘forward-­‐looking   statements’’   within   the   meaning   of   certain  securities  laws,  including  the  provisions  of  the  Securities  Act  (Ontario)  and  the  provisions  for  ‘‘safe  harbor’’  under  the  United  States  Private  Securities   Litigation  Reform  Act  of  1995  and  are  based  on  expectations,  estimates  and  projections  as  of  the  date  of  this  MD&A.  Forward-­‐looking  statements  contained  in   this  MD&A,  include,  but  are  not  limited  to,  those  under  the  headings  (or  headings  that  include):  “Project  Updates  and  New  Developments”  and  “Outlook”  and   include,  without  limitation,  statements  with  respect  to  our  guidance  for  production,  production  costs  of  sales,  all-­‐in  sustaining  cost  and  capital  expenditures;  the   schedules  and  budgets  for  the  Company’s  development  projects;  and  continuous  improvement  initiatives,    as  well  as  references   to  other  possible  events,  the   future   price   of   gold   and   silver,     the   timing   and   amount   of   estimated   future   production,   costs   of   production,   capital   expenditures,   costs   and   timing   of   the   development   of   projects   and   new   deposits,   success   of   exploration,   development   and   mining   activities,   currency   fluctuations,   capital   requirements,   project   studies,  mine  life  extensions,  restarting  suspended  or  disrupted  operations;  continuous  improvement  initiatives;  and  resolution  of  pending  litigation.  The  words   “advance”,   “anticipate”,   “assumption”,   “believe”,   “estimates”,   ‘‘expects’’,   “forecast”,   “focus”,   “forward”,   “guidance”,   “initiative”,   “measures”,   “on   budget”,   “outlook”,   “opportunity”,   “plan”,   “potential”,   “progress”,   “project”,   “projection”,   “well   positioned”,   or   variations   of   or   similar   such   words   and   phrases   or   statements  that  certain  actions,  events  or  results  may,  could,  should  or  will  be  achieved,  received  or  taken,  or  will  occur  or  result  and  similar  such  expressions   identify  forward-­‐looking  statements.  Forward-­‐looking  statements  are  necessarily  based  upon  a  number  of  estimates  and  assumptions  that,  while  considered   reasonable   by   Kinross   as   of   the   date   of   such   statements,   are   inherently   subject   to   significant   business,   economic   and   competitive   uncertainties   and   contingencies.   The   estimates,   models   and   assumptions   of   Kinross   referenced,   contained   or   incorporated   by   reference   in   this   MD&A,   which   may   prove   to   be   incorrect,   include,   but   are   not   limited   to,   the   various   assumptions   set   forth   herein   and   in   our   most   recently   filed   Annual   Information   Form   and   our   Management’s  Discussion  and  Analysis  as  well  as:  (1)  there  being  no  significant  disruptions  affecting  the  operations  of  the  Company    whether  due  to  extreme   weather  events  (including,  without  limitation,  excessive  or  lack  of  rainfall,  in  particular,  the  potential  for  further  production  curtailments  at  Paracatu  resulting   from  insufficient  rainfall)  and  other  or  related  natural  disasters,  labour  disruptions  (including  but  not  limited  to  workforce  reductions),  supply  disruptions,  power   disruptions,  damage  to  equipment  or  otherwise;  (2)  permitting,  development,  operations  and  production  from  the  Company’s  operations  being  consistent  with   Kinross’   current   expectations   including,   without   limitation,   the   maintenance   of   existing   permits   and   approvals   and   the   timely   receipt   of   all   permits   and   authorizations   necessary   for   the   development   and   operation   of   the   Tasiast   Phase   Two   expansion   and   the   Round   Mountain   Phase   W   expansion   including,   without  limitation,  work  permits,  necessary  import  authorizations  for  goods  and  equipment  and  exploration  license  conversions  at  Tasiast;  and  land  acquisitions   and  permitting  for  the  construction  and  operation  of  the  new  tailings  facility,  water  and  power  supply  and  launch  of  the  new   tailings  reprocessing  facility  at   Paracatu;   (3)   political   and   legal   developments   in   any   jurisdiction   in   which   the   Company   operates   being   consistent   with   its   current   expectations   including,   without  limitation,  the  impact  of  any  political  tensions  and  uncertainty  in  the  Russian  Federation  and  Ukraine  or  any  related  sanctions  and  any  other  similar   restrictions  or  penalties  imposed,  or  actions  taken,  by  any  government,  including  but  not  limited  to  potential  power  rationing,  tailings  facility  regulation  and   amendments   to   mining   laws   in   Brazil,   potential   amendments   to   water   laws   and/or   other   water   use   restrictions   and   regulatory   actions   in   Chile,   potential   amendments   to   minerals   and   mining   laws,   energy   levies   laws,   and   dam   safety   regulation   in   Ghana,   potential   amendments   to   customs   and   mining   laws   (including  but  not  limited  amendments  to  the  VAT)  and  regulations  relating  to  work  permits  in  Mauritania,  the  potential  passing  of  Environmental  Protection   Agency  regulations  in  the  US  relating  to  the  provision  of  financial  assurances  under  the  Comprehensive  Environmental  Response,  Compensation  and  Liability   Act,   and   potential   amendments   to   and   enforcement   of   tax   laws   in   Russia   (including,   but   not   limited   to,   the   interpretation,   implementation,   application   and   enforcement   of   any   such   laws   and   amendments   thereto),   being   consistent   with   Kinross’   current   expectations;   (4)   the   exchange   rate   between   the   Canadian   dollar,  Brazilian  real,  Chilean  peso,  Russian  rouble,  Mauritanian  ouguiya,  Ghanaian  cedi  and  the  U.S.  dollar  being  approximately  consistent  with  current  levels;   (5)  certain  price  assumptions  for  gold  and  silver;  (6)  prices  for  diesel,  natural  gas,  fuel  oil,  electricity  and  other  key  supplies  being  approximately  consistent  with   current  levels;  (7)  production  and  cost  of  sales  forecasts  for  the  Company  meeting  expectations;  (8)  the  accuracy  of  the  current  mineral  reserve  and  mineral   resource  estimates  of  the  Company  (including  but  not  limited  to  ore  tonnage  and  ore  grade  estimates)  and  mine  plans  for  the  Company’s  mining  operations   (including  but  not  limited  to  throughput  and  recoveries  being  affected  by  metallurgical  characteristics  at  Paracatu);  (9)  labour  and  materials  costs  increasing  on   a   basis   consistent   with   Kinross’   current   expectations;   (10)   the   terms   and   conditions   of   the   legal   and   fiscal   stability   agreements   for   the   Tasiast   and   Chirano   operations  being  interpreted  and  applied  in  a  manner  consistent  with  their  intent  and  Kinross’  expectations;  (11)  goodwill  and/or  asset  impairment  potential;   (12)   the   regulatory   and   legislative   regime   regarding   mining,   electricity   production   and   transmission   (including   rules   related   to   power   tariffs)   in   Brazil   being   consistent   with   Kinross’   current   expectations;   and   (13)   access   to   capital   markets,   including   but   not   limited   to   maintaining   a   debt   rating   consistent   with   the   Company’s   current   expectations.   Known   and   unknown   factors   could   cause   actual   results   to   differ   materially   from   those   projected   in   the   forward-­‐looking   statements.  Such  factors  include,  but  are  not  limited  to:  sanctions  (any  other  similar  restrictions  or  penalties)  now  or  subsequently  imposed,  other  actions  taken,   by,   against,   in   respect   of   or   otherwise   impacting   any   jurisdiction   in   which   the   Company   is   domiciled   or   operates   (including   but   not   limited   to   the   Russian   Federation,   Canada,   the   European   Union   and   the   United   States),   or   any   government   or   citizens   of,   persons   or   companies   domiciled   in,   or   the   Company’s   business,  operations  or  other  activities  in,  any  such  jurisdiction;  fluctuations  in  the  currency  markets;  fluctuations  in  the  spot  and  forward  price  of  gold  or  certain   other  commodities  (such  as  fuel  and  electricity);  changes  in  the  discount  rates  applied  to  calculate  the  present  value  of  net  future  cash  flows  based  on  country-­‐ specific  real  weighted  average  cost  of  capital;  changes  in  the  market  valuations  of  peer  group  gold  producers  and  the  Company,  and  the  resulting  impact  on   market  price  to  net  asset  value  multiples;  changes  in  various  market  variables,  such  as  interest  rates,  foreign  exchange  rates,  gold  or  silver  prices  and  lease   rates,   or   global   fuel   prices,   that   could   impact   the   mark-­‐to-­‐market   value   of   outstanding   derivative   instruments   and   ongoing   payments/receipts   under   any   financial  obligations;  risks  arising  from  holding  derivative  instruments  (such  as  credit  risk,  market  liquidity  risk  and  mark-­‐to-­‐market  risk);  changes  in  national   and  local  government  legislation,  taxation  (including  but  not  limited  to  income  tax,  advance  income  tax,  stamp  tax,  withholding  tax,  capital  tax,  tariffs,  value-­‐ added  or  sales  tax,  capital  outflow  tax,  capital  gains  tax,  windfall  or  windfall  profits  tax,  royalty,  excise  tax,  customs/import  or  export  taxes/duties,  asset  taxes,   asset  transfer  tax,  property  use  or  other  real  estate  tax,  together  with  any  related  fine,  penalty,  surcharge,  or  interest  imposed  in  connection  with  such  taxes),   controls,  policies  and  regulations;  the  security  of  personnel  and  assets;  political  or  economic  developments  in  Canada,  the  United  States,  Chile,  Brazil,  Russia,   Mauritania,  Ghana,  or  other  countries  in  which  Kinross  does  business  or  may  carry  on  business;  business  opportunities  that  may  be  presented  to,  or  pursued  by,   us;   our   ability   to   successfully   integrate   acquisitions   and   complete   divestitures;   operating   or   technical   difficulties   in   connection   with   mining   or   development   activities;   employee   relations;   litigation   or   other   claims   against,   or   regulatory   investigations   and/or   any   enforcement   actions   or   sanctions   in   respect   of   the   Company  (and/or  its  directors,  officers,  or  employees)  including,  but  not  limited  to,  securities  class  action  litigation  in  Canada  and/or  the  United  States,  or  any   investigations,   enforcement   actions   and/or   sanctions   under   any   applicable   anti-­‐corruption,   international   sanctions   and/or   anti-­‐money   laundering   laws   and   regulations   in   Canada,   the   United   States   or   any   other   applicable   jurisdiction;   the   speculative   nature   of   gold   exploration   and   development   including,   but   not   limited  to,  the  risks  of  obtaining  necessary  licenses  and  permits;  diminishing  quantities  or  grades  of  reserves;  adverse  changes  in  our  credit  rating;  and  contests   over  title  to  properties,  particularly  title  to  undeveloped  properties.  In  addition,  there  are  risks  and  hazards  associated  with  the  business  of  gold  exploration,   development   and   mining,   including   environmental   hazards,   industrial   accidents,   unusual   or   unexpected   formations,   pressures,   cave-­‐ins,   flooding   and   gold   bullion  losses  (and  the  risk  of  inadequate  insurance,  or  the  inability  to  obtain  insurance,  to  cover  these  risks).  Many  of  these  uncertainties  and  contingencies  can   directly  or  indirectly  affect,  and  could  cause,  Kinross’  actual  results  to  differ  materially  from  those  expressed  or  implied  in  any  forward-­‐looking  statements  made   58 KINROSS ANNUAL REPORT MDA 58 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   by,  or  on  behalf  of,  Kinross,  including  but  not  limited  to  resulting  in  an  impairment  charge  on  goodwill  and/or  assets.  There  can  be  no  assurance  that  forward-­‐ looking  statements  will  prove  to  be  accurate,  as  actual  results  and  future  events  could  differ  materially  from  those  anticipated  in  such  statements.  Forward-­‐ looking  statements  are  provided  for  the  purpose  of  providing  information  about  management’s  expectations  and  plans  relating  to  the  future.  All  of  the  forward-­‐ looking   statements   made   in   this   MD&A   are   qualified   by   these   cautionary   statements   and   those   made   in   our   other   filings   with   the   securities   regulators   of   Canada   and   the   United   States   including,   but   not   limited   to,   the   cautionary   statements   made   in   the   ‘‘Risk   Factors’’   section   of   our   most   recently   filed   Annual   Information   Form.   These   factors   are   not   intended   to   represent   a   complete   list   of   the   factors   that   could   affect   Kinross.   Kinross   disclaims   any   intention   or   obligation   to   update   or   revise   any   forward-­‐looking   statements   or   to   explain   any   material   difference   between   subsequent   actual   events   and   such   forward-­‐ looking  statements,  except  to  the  extent  required  by  applicable  law.   Approximately  70%-­‐80%  of  the  Company's  costs  are  denominated  in  U.S.  dollars.     A  10%  change  in  foreign  currency  exchange  rates  would  be  expected  to  result  in  an  approximate  $17  impact  on  production  cost  of  sales  per  ounce2.   Specific  to  the  Russian  rouble,  a  10%  change  in  the  exchange  rate  would  be  expected  to  result  in  an  approximate  $19  impact  on  Russian  production  cost  of  sales   Specific  to  the  Brazilian  real,  a  10%  change  in  the  exchange  rate  would  be  expected  to  result  in  an  approximate  $38  impact  on  Brazilian  production  cost  of  sales   A  $10  per  barrel  change  in  the  price  of  oil  would  be  expected  to  result  in  an  approximate  $3  impact  on  production  cost  of  sales  per  ounce.   A  $100  change  in  the  price  of  gold  would  be  expected  to  result  in  an  approximate  $4  impact  on  production  cost  of  sales  per  ounce  as  a  result  of  a  change  in   Key  Sensitivities     per  ounce.   per  ounce.   royalties.   Other  information   may  be  applicable.   Where  we  say  ‘‘we’’,  ‘‘us’’,  ‘‘our’’,  the  ‘‘Company’’,  or  ‘‘Kinross’’  in  this  MD&A,  we  mean  Kinross  Gold  Corporation  and/or  one  or  more  or  all  of  its  subsidiaries,  as   The  technical  information  about  the  Company’s  mineral  properties  contained  in  this  MD&A  has  been  prepared  under  the  supervision  of  Mr.  John  Sims,  an  officer   of  the  Company,  who  is  a  “qualified  person”  within  the  meaning  of  National  Instrument  43-­‐101.   2 Refers   to   all   of   the   currencies   in   the   countries   where   the   Company   has   mining   operations,   fluctuating   simultaneously   by   10%   in   the   same   direction,   either   appreciating   or   depreciating,  taking  into  consideration  the  impact  of  hedging  and  the  weighting  of  each  currency  within  our  consolidated  cost  structure. 59                   KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   Cautionary  Statement  on  Forward-­‐Looking  Information     All  statements,  other  than  statements  of  historical  fact,  contained  or  incorporated  by  reference  in  this  MD&A  including,  but  not  limited  to,  any  information  as  to   the   future   financial   or   operating   performance   of   Kinross,   constitute   ‘‘forward-­‐looking   information’’   or   ‘‘forward-­‐looking   statements’’   within   the   meaning   of   certain  securities  laws,  including  the  provisions  of  the  Securities  Act  (Ontario)  and  the  provisions  for  ‘‘safe  harbor’’  under  the  United  States  Private  Securities   Litigation  Reform  Act  of  1995  and  are  based  on  expectations,  estimates  and  projections  as  of  the  date  of  this  MD&A.  Forward-­‐looking  statements  contained  in   this  MD&A,  include,  but  are  not  limited  to,  those  under  the  headings  (or  headings  that  include):  “Project  Updates  and  New  Developments”  and  “Outlook”  and   include,  without  limitation,  statements  with  respect  to  our  guidance  for  production,  production  costs  of  sales,  all-­‐in  sustaining  cost  and  capital  expenditures;  the   schedules  and  budgets  for  the  Company’s  development  projects;  and  continuous  improvement  initiatives,    as  well  as  references   to  other  possible  events,  the   future   price   of   gold   and   silver,     the   timing   and   amount   of   estimated   future   production,   costs   of   production,   capital   expenditures,   costs   and   timing   of   the   development   of   projects   and   new   deposits,   success   of   exploration,   development   and   mining   activities,   currency   fluctuations,   capital   requirements,   project   studies,  mine  life  extensions,  restarting  suspended  or  disrupted  operations;  continuous  improvement  initiatives;  and  resolution  of  pending  litigation.  The  words   “advance”,   “anticipate”,   “assumption”,   “believe”,   “estimates”,   ‘‘expects’’,   “forecast”,   “focus”,   “forward”,   “guidance”,   “initiative”,   “measures”,   “on   budget”,   “outlook”,   “opportunity”,   “plan”,   “potential”,   “progress”,   “project”,   “projection”,   “well   positioned”,   or   variations   of   or   similar   such   words   and   phrases   or   statements  that  certain  actions,  events  or  results  may,  could,  should  or  will  be  achieved,  received  or  taken,  or  will  occur  or  result  and  similar  such  expressions   identify  forward-­‐looking  statements.  Forward-­‐looking  statements  are  necessarily  based  upon  a  number  of  estimates  and  assumptions  that,  while  considered   reasonable   by   Kinross   as   of   the   date   of   such   statements,   are   inherently   subject   to   significant   business,   economic   and   competitive   uncertainties   and   contingencies.   The   estimates,   models   and   assumptions   of   Kinross   referenced,   contained   or   incorporated   by   reference   in   this   MD&A,   which   may   prove   to   be   incorrect,   include,   but   are   not   limited   to,   the   various   assumptions   set   forth   herein   and   in   our   most   recently   filed   Annual   Information   Form   and   our   Management’s  Discussion  and  Analysis  as  well  as:  (1)  there  being  no  significant  disruptions  affecting  the  operations  of  the  Company    whether  due  to  extreme   weather  events  (including,  without  limitation,  excessive  or  lack  of  rainfall,  in  particular,  the  potential  for  further  production  curtailments  at  Paracatu  resulting   from  insufficient  rainfall)  and  other  or  related  natural  disasters,  labour  disruptions  (including  but  not  limited  to  workforce  reductions),  supply  disruptions,  power   disruptions,  damage  to  equipment  or  otherwise;  (2)  permitting,  development,  operations  and  production  from  the  Company’s  operations  being  consistent  with   Kinross’   current   expectations   including,   without   limitation,   the   maintenance   of   existing   permits   and   approvals   and   the   timely   receipt   of   all   permits   and   authorizations   necessary   for   the   development   and   operation   of   the   Tasiast   Phase   Two   expansion   and   the   Round   Mountain   Phase   W   expansion   including,   without  limitation,  work  permits,  necessary  import  authorizations  for  goods  and  equipment  and  exploration  license  conversions  at  Tasiast;  and  land  acquisitions   and  permitting  for  the  construction  and  operation  of  the  new  tailings  facility,  water  and  power  supply  and  launch  of  the  new   tailings  reprocessing  facility  at   Paracatu;   (3)   political   and   legal   developments   in   any   jurisdiction   in   which   the   Company   operates   being   consistent   with   its   current   expectations   including,   without  limitation,  the  impact  of  any  political  tensions  and  uncertainty  in  the  Russian  Federation  and  Ukraine  or  any  related  sanctions  and  any  other  similar   restrictions  or  penalties  imposed,  or  actions  taken,  by  any  government,  including  but  not  limited  to  potential  power  rationing,  tailings  facility  regulation  and   amendments   to   mining   laws   in   Brazil,   potential   amendments   to   water   laws   and/or   other   water   use   restrictions   and   regulatory   actions   in   Chile,   potential   amendments   to   minerals   and   mining   laws,   energy   levies   laws,   and   dam   safety   regulation   in   Ghana,   potential   amendments   to   customs   and   mining   laws   (including  but  not  limited  amendments  to  the  VAT)  and  regulations  relating  to  work  permits  in  Mauritania,  the  potential  passing  of  Environmental  Protection   Agency  regulations  in  the  US  relating  to  the  provision  of  financial  assurances  under  the  Comprehensive  Environmental  Response,  Compensation  and  Liability   Act,   and   potential   amendments   to   and   enforcement   of   tax   laws   in   Russia   (including,   but   not   limited   to,   the   interpretation,   implementation,   application   and   enforcement   of   any   such   laws   and   amendments   thereto),   being   consistent   with   Kinross’   current   expectations;   (4)   the   exchange   rate   between   the   Canadian   dollar,  Brazilian  real,  Chilean  peso,  Russian  rouble,  Mauritanian  ouguiya,  Ghanaian  cedi  and  the  U.S.  dollar  being  approximately  consistent  with  current  levels;   (5)  certain  price  assumptions  for  gold  and  silver;  (6)  prices  for  diesel,  natural  gas,  fuel  oil,  electricity  and  other  key  supplies  being  approximately  consistent  with   current  levels;  (7)  production  and  cost  of  sales  forecasts  for  the  Company  meeting  expectations;  (8)  the  accuracy  of  the  current  mineral  reserve  and  mineral   resource  estimates  of  the  Company  (including  but  not  limited  to  ore  tonnage  and  ore  grade  estimates)  and  mine  plans  for  the  Company’s  mining  operations   (including  but  not  limited  to  throughput  and  recoveries  being  affected  by  metallurgical  characteristics  at  Paracatu);  (9)  labour  and  materials  costs  increasing  on   a   basis   consistent   with   Kinross’   current   expectations;   (10)   the   terms   and   conditions   of   the   legal   and   fiscal   stability   agreements   for   the   Tasiast   and   Chirano   operations  being  interpreted  and  applied  in  a  manner  consistent  with  their  intent  and  Kinross’  expectations;  (11)  goodwill  and/or  asset  impairment  potential;   (12)   the   regulatory   and   legislative   regime   regarding   mining,   electricity   production   and   transmission   (including   rules   related   to   power   tariffs)   in   Brazil   being   consistent   with   Kinross’   current   expectations;   and   (13)   access   to   capital   markets,   including   but   not   limited   to   maintaining   a   debt   rating   consistent   with   the   Company’s   current   expectations.   Known   and   unknown   factors   could   cause   actual   results   to   differ   materially   from   those   projected   in   the   forward-­‐looking   statements.  Such  factors  include,  but  are  not  limited  to:  sanctions  (any  other  similar  restrictions  or  penalties)  now  or  subsequently  imposed,  other  actions  taken,   by,   against,   in   respect   of   or   otherwise   impacting   any   jurisdiction   in   which   the   Company   is   domiciled   or   operates   (including   but   not   limited   to   the   Russian   Federation,   Canada,   the   European   Union   and   the   United   States),   or   any   government   or   citizens   of,   persons   or   companies   domiciled   in,   or   the   Company’s   business,  operations  or  other  activities  in,  any  such  jurisdiction;  fluctuations  in  the  currency  markets;  fluctuations  in  the  spot  and  forward  price  of  gold  or  certain   other  commodities  (such  as  fuel  and  electricity);  changes  in  the  discount  rates  applied  to  calculate  the  present  value  of  net  future  cash  flows  based  on  country-­‐ specific  real  weighted  average  cost  of  capital;  changes  in  the  market  valuations  of  peer  group  gold  producers  and  the  Company,  and  the  resulting  impact  on   market  price  to  net  asset  value  multiples;  changes  in  various  market  variables,  such  as  interest  rates,  foreign  exchange  rates,  gold  or  silver  prices  and  lease   rates,   or   global   fuel   prices,   that   could   impact   the   mark-­‐to-­‐market   value   of   outstanding   derivative   instruments   and   ongoing   payments/receipts   under   any   financial  obligations;  risks  arising  from  holding  derivative  instruments  (such  as  credit  risk,  market  liquidity  risk  and  mark-­‐to-­‐market  risk);  changes  in  national   and  local  government  legislation,  taxation  (including  but  not  limited  to  income  tax,  advance  income  tax,  stamp  tax,  withholding  tax,  capital  tax,  tariffs,  value-­‐ added  or  sales  tax,  capital  outflow  tax,  capital  gains  tax,  windfall  or  windfall  profits  tax,  royalty,  excise  tax,  customs/import  or  export  taxes/duties,  asset  taxes,   asset  transfer  tax,  property  use  or  other  real  estate  tax,  together  with  any  related  fine,  penalty,  surcharge,  or  interest  imposed  in  connection  with  such  taxes),   controls,  policies  and  regulations;  the  security  of  personnel  and  assets;  political  or  economic  developments  in  Canada,  the  United  States,  Chile,  Brazil,  Russia,   Mauritania,  Ghana,  or  other  countries  in  which  Kinross  does  business  or  may  carry  on  business;  business  opportunities  that  may  be  presented  to,  or  pursued  by,   us;   our   ability   to   successfully   integrate   acquisitions   and   complete   divestitures;   operating   or   technical   difficulties   in   connection   with   mining   or   development   activities;   employee   relations;   litigation   or   other   claims   against,   or   regulatory   investigations   and/or   any   enforcement   actions   or   sanctions   in   respect   of   the   Company  (and/or  its  directors,  officers,  or  employees)  including,  but  not  limited  to,  securities  class  action  litigation  in  Canada  and/or  the  United  States,  or  any   investigations,   enforcement   actions   and/or   sanctions   under   any   applicable   anti-­‐corruption,   international   sanctions   and/or   anti-­‐money   laundering   laws   and   regulations   in   Canada,   the   United   States   or   any   other   applicable   jurisdiction;   the   speculative   nature   of   gold   exploration   and   development   including,   but   not   limited  to,  the  risks  of  obtaining  necessary  licenses  and  permits;  diminishing  quantities  or  grades  of  reserves;  adverse  changes  in  our  credit  rating;  and  contests   over  title  to  properties,  particularly  title  to  undeveloped  properties.  In  addition,  there  are  risks  and  hazards  associated  with  the  business  of  gold  exploration,   development   and   mining,   including   environmental   hazards,   industrial   accidents,   unusual   or   unexpected   formations,   pressures,   cave-­‐ins,   flooding   and   gold   bullion  losses  (and  the  risk  of  inadequate  insurance,  or  the  inability  to  obtain  insurance,  to  cover  these  risks).  Many  of  these  uncertainties  and  contingencies  can   directly  or  indirectly  affect,  and  could  cause,  Kinross’  actual  results  to  differ  materially  from  those  expressed  or  implied  in  any  forward-­‐looking  statements  made   58 KINROSS  GOLD  CORPORATION   MANAGEMENT’S  DISCUSSION  AND  ANALYSIS     For  the  year  ended  December  31,  2017   by,  or  on  behalf  of,  Kinross,  including  but  not  limited  to  resulting  in  an  impairment  charge  on  goodwill  and/or  assets.  There  can  be  no  assurance  that  forward-­‐ looking  statements  will  prove  to  be  accurate,  as  actual  results  and  future  events  could  differ  materially  from  those  anticipated  in  such  statements.  Forward-­‐ looking  statements  are  provided  for  the  purpose  of  providing  information  about  management’s  expectations  and  plans  relating  to  the  future.  All  of  the  forward-­‐ looking   statements   made   in   this   MD&A   are   qualified   by   these   cautionary   statements   and   those   made   in   our   other   filings   with   the   securities   regulators   of   Canada   and   the   United   States   including,   but   not   limited   to,   the   cautionary   statements   made   in   the   ‘‘Risk   Factors’’   section   of   our   most   recently   filed   Annual   Information   Form.   These   factors   are   not   intended   to   represent   a   complete   list   of   the   factors   that   could   affect   Kinross.   Kinross   disclaims   any   intention   or   obligation   to   update   or   revise   any   forward-­‐looking   statements   or   to   explain   any   material   difference   between   subsequent   actual   events   and   such   forward-­‐ looking  statements,  except  to  the  extent  required  by  applicable  law.   Key  Sensitivities     Approximately  70%-­‐80%  of  the  Company's  costs  are  denominated  in  U.S.  dollars.     A  10%  change  in  foreign  currency  exchange  rates  would  be  expected  to  result  in  an  approximate  $17  impact  on  production  cost  of  sales  per  ounce2.   Specific  to  the  Russian  rouble,  a  10%  change  in  the  exchange  rate  would  be  expected  to  result  in  an  approximate  $19  impact  on  Russian  production  cost  of  sales   per  ounce.   Specific  to  the  Brazilian  real,  a  10%  change  in  the  exchange  rate  would  be  expected  to  result  in  an  approximate  $38  impact  on  Brazilian  production  cost  of  sales   per  ounce.   A  $10  per  barrel  change  in  the  price  of  oil  would  be  expected  to  result  in  an  approximate  $3  impact  on  production  cost  of  sales  per  ounce.   A  $100  change  in  the  price  of  gold  would  be  expected  to  result  in  an  approximate  $4  impact  on  production  cost  of  sales  per  ounce  as  a  result  of  a  change  in   royalties.   Other  information   Where  we  say  ‘‘we’’,  ‘‘us’’,  ‘‘our’’,  the  ‘‘Company’’,  or  ‘‘Kinross’’  in  this  MD&A,  we  mean  Kinross  Gold  Corporation  and/or  one  or  more  or  all  of  its  subsidiaries,  as   may  be  applicable.   The  technical  information  about  the  Company’s  mineral  properties  contained  in  this  MD&A  has  been  prepared  under  the  supervision  of  Mr.  John  Sims,  an  officer   of  the  Company,  who  is  a  “qualified  person”  within  the  meaning  of  National  Instrument  43-­‐101.   2 Refers   to   all   of   the   currencies   in   the   countries   where   the   Company   has   mining   operations,   fluctuating   simultaneously   by   10%   in   the   same   direction,   either   appreciating   or   depreciating,  taking  into  consideration  the  impact  of  hedging  and  the  weighting  of  each  currency  within  our  consolidated  cost  structure. 59 KINROSS ANNUAL REPORT MDA 59                   KINROSS  GOLD  CORPORATION MANAGEMENT’S  RESPONSIBILITY  FOR     FINANCIAL  STATEMENTS   The consolidated financial statements, the notes thereto, and other financial information contained in the Management’s Discussion and Analysis have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board and are the responsibility of the management of Kinross Gold Corporation. The financial information presented elsewhere in the Management’s Discussion and Analysis is consistent with the data that is contained in the consolidated financial statements. The consolidated financial statements, where necessary, include amounts which are based on the best estimates and judgment of management. In order to discharge management’s responsibility for the integrity of the financial statements, the Company maintains a system of internal accounting controls. These controls are designed to provide reasonable assurance that the Company’s assets are safeguarded, transactions are executed and recorded in accordance with management’s authorization, proper records are maintained and relevant and reliable financial information is produced. These controls include maintaining quality standards in hiring and training of employees, policies and procedures manuals, a corporate code of conduct and ensuring that there is proper accountability for performance within appropriate and well-defined areas of responsibility. The system of internal controls is further supported by a compliance function, which is designed to ensure that we and our employees comply with securities legislation and conflict of interest rules. The Board of Directors is responsible for overseeing management’s performance of its responsibilities for financial reporting and internal control. The Audit Committee, which is composed of non-executive directors, meets with management as well as the external auditors to ensure that management is properly fulfilling its financial reporting responsibilities to the Directors who approve the consolidated financial statements. The external auditors have full and unrestricted access to the Audit Committee to discuss the scope of their audits, the adequacy of the system of internal controls and review financial reporting issues. The consolidated financial statements have been audited by KPMG LLP, the independent registered public accounting firm, in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States).      J.    PAUL  ROLLINSON   President and Chief Executive Officer Toronto, Canada February 14, 2018 TONY  S.    GIARDINI   Executive Vice-President and Chief Financial Officer Toronto, Canada February 14, 2018 KINROSS ANNUAL REPORT 2017 FS 1                                                                                                                                   MANAGEMENT’S  REPORT  ON     INTERNAL  CONTROL  OVER  FINANCIAL  REPORTING   The management of Kinross Gold Corporation (“Kinross”) is responsible for establishing and maintaining adequate internal control over financial reporting, and have designed such internal control over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. Management has used the Internal Control—Integrated Framework (2013) to evaluate the effectiveness of internal control over financial reporting, which is a recognized and suitable framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management has evaluated the design and operation of Kinross’ internal control over financial reporting as of December 31, 2017, and has concluded that such internal control over financial reporting is effective. The effectiveness of Kinross’ internal control over financial reporting as of December 31, 2017 has been audited by KPMG LLP, Chartered Professional Accountants, as stated in their report that appears therein.      J.    PAUL  ROLLINSON   President and Chief Executive Officer Toronto, Canada February 14, 2018 TONY  S.    GIARDINI   Executive Vice-President and Chief Financial Officer Toronto, Canada February 14, 2018 KINROSS ANNUAL REPORT 2017 FS 2         REPORT  OF  INDEPENDENT  REGISTERED  PUBLIC  ACCOUNTING  FIRM   To the Shareholders and Board of Directors of Kinross Gold Corporation Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated financial statements of Kinross Gold Corporation (the “Entity”), which comprise the consolidated balance sheets as at December 31, 2017 and December 31, 2016, the consolidated statements of operations, comprehensive income (loss), cash flows and equity for the years then ended, and the related notes, comprising a summary of significant accounting policies and other explanatory information (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Entity as at December 31, 2017 and December 31, 2016, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. Report on Internal Control Over Financial Reporting We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Entity’s internal control over financial reporting as of December 31, 2017, based on the criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 14, 2018 expressed an unqualified (unmodified) opinion on the effectiveness of the Entity’s internal control over financial reporting. Basis for Opinion A - Management’s Responsibility for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. B - Auditors’ Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement, whether due to error or fraud. Those standards also require that we comply with ethical requirements, including independence. We are required to be independent with respect to the Entity in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada, the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We are a public accounting firm registered with the PCAOB. An audit includes performing procedures to assess the risks of material misstatements of the consolidated financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included obtaining and examining, on a test basis, audit evidence regarding the amounts and disclosures in the consolidated financial statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies and principles used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a reasonable basis for our audit opinion. Chartered Professional Accountants, Licensed Public Accountants We have served as the Entity's auditor since 2005. Toronto, Canada February 14, 2018 KINROSS ANNUAL REPORT 2017 FS 3               REPORT  OF  INDEPENDENT  REGISTERED  PUBLIC  ACCOUNTING  FIRM   To the Shareholders and the Board of Directors of Kinross Gold Corporation Opinion on Internal Control Over Financial Reporting We have audited Kinross Gold Corporation’s (the “Company”) internal control over financial reporting as of December 31, 2017, based on the criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on the criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Report on the Consolidated Financial Statements We also have audited, in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated financial statements of the Company, which comprise the consolidated balance sheets as at December 31, 2017 and December 31, 2016, the consolidated statements of operations, comprehensive income (loss), cash flows and equity for the years then ended, and the related notes, comprising a summary of significant accounting policies and other explanatory information (collectively referred to as the “consolidated financial statements”), and our report dated February 14, 2018 expressed an unqualified opinion on those consolidated financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying management’s report on internal control over financial reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB and in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Chartered Professional Accountants, Licensed Public Accountants Toronto, Canada February 14, 2018 KINROSS ANNUAL REPORT 2017 FS 4   KINROSS  GOLD  CORPORATION CONSOLIDATED  BALANCE  SHEETS (expressed  in  millions  of  United  States  dollars,  except  share  amounts)   Assets Current  assets Cash  and  cash  equivalents Restricted  cash Accounts  receivable  and  other  assets Current  income  tax  recoverable Inventories   Unrealized  fair  value  of  derivative  assets Non-­‐current  assets   Property,  plant  and  equipment   Goodwill Long-­‐term  investments   Investments  in  associate  and  joint  ventures Unrealized  fair  value  of  derivative  assets   Other  long-­‐term  assets   Deferred  tax  assets Total  assets Liabilities Current  liabilities Accounts  payable  and  accrued  liabilities Current  income  tax  payable Current  portion  of  provisions Current  portion  of  unrealized  fair  value  of  derivative  liabilities      Non-­‐current  liabilities      Long-­‐term  debt        Provisions      Other  long-­‐term  liabilities      Deferred  tax  liabilities Total  liabilities Equity      Common  shareholders'  equity Common  share  capital   Contributed  surplus Accumulated  deficit Accumulated  other  comprehensive  income Total  common  shareholders'  equity      Non-­‐controlling  interest Total  equity Commitments  and  contingencies Subsequent  events Total  liabilities  and  equity Common  shares   Authorized Issued  and  outstanding As  at December  31, 2017 December  31, 2016 $                         1,025.8 12.1 91.3 43.9 1,094.3 17.0 2,284.4 $                                 827.0 11.6 127.3 111.9 986.8 16.1 2,080.7 4,887.2 162.7 188.0 23.7 3.9 574.0 33.3 8,157.2 $                         4,917.6 162.7 142.9 163.6 6.0 411.3 94.5 7,979.3 $                         $                               482.6 35.1 66.5 1.1 585.3 $                                 464.8 72.6 93.2 7.1 637.7 1,732.6 830.5 134.0 255.6 3,538.0 1,733.2 861.2 172.2 390.7 3,795.0 $                     14,902.5 240.7 (10,580.7) 21.1 4,583.6 35.6 4,619.2 $                     14,894.2 238.3 (11,026.1) 39.1 4,145.5 38.8 4,184.3 $                         8,157.2 $                         7,979.3 Note  7 Note  7 Note  7 Note  7 Note  10 Note  7 Note  7 Note  7 Note  9 Note  10 Note  7 Note  17 Note  7 Note  13 Note  10 Note  12 Note  13 Note  17 Note  14 Note  7 Note  19 Note  6 Note  14 Unlimited 1,247,003,940 Unlimited 1,245,049,712 The  accompanying  notes  are  an  integral  part  of  these  consolidated  financial  statements.   Signed  on  behalf  of  the  Board:         John  A.    Brough                                                                                                                          Una  M.  Power   Director                                                                                                                                                      Director                                                                                                                                     KINROSS ANNUAL REPORT 2017 FS 5                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             CONSOLIDATED  STATEMENTS  OF  OPERATIONS   (expressed  in  millions  of  United  States  dollars,  except  share  and  per  share  amounts)   Revenue Metal  sales Cost  of  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment,  net  of  reversals Total  cost  of  sales Gross  profit Other  operating  expense Exploration  and  business  development   General  and  administrative   Operating  earnings Other  income  (expense)  -­‐  net Equity  in  losses  of  associate  and  joint  ventures Finance  income Finance  expense Earnings  (loss)  before  tax Income  tax  recovery  (expense)  -­‐  net Net  earnings  (loss) Net  earnings  (loss)  attributable  to:    Non-­‐controlling  interest    Common  shareholders Earnings  (loss)  per  share  attributable  to  common  shareholders Basic Diluted Weighted  average  number  of  common  shares  outstanding (millions) Basic Diluted The  accompanying  notes  are  an  integral  part  of  these  consolidated  financial  statements.     Years  ended December  31, December  31, 2017 2016 $                       3,303.0 $                         3,472.0 1,757.4 819.4 21.5 2,598.3 704.7 129.6 106.0 132.6 336.5 188.1 (1.3) 13.5 (117.8) 419.0 23.2 1,983.8 855.0 139.6 2,978.4 493.6 209.3 94.3 143.7 46.3 22.5 (1.2) 7.5 (134.6) (59.5) (49.6) $                               442.2 $                             (109.1) $                                     (3.2) $                                     (5.1) $                               445.4 $                             (104.0) $                                   $                                   0.36 0.35 $                                 $                                 (0.08) (0.08) 1,246.6 1,257.0                            1,227.0                              1,227.0   Note  8 Note  7 Note  7 Note  9 Note  7 Note  17 Note  16 KINROSS ANNUAL REPORT 2017 FS 6                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     KINROSS  GOLD  CORPORATION CONSOLIDATED  STATEMENTS  OF  COMPREHENSIVE  INCOME  (LOSS)   (expressed  in  millions  of  United  States  dollars)   Years  ended December  31, December  31, 2017 2016 Net  earnings  (loss) $                                         442.2 $                                       (109.1) Other  comprehensive  income  (loss),  net  of  tax: Items  to  be  reclassified  to  profit  or  loss  in  subsequent  periods: Note  7 Changes  in  fair  value  of  investments  (a) Accumulated  other  comprehensive  loss  related  to  investments  sold  (b) Changes  in  fair  value  of  derivative  financial  instruments  designated  as  cash   flow  hedges  (c)   Accumulated  other  comprehensive  loss  related  to  derivatives  settled   (d) (13.6) (3.1) 11.9 (13.2) (18.0) 50.8 (8.5) 29.2 (1.1) 70.4 Total  comprehensive  income  (loss) $                                         424.2 $                                           (38.7) Attributable  to  non-­‐controlling  interest Attributable  to  common  shareholders (a) Net  of  tax  of  $0.3  million  (2016  -­‐  $nil).   (b) Net  of  tax  of  $nil  (2016  -­‐  $nil).   (c) Net  of  tax  of  $4.8  million  (2016  -­‐  $10.6  million).   (d) Net  of  tax  of  $(5.9)  million  (2016  -­‐  $(1.1)  million).   The  accompanying  notes  are  an  integral  part  of  these  consolidated  financial  statements.   $                                               (3.2) $                                               (5.1) $                                         427.4 $                                           (33.6) KINROSS ANNUAL REPORT 2017 FS 7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           CONSOLIDATED  STATEMENTS  OF  CASH  FLOWS   (expressed  in  millions  of  United  States  dollars)   Net  inflow  (outflow)  of  cash  related  to  the  following  activities: Operating: Net  earnings  (loss) Adjustments  to  reconcile  net  earnings  (loss)  to  net  cash  provided  from   operating  activities: Depreciation,  depletion  and  amortization Gain  on  disposition  of  associate  and  other  interests  -­‐  net Impairment,  net  of  reversals Equity  in  losses  of  associate  and  joint  ventures Share-­‐based  compensation  expense Finance  expense Deferred  tax  recovery Foreign  exchange  losses  (gains)  and  other Reclamation  expense Changes  in  operating  assets  and  liabilities: Accounts  receivable  and  other  assets Inventories Accounts  payable  and  accrued  liabilities Cash  flow  provided  from  operating  activities Income  taxes  paid Net  cash  flow  provided  from  operating  activities Investing: Additions  to  property,  plant  and  equipment Business  acquisition Net  additions  to  long-­‐term  investments  and  other  assets Net  proceeds  from  the  sale  of  property,  plant  and  equipment Net  proceeds  from  disposition  of  associate  and  other  interests Increase  in  restricted  cash Interest  received  and  other Net  cash  flow  used  in  investing  activities Financing: Issuance  of  common  shares  on  exercise  of  options   Net  proceeds  from  issuance  of  equity Net  proceeds  from  issuance  of  debt Repayment  of  debt Interest  paid Other Net  cash  flow  used  in  financing  activities Effect  of  exchange  rate  changes  on  cash  and  cash  equivalents Increase  (decrease)  in  cash  and  cash  equivalents Cash  and  cash  equivalents,  beginning  of  period Cash  and  cash  equivalents,  end  of  period The  accompanying  notes  are  an  integral  part  of  these  consolidated  financial  statements.   Years  ended December  31, December  31, 2017 2016 $                                 442.2 $                               (109.1) 819.4 (55.2) (75.5) 1.3 13.6 117.8 (76.4) (31.9) 11.4 108.6 (86.7) (48.5) 1,140.1 (188.5) 951.6 (897.6) -­‐ (73.8) 8.5 269.6 (0.5) 6.6 (687.2) 0.8 -­‐ 494.7 (500.0) (62.9) (1.6) (69.0) 3.4 198.8 827.0 855.0 -­‐ 139.6 1.2 13.5 134.6 (149.7) 14.4 27.2 (21.2) 79.5 239.9 1,224.9 (125.7) 1,099.2 (633.8) (588.0) (59.8) 9.1 -­‐ (1.1) 3.5 (1,270.1) 2.8 275.7 175.0 (425.0) (73.5) (3.3) (48.3) 2.3 (216.9) 1,043.9  $                        1,025.8    $                                827.0   KINROSS ANNUAL REPORT 2017 FS 8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         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 the  period Accumulated  deficit Balance  at  the  beginning  of  the  period Net  earnings  (loss)  attributable  to  common  shareholders Balance  at  the  end  of  the  period Accumulated  other  comprehensive  income  (loss) Balance  at  the  beginning  of  the  period Other  comprehensive  income  (loss) Balance  at  the  end  of  the  period Years  ended December  31, 2017 December  31, 2016 $                           $                             14,894.2 -­‐ 7.2 1.1 14,902.5 14,603.5 275.7 12.2 2.8 14,894.2 $                           $                             $                                       238.3                                13.6   (11.2) $                                       239.2 14.2 (15.1) $                                       240.7 $                                       238.3 $                         $                         (11,026.1) 445.4 (10,580.7) (10,922.1) (104.0) (11,026.1) $                         $                         $                                           39.1 (18.0) $                                         (31.3) 70.4 $                                           21.1 $                                           39.1 Total  accumulated  deficit  and  accumulated  other  comprehensive  income  (loss) $                         (10,559.6) $                         (10,987.0) Total  common  shareholders'  equity $                                 4,583.6 $                                 4,145.5 Non-­‐controlling  interest Balance  at  the  beginning  of  the  period Net  loss  attributable  to  non-­‐controlling  interest Balance  at  the  end  of  the  period Total  equity $                                           38.8 $                                           43.9 (3.2) (5.1) $                                           35.6 $                                           38.8 $                                 4,619.2 $                                 4,184.3 The  accompanying  notes  are  an  integral  part  of  these  consolidated  financial  statements.   KINROSS ANNUAL REPORT 2017 FS 9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   1. DESCRIPTION  OF  BUSINESS  AND  NATURE  OF  OPERATIONS   Kinross   Gold   Corporation   and   its   subsidiaries   and   joint   arrangements   (collectively,   "Kinross"   or   the   "Company")   are   engaged  in  gold  mining  and  related  activities,  including  exploration  and  acquisition  of  gold-­‐bearing  properties,  extraction   and  processing  of  gold-­‐containing  ore  and  reclamation  of  gold  mining  properties.    Kinross  Gold  Corporation,  the  ultimate   parent,  is  a  public  company  incorporated  and  domiciled  in  Canada  with  its  registered  office  at  25  York  Street,  17th  floor,   Toronto,   Ontario,   Canada,   M5J   2V5.     Kinross'   gold   production   and   exploration   activities   are   carried   out   principally   in   Canada,  the  United  States,  the  Russian  Federation,  Brazil,  Chile,  Ghana  and  Mauritania.    Gold  is  produced  in  the  form  of   doré,  which  is  shipped  to  refineries  for  final  processing.    Kinross  also  produces  and  sells  a  quantity  of  silver.    The  Company   is  listed  on  the  Toronto  Stock  Exchange  and  the  New  York  Stock  Exchange.       The  consolidated  financial  statements  of  the  Company  for  the  year  ended  December  31,  2017  were  authorized  for  issue  in   accordance  with  a  resolution  of  the  board  of  directors  on  February  14,  2018.   2. BASIS  OF  PRESENTATION   These   consolidated   financial   statements   for   the   year   ended   December   31,   2017   (“financial   statements”)   have   been   prepared  in  accordance  with  International  Financial  Reporting  Standards  (“IFRS”)  as  issued  by  the  International  Accounting   Standards  Board  (“IASB”).       These   financial   statements   were   prepared   on   a   going   concern   basis   under   the   historical   cost   method   except   for   certain   financial  assets  and  liabilities  which  are  measured  at  fair  value.    The  significant  accounting  policies  are  presented  in  Note  3   and   have   been   consistently   applied   in   each   of   the   periods   presented.     Significant   accounting   estimates,   judgments   and   assumptions  used  or  exercised  by  management  in  the  preparation  of  these  financial  statements  are  presented  in  Note  5.   KINROSS ANNUAL REPORT 2017 FS 10               NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   3. SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES   i.    Principles  of  consolidation   The  significant  mining  properties  and  entities  of  Kinross  are  listed  below.    All  operating  activities  involve  gold  mining  and   exploration.    Each  of  the  significant  entities  has  a  December  31  year  end.       Entity Subsidiaries: (Consolidated)      Fairbanks  Gold  Mining,  Inc.      Kinross  Brasil  Mineração  S.A.  ("KBM")      Compania  Minera  Maricunga      Compania  Minera  Mantos  de  Oro Property/  Segment Location 2017 2016 As  at December  31, December  31, Fort  Knox Paracatu Maricunga  and  Lobo  Marte  /   Maricunga  and  Corporate   and  Other La  Coipa  /  Corporate  and   Other USA Brazil Chile 100% 100% 100% 100% 100% 100% Chile 100% 100%      Echo  Bay  Minerals  Company      Chukotka  Mining  and  Geological                                                              Company      Northern  Gold  LLC Kettle  River  -­‐  Buckhorn Kupol Dvoinoye/  Kupol      Selene  Holdings  LP  (b)      Tasiast  Mauritanie  Ltd.  S.A.      Chirano  Gold  Mines  Ltd.  (Ghana)  (a)      KG  Mining  (Bald  Mountain)  Inc.      Round  Mountain  Gold  Corporation  /        KG  Mining  (Round  Mountain)  Inc.   Investment  in  associate: (Equity  accounted)      Compania  Minera  Casale  (c) Interest  in  joint  ventures: (Equity  accounted)      Sociedad  Contractual  Minera  Puren      Bald  Mountain  Exploration  LLC USA Russian   Federation Russian   Federation Canada Mauritania Ghana USA USA 100% 100% 100% -­‐  (b) 100% 90% 100% 100% 100% 100% 100% 100% 100% 90% 100% 100% White  Gold/  Corporate  and   Other Tasiast Chirano Bald  Mountain Round  Mountain   Cerro  Casale/  Corporate  and   Other Chile -­‐  (c) 25% Puren/  Corporate  and  Other Bald  Mountain  Exploration   Joint  Venture/  Bald   Mountain Chile USA 65% 50% 65% 50% (a) The  Company  holds  a  90%  interest  in  the  Chirano  Gold  Mine  with  the  Government  of  Ghana  having  the  right  to  the  remaining  10%   interest.       (b) On  June  14,  2017,  the  Company  completed  the  sale  of  its  interest  in  Selene  Holdings  LP  and  the  White  Gold  exploration  project  in  the   Yukon  Territory  to  White  Gold  Corp.    See  Note  6  ii.   (c) On  June  9,  2017,  the  Company  completed  the  sale  of  its  interest  in  Compania  Minera  Casale  and  the  Cerro  Casale  project  in  Chile  to   Goldcorp  Inc.    See  Note  6  i.   KINROSS ANNUAL REPORT 2017 FS 11         NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   (a) Subsidiaries   Subsidiaries  are  entities  controlled  by  the  Company.    Control  exists  when  an  investor  is  exposed,  or  has  rights,  to  variable   returns   from   its   involvement   with   an   investee   and   has   the   ability   to   affect   those   returns   through   its   power   over   the   investee.    Subsidiaries  are  included  in  the  consolidated  financial  statements  from  the  date  control  is  obtained  until  the  date   control  ceases.    Where  the  Company’s  interest  in  a  subsidiary  is  less  than  100%,  the  Company  recognizes  non-­‐controlling   interests.     All   intercompany   balances,   transactions,   income,   expenses,   profits   and   losses,   including   unrealized   gains   and   losses  have  been  eliminated  on  consolidation.   (b) Joint  Arrangements   The  Company  conducts  a  portion  of  its  business  through  joint  arrangements  where  the  parties  are  bound  by  contractual   arrangements  establishing  joint  control  and  requiring  unanimous  consent  of  each  of  the  parties  regarding  those  activities   that   significantly   affect   the   returns   of   the   arrangement.     The   Company’s   interest   in   a   joint   arrangement   is   classified   as   either  a  joint  operation  or  a  joint  venture  depending  on  its  rights  and  obligations  in  the  arrangement.    In  a  joint  operation,   the  Company  has  rights  to  its  share  of  the  assets,  and  obligations  for  its  share  of  the  liabilities,  of  the  joint  arrangement,   while   in   a   joint   venture,   the   Company   has   rights   to   its   share   of   the   net   assets   of   the   joint   arrangement.     For   a   joint   operation,  the  Company  recognizes  in  the  consolidated  financial  statements,  its  share  of  the  assets,  liabilities,  revenue,  and   expenses   of   the   joint   arrangement,   while   for   a   joint   venture,   the   Company   recognizes   its   investment   in   the   joint   arrangement  using  the  equity  method  of  accounting  in  the  consolidated  financial  statements.       (c) Associates   Associates   are   entities,   including   unincorporated   entities   such   as   partnerships,   over   which   the   Company   has   significant   influence   and   that   are   neither   subsidiaries   nor   interests   in   joint   arrangements.     Significant   influence   is   the   ability   to   participate  in  the  financial  and  operating  policy  decisions  of  the  investee  without  having  control  or  joint  control  over  those   policies.     In   general,   significant   influence   is   presumed   to   exist   when   the   Company   has   between   20%   and   50%   of   voting   power.     Significant   influence   may   also   be   evidenced   by   factors   such   as   the   Company’s   representation   on   the   board   of   directors,  participation  in  policy-­‐making  of  the  investee,  material  transactions  with  the  investee,  interchange  of  managerial   personnel,  or  the  provision  of  essential  technical  information.    Associates  are  equity  accounted  for  from  the  effective  date   of  commencement  of  significant  influence  to  the  date  that  the  Company  ceases  to  have  significant  influence.   Results  of  associates  are  equity  accounted  for  using  the  results  of  their  most  recent  annual  financial  statements  or  interim   financial   statements,  as  applicable.    Losses  from  associates  are  recognized  in  the  consolidated  financial  statements  until   the  interest  in  the  associate  is  written  down  to  nil.    Thereafter,  losses  are  recognized  only  to  the  extent  that  the  Company  is   committed  to  providing  financial  support  to  such  associates.   The  carrying  value  of  the  investment  in  an  associate  represents  the  cost  of  the  investment,  including  goodwill,  a  share  of   the  post-­‐acquisition  retained  earnings  and  losses,  accumulated  other  comprehensive  income  (“AOCI”)  and  any  impairment   losses.     At   the   end   of   each   reporting   period,   the   Company   assesses   whether   there   is   any   objective   evidence   that   its   investments  in  associates  are  impaired.       ii.    Functional  and  presentation  currency   The  functional  and  presentation  currency  of  the  Company  is  the  United  States  dollar.       Transactions  denominated  in  foreign  currencies  are  translated  into  the  United  States  dollar  as  follows:     • Monetary  assets  and  liabilities  are  translated  at  the  rates  of  exchange  on  the  consolidated  balance  sheet  date;     • Non-­‐monetary  assets  and  liabilities  are  translated  at  historical  exchange  rates  prevailing  at  each  transaction  date;       • • Revenue  and  expenses  are  translated  at  the  exchange  rate  at  the  date  of  the  transaction,  except  depreciation,   depletion  and  amortization,  which  are  translated  at  the  rates  of  exchange  applicable  to  the  related  assets,  and   share-­‐based  compensation  expense,  which  is  translated  at  the  rates  of  exchange  applicable  on  the  date  of  grant   of  the  share-­‐based  compensation;  and   Exchange  gains  and  losses  on  translation  are  included  in  earnings.   When   the   gain   or   loss   on   certain   non-­‐monetary   items,   such   as   long-­‐term   investments   classified   as   available-­‐for-­‐sale,   is   recognized  in  other  comprehensive  income  (“OCI”),  the  translation  differences  are  also  recognized  in  OCI.   KINROSS ANNUAL REPORT 2017 FS 12   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   iii.    Cash  and  cash  equivalents   Cash  and  cash  equivalents  include  cash  and  highly  liquid  investments  with  a  maturity  of  three  months  or  less  at  the  date  of   acquisition.       Restricted  cash  is  cash  held  in  banks  that  is  not  available  for  general  corporate  use.   iv.    Short-­‐term  investments   Short-­‐term  investments  include  short-­‐term  money  market  instruments  with  terms  to  maturity  at  the  date  of  acquisition  of   between  three  and  twelve  months.    The  carrying  value  of  short-­‐term  investments  is  equal  to  cost  and  accrued  interest.       v.    Long-­‐term  investments   Investments   in   entities   that   are   not   subsidiaries,   joint   operations,   joint   ventures   or   investments   in   associates   are   designated   as   available-­‐for-­‐sale   investments.     These   investments   are   measured   at   fair   value   on   acquisition   and   at   each   reporting  date.    Any  unrealized  holding  gains  and  losses  related  to  these  investments  are  excluded  from  net  earnings  and   are   included   in   OCI   until   an   investment   is   sold   and   gains   or   losses   are   realized,   or   there   is   objective   evidence   that   the   investment  is  impaired.    When  there  is  evidence  that  an  investment  is  impaired,  the  cumulative  loss  that  was  previously   recognized  in  OCI  is  reclassified  from  AOCI  to  the  consolidated  statement  of  operations.       vi.    Inventories   Inventories   consisting   of   metal   in   circuit   ore,   metal   in-­‐process   and   finished   metal   are   valued   at   the   lower   of   cost   or   net   realizable  value  (“NRV”).    NRV  is  calculated  as  the  difference  between  the  estimated  gold  prices  based  on  prevailing  and   long-­‐term  metal  prices  and  estimated  costs  to  complete  production  into  a  saleable  form  and  estimated  costs  to  sell.   Metal  in  circuit  is  comprised  of  ore  in  stockpiles  and  ore  on  heap  leach  pads.    Ore  in  stockpiles  is  coarse  ore  that  has  been   extracted  from  the  mine  and  is  available  for  further  processing.    Costs  are  added  to  stockpiles  based  on  the  current  mining   cost   per   tonne   and   removed   at   the   average   cost   per   tonne.     Costs   are   added   to   ore   on   the   heap   leach   pads   based   on   current   mining   costs   and   removed   from   the   heap   leach   pads   as   ounces   are   recovered,   based   on   the   average   cost   per   recoverable  ounce  of  gold  on  the  leach  pad.    Ore  in  stockpiles  not  expected  to  be  processed  in  the  next  twelve  months  is   classified  as  long-­‐term.   The  quantities  of  recoverable  gold  placed  on  the  leach  pads  are  reconciled  by  comparing  the  grades  of  ore  placed  on  the   leach   pads   to   the   quantities   of   gold   actually   recovered   (metallurgical   balancing);   however,   the   nature   of   the   leaching   process  inherently  limits  the  ability  to  precisely  monitor  inventory  levels.    As  a  result,  the  metallurgical  balancing  process  is   constantly   monitored   and   the   engineering   estimates   are   refined   based   on   actual   results   over   time.     Variances   between   actual  and  estimated  quantities  resulting  from  changes  in  assumptions  and  estimates  that  do  not  result  in  write  downs  to   NRV  are  accounted  for  on  a  prospective  basis.    The  ultimate  actual  recovery  of  gold  from  a  leach  pad  will  not  be  known   until  the  leaching  process  has  concluded.    In  the  event  that  the  Company  determines,  based  on  engineering  estimates,  that   a  quantity  of  gold  contained  in  ore  on  leach  pads  is  to  be  recovered  over  a  period  exceeding  twelve  months,  that  portion  is   classified  as  long-­‐term.   In-­‐process  inventories  represent  materials  that  are  in  the  process  of  being  converted  to  a  saleable  product.   Materials  and  supplies  are  valued  at  the  lower  of  average  cost  and  NRV.   Write  downs  of  inventory  are  recognized  in  the  consolidated  statement  of  operations  in  the  current  period.    The  Company   reverses  inventory  write  downs  in  the  event  that  there  is  a  subsequent  increase  in  NRV.   vii.    Borrowing  costs   Borrowing   costs   are   generally   expensed   as   incurred   except   where   they   relate   to   the   financing   of   qualifying   assets   that   require  a  substantial  period  of  time  to  get  ready  for  their  intended  use.    Qualifying  assets  include  the  cost  of  developing   mining   properties   and   constructing   new   facilities.     Borrowing   costs   related   to   qualifying   assets   are   capitalized   up   to   the   date  when  the  asset  is  ready  for  its  intended  use.   Where  funds  are  borrowed  specifically  to  finance  a  project,  the  amount  capitalized  represents  the  actual  borrowing  costs   incurred  net  of  any  investment  income  earned  on  the  investment  of  those  borrowings.    Where  the  funds  used  to  finance  a   project  form  part  of  general  borrowings,  the  amount  capitalized  is  calculated  using  a  weighted  average  of  rates  applicable   to  relevant  general  borrowings  of  the  Company  during  the  period.   KINROSS ANNUAL REPORT 2017 FS 13         NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   viii.    Business  combinations     A   business   combination   is   a   transaction   or   other   event   in   which   control   over   one   or   more   businesses   is   obtained.     A   business  is  an  integrated  set  of  activities  and  assets  that  is  capable  of  being  conducted  and  managed  for  the  purpose  of   providing   a   return   in   the   form   of   dividends,   lower   costs   or   other   economic   benefits.     A   business   consists   of   inputs   and   processes   applied   to   those   inputs   that   have   the   ability   to   create   outputs   that   provide   a   return   to   the   Company   and   its   shareholders.     A   business   need   not   include   all   of   the   inputs   and   processes   that   were   used   by   the   acquiree   to   produce   outputs  if  the  business  can  be  integrated  with  the  inputs  and  processes  of  the  Company  to  continue  to  produce  outputs.    If   the  integrated  set  of  activities  and  assets  is  in  the  exploration  and  development  stage,  and  thus,  may  not  have  outputs,  the   Company  considers  other  factors  to  determine  whether  the  set  of  activities  and  assets  is  a  business.    Those  factors  include,   but  are  not  limited  to,  whether  the  set  of  activities  and  assets:   • • • has  begun  planned  principal  activities;   has  employees,  intellectual  property  and  other  inputs  and  processes  that  could  be  applied  to  those  inputs;   is  pursuing  a  plan  to  produce  outputs;  and   • will  be  able  to  obtain  access  to  customers  that  will  purchase  the  outputs.   Not  all  of  the  above  factors  need  to  be  present  for  a  particular  integrated  set  of  activities  and  assets  in  the  development   stage  to  qualify  as  a  business.   Business  acquisitions  are  accounted  for  using  the  acquisition  method  whereby  acquired  assets  and  liabilities  are  recorded   at  fair  value  as  of  the  date  of  acquisition  with  the  excess  of  the  purchase  consideration  over  such  fair  value  being  recorded   as  goodwill  and  allocated  to  cash  generating  units  (“CGUs”).    Non-­‐controlling  interest  in  an  acquisition  may  be  measured  at   either  fair  value  or  at  the  non-­‐controlling  interest’s  proportionate  share  of  the  fair  value  of  the  acquiree’s  net  identifiable   assets.       If  the  fair  value  of  the  net  assets  acquired  exceeds  the  purchase  consideration,  the  difference  is  recognized  immediately  as   a  gain  in  the  consolidated  statement  of  operations.       Where  a  business  combination  is  achieved  in  stages,  previously  held  equity  interests  in  the  acquiree  are  re-­‐measured  at   their  acquisition-­‐date  fair  value  and  any  resulting  gain  or  loss  is  recognized  in  the  consolidated  statement  of  operations.   Acquisition  related  costs  are  expensed  during  the  period  in  which  they  are  incurred,  except  for  the  cost  of  debt  or  equity   instruments  issued  in  relation  to  the  acquisition  which  is  included  in  the  carrying  amount  of  the  related  instrument.   Certain  fair  values  may  be  estimated  at  the  acquisition  date  pending  confirmation  or  completion  of  the  valuation  process.     Where   provisional   values   are   used   in   accounting   for   a   business   combination,   they   are   adjusted   retrospectively   in   subsequent  periods.    However,  the  measurement  period  will  not  exceed  one  year  from  the  acquisition  date.       If  the  assets  acquired  are  not  a  business,  the  transaction  is  accounted  for  as  an  asset  acquisition.   ix.    Goodwill     Business  acquisitions  are  accounted  for  using  the  acquisition  method  whereby  acquired  assets  and  liabilities  are  recorded   at  fair  value  as  of  the  date  of  acquisition  with  the  excess  of  the  acquisition  amount  over  such  fair  value  being  recorded  as   goodwill  and  allocated  to  CGUs.    CGUs  are  the  smallest  identifiable  group  of  assets,  liabilities  and  associated  goodwill  that   generate   cash   inflows   that   are   largely   independent   of   the   cash   inflows   from   other   assets   or   groups   of   assets.     Each   individual  mineral  property  that  is  an  operating  or  development  stage  mine  is  typically  a  CGU.       Goodwill   arises   principally   because   of   the   following   factors:     (1)   the   going   concern   value   of   the   Company’s   capacity   to   sustain   and   grow   by   replacing   and   augmenting   mineral   reserves   through   completely   new   discoveries;   (2)   the   ability   to   capture   buyer-­‐specific   synergies   arising   upon   a   transaction;   (3)   the   optionality   (real   option   value   associated   with   the   portfolio  of  acquired  mines  as  well  as  each  individual  mine)  to  develop  additional  higher-­‐cost  mineral  reserves,  to  intensify   efforts  to  develop  the  more  promising  acquired  properties  and  to  reduce  efforts  at  developing  the  less  promising  acquired   properties   in   the   future     (this   optionality   may   result   from   changes   in   the   overall   economics   of   an   individual   mine   or   a   portfolio  of  mines,  largely  driven  by  changes  in  the  gold  price);  and  (4)  the  requirement  to  record  a  deferred  tax  liability  for   the  difference  between  the  assigned  values  and  the  tax  bases  of  the  assets  acquired  and  liabilities  assumed  in  a  business   combination.       KINROSS ANNUAL REPORT 2017 FS 14     NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   x.    Exploration  and  evaluation  (“E&E”)  costs   Exploration  and  evaluation  costs  are  those  costs  required  to  find  a  mineral  property  and  determine  commercial  viability.     E&E  costs  include  costs  to  establish  an  initial  mineral  resource  and  determine  whether  inferred  mineral  resources  can  be   upgraded   to   measured   and   indicated   mineral   resources   and   whether   measured   and   indicated   mineral   resources   can   be   converted  to  proven  and  probable  reserves.   E&E  costs  consist  of:   • • • • • gathering  exploration  data  through  topographical  and  geological  studies;   exploratory  drilling,  trenching  and  sampling;   determining  the  volume  and  grade  of  the  resource;   test  work  on  geology,  metallurgy,  mining,  geotechnical  and  environmental;  and   conducting  engineering,  marketing  and  financial  studies.   Project  costs  in  relation  to  these  activities  are  expensed  as  incurred  until  such  time  as  the  Company  expects  that  mineral   resources  will  be  converted  to  mineral  reserves  within  a  reasonable  period.    Thereafter,  costs  for  the  project  are  capitalized   prospectively  as  capitalized  exploration  and  evaluation  costs  in  property,  plant  and  equipment.   The   Company   also   recognizes   E&E   costs   as   assets   when   acquired   as   part   of   a   business   combination,   or   asset   purchase.     These  assets  are  recognized  at  fair  value.    Acquired  E&E  costs  consist  of:   • • fair  value  of  the  estimated  potential  ounces,  and       exploration  properties.   Acquired  or  capitalized  E&E  costs  for  a  project  are  classified  as  such  until  the  project  demonstrates  technical  feasibility  and   commercial   viability.     Upon   demonstrating   technical   feasibility   and   commercial   viability,   and   subject   to   an   impairment   analysis,   capitalized   E&E   costs   are   transferred   to   capitalized   development   costs   within   property,   plant   and   equipment.     Technical  feasibility  and  commercial  viability  generally  coincides  with  the  establishment  of  proven  and  probable  mineral   reserves;   however,   this   determination   may   be   impacted   by   management’s   assessment   of   certain   modifying   factors   including:  legal,  environmental,  social  and  governmental  factors.   xi.    Property,  plant  and  equipment   Property,   plant   and   equipment   are   recorded   at   cost   and   carried   net   of   accumulated   depreciation,   depletion   and   amortization  and  accumulated  impairment  losses.    The  initial  cost  of  an  asset  comprises  its  purchase  price  or  construction   cost,  any  costs  directly  attributable  to  bringing  the  asset  into  operation,  the  estimate  of  reclamation  and  remediation  and,   for  qualifying  assets,  capitalized  borrowing  costs.   Costs   to   acquire   mineral   properties   are   capitalized   and   represent   the   property’s   fair   value   at   the   time   it   was   acquired,   either  as  an  individual  asset  purchase  or  as  part  of  a  business  combination.       Interest  expense  attributable  to  the  cost  of  developing  mining  properties  and  to  constructing  new  facilities  is  capitalized   until  assets  are  ready  for  their  intended  use.   Acquired   or   capitalized   exploration   and   evaluation   costs   may   be   included   within   mineral   interests   in   development   and   operating  properties  or  pre-­‐development  properties  depending  upon  the  nature  of  the  property  to  which  the  costs  relate.     Repairs   and   maintenance   costs   are   expensed   as   incurred.     However,   expenditures   on   major   maintenance   rebuilds   or   overhauls  are  capitalized  when  it  is  probable  that  the  expenditures  will  extend  the  productive  capacity  or  useful  life  of  an   asset.   (a) Asset  categories   The   Company   categorizes   property,   plant   and   equipment   based   on   the   type   of   asset   and/or   the   stage   of   operation   or   development  of  the  property.       Land,   plant   and   equipment   includes   land,   mobile   and   stationary   equipment,   and   refining   and   processing   facilities   for   all   properties  regardless  of  their  stage  of  development  or  operation.   KINROSS ANNUAL REPORT 2017 FS 15         NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Mineral  interests  consist  of:   • • Development  and  operating  properties,  which  include  capitalized  development  and  stripping  costs,  cost  of   assets   under   construction,   exploration   and   evaluation   costs   and   mineral   interests   for   those   properties   currently  in  operation,  for  which  development  has  commenced,  or  for  which  proven  and  probable  reserves   have  been  declared;  and   Pre-­‐development  properties,  which  include  exploration  and  evaluation  costs  and  mineral  interests  for  those   properties  for  which  development  has  not  commenced.   (b) Depreciation,  depletion  and  amortization   For  plant  and  other  facilities,  stripping  costs,  reclamation  and  remediation  costs,  production  stage  mineral  interests  and   plant  expansion  costs,  the  Company  uses  the  units-­‐of-­‐production  (“UOP”)  method  for  determining  depreciation,  depletion   and  amortization.    The  expected  useful  lives  used  in  the  UOP  calculations  are  determined  based  on  the  facts  and   circumstances  associated  with  the  mineral  interest.    The  Company  evaluates  the  proven  and  probable  reserves  at  least  on   an  annual  basis  and  adjusts  the  UOP  calculation  to  correspond  with  the  changes  in  reserves.    The  expected  useful  life  used   in  determining  UOP  does  not  exceed  the  estimated  life  of  the  ore  body  based  on  recoverable  ounces  to  be  mined  from   estimated  proven  and  probable  reserves.    Any  changes  in  estimates  of  useful  lives  are  accounted  for  prospectively  from  the   date  of  the  change.   Stripping   and   other   costs   incurred   in   a   pit   expansion   are   capitalized   and   amortized   using   the   UOP   method   based   on   recoverable  ounces  to  be  mined  from  estimated  proven  and  probable  reserves  contained  in  the  pit  expansion.       Land  is  not  depreciated.       Mobile   and   other   equipment   are   depreciated,   net   of   residual   value,   using   the   straight-­‐line   method,   over   the   estimated   useful   life   of   the   asset.     Useful   lives   for   mobile   and   other   equipment   range   from   2   to   10   years,   but   do   not   exceed   the   related  estimated  mine  life  based  on  proven  and  probable  reserves.       The  Company  reviews  useful  lives  and  estimated  residual  values  of  its  property,  plant  and  equipment  annually.   Acquired  or  capitalized  exploration  and  evaluation  costs  and  assets  under  construction  are  not  depreciated.    These  assets   are  depreciated  when  they  are  ready  for  use.     (c) Derecognition   The   carrying   amount   of   an   item   of   property,   plant   and   equipment   is   derecognized   on   disposal   of   the   asset   or   when   no   future   economic   benefits   are   expected   to   accrue   to   the   Company   from   its   continued   use.     Any   gain   or   loss   arising   on   derecognition  is  included  in  the  consolidated  statement  of  operations  in  the  period  in  which  the  asset  is  derecognized.    The   gain  or  loss  is  determined  as  the  difference  between  the  carrying  value  and  the  net  proceeds  on  the  sale  of  the  assets,  if   any,  at  the  time  of  disposal.   xii.    Valuation  of  Goodwill  and  Long-­‐lived  Assets   Goodwill   is   tested   for   impairment   on   an   annual   basis   as   at   December   31,   and   at   any   other   time   if   events   or   changes   in   circumstances  indicate  that  the  recoverable  amount  of  a  CGU  has  been  reduced  below  its  carrying  amount.       The  carrying  value  of  property,  plant  and  equipment  is  reviewed  each  reporting  period  to  determine  whether  there  is  any   indication  of  impairment  or  reversal  of  impairment.    If  any  such  indication  exists,  then  the  asset’s  recoverable  amount  is   estimated.    In  addition,  capitalized  exploration  and  evaluation  costs  are  assessed  for  impairment  upon  demonstrating  the   technical   feasibility   and   commercial   viability   of   a   project.     For   such   non-­‐current   assets,   the   recoverable   amount   is   determined   for   an   individual   asset   unless   the   asset   does   not   generate   cash   inflows   that   are   independent   of   those   generated  from  other  assets  or  groups  of  assets,  in  which  case,  the  individual  assets  are  grouped  together  into  CGUs  for   impairment  testing  purposes.   If  the  carrying  amount  of  the  CGU  or  asset  exceeds  its  recoverable  amount,  an  impairment  is  considered  to  exist  and  an   impairment  loss  is  recognized  in  the  consolidated  statement  of  operations  to  reduce  the  carrying  value  to  its  recoverable   amount.       For  property,  plant  and  equipment  and  other  long-­‐lived  assets,  a  previously  recognized  impairment  loss  is  reversed  if  there   has  been  a  change  in  the  estimates  used  to  determine  the  asset’s  recoverable  amount  since  the  last  impairment  loss  was     KINROSS ANNUAL REPORT 2017 FS 16   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   recognized.   The   reversal   is   limited   to   the   carrying   value   that   would   have   been   determined,   net   of   any   applicable   depreciation,  had  no  impairment  charge  been  recognized  in  prior  years.     The  recoverable  amount  of  a  CGU  or  asset  is  the  higher  of  its  fair  value  less  cost  of  disposal  and  its  value  in  use.       Fair  value  is  determined  as  the  amount  that  would  be  obtained  from  the  sale  of  the  asset  in  an  arm’s  length  transaction   between  knowledgeable  and  willing  parties.    Fair  value  for  mineral  assets  is  generally  determined  as  the  present  value  of   the  estimated  future  cash  flows  expected  to  arise  from  the  continued  use  of  the  asset,  including  any  expansion  prospects,   and  its  eventual  disposal,  using  assumptions  that  an  independent  market  participant  may  take  into  account.    These  cash   flows   are   discounted   by   an   appropriate   discount   rate   to   arrive   at   a   net   present   value   or   net   asset   value   (“NAV”)   of   the   asset.   Value  in  use  is  determined  as  the  present  value  of  the  estimated  future  cash  flows  expected  to  arise  from  the  continued   use  of  the  asset  in  its  present  form  and  its  eventual  disposal.    Value  in  use  is  determined  by  applying  assumptions  specific   to   the   Company’s   continued   use   of   the   asset   and   does   not   take   into   account   assumptions   of   significant   future   enhancements  of  an  asset’s  performance  or  capacity  to  which  the  Company  is  not  committed.   Estimates   of   expected   future   cash   flows   reflect   estimates   of   future   revenues,   cash   costs   of   production   and   capital   expenditures   contained   in   the   Company’s   long-­‐term   life   of   mine   (“LOM”)   plans,   which   are   updated   for   each   CGU   on   an   annual  basis.    The  Company’s  LOM  plans  are  based  on  detailed  research,  analysis  and  modeling  to  maximize  the  NAV  of   each   CGU.     As   such,   these   plans   consider   the   optimal   level   of   investment,   overall   production   levels   and   sequence   of   extraction  taking  into  account  all  relevant  characteristics  of  the  ore  body,  including  waste  to  ore  ratios,  ore  grades,  haul   distances,  chemical  and  metallurgical  properties  impacting  process  recoveries,  capacities  of  available  extraction,  haulage   and  processing  equipment,  and  other  factors.    Therefore,  the  LOM  plan  is  an  appropriate  basis  for  forecasting  production   output   in   each   future   year   and   the   related   production   costs   and   capital   expenditures.     The   LOM   plans   have   been   determined  using  cash  flow  projections  from  financial  budgets  approved  by  senior  management  covering  a   9  year  to  25   year  period.   Projected  future  revenues  reflect  the  forecast  future  production  levels  at  each  of  the  Company’s  CGUs  as  detailed  in  the   LOM   plans.     These   forecasts   may   include   the   production   of   mineralized   material   that   does   not   currently   qualify   for   inclusion  in  mineral  reserve  or  mineral  resource  classification.    This  is  consistent  with  the  methodology  used  to  measure   value   beyond   proven   and   probable   reserves   when   allocating   the   purchase   price   of   a   business   combination   to   acquired   mining  assets.    The  fair  value  arrived  at  as  described  above,  is  the  Company’s  estimate  of  fair  value  for  accounting  purposes   and   is   not   a   “preliminary   assessment”   as   defined   in   Canadian   National   Instrument   43-­‐101   “Standards   of   Disclosure   for   Mineral  Projects”.   Projected  future  revenues  also  reflect  the  Company’s  estimates  of  future  metals  prices,  which  are  determined  based  on   current  prices,  forward  prices  and  forecasts  of  future  prices  prepared  by  industry  analysts.    These  estimates  often  differ   from   current   price   levels,   but   the   methodology   used   is   consistent   with   how   a   market   participant   would   assess   future   long-­‐term   metals   prices.     For   the   2017   annual   analysis,   estimated   2018,   2019   and   long-­‐term   prices   of   gold   and   silver   of   $1,300  per  ounce  and  $19.00  per  ounce,  respectively,  were  used.    For  the  2016  annual  analysis,  estimated  2017,  2018  and   long-­‐term  gold  prices  of  $1,200,  $1,250  and  $1,250  per  ounce,  respectively,  and  estimated  2017,  2018  and  long-­‐term  silver   prices  of  $18.50,  $18.70  and  $20.00  per  ounce,  respectively,  were  used.   The  Company’s  estimates  of  future  cash  costs  of  production  and  capital  expenditures  are  based  on  the  LOM  plans  for  each   CGU.     Costs   incurred   in   currencies   other   than   the   US   dollar   are   translated   to   US   dollar   equivalents   based   on   long-­‐term   forecasts  of  foreign  exchange  rates,  on  a  currency  by  currency  basis,  obtained  from  independent  sources  of  economic  data.     Oil  prices  are  a  significant  component  of  cash  costs  of  production  and  are  estimated  based  on  the  current  price,  forward   prices,  and  forecasts  of  future  prices  from  third  party  sources.    For  the  2017  annual  analysis,  an  estimated  short-­‐term  and   long-­‐term  oil  price  of  $55  per  barrel  was  used.    For  the  2016  annual  analysis,  an  estimated  short-­‐term  and  long-­‐term  oil   price  of  $60  per  barrel  was  used.   The  discount  rate  applied  to  present  value  the  net  future  cash  flows  is  based  on  a  real  weighted  average  cost  of  capital  by   country   to   account   for   geopolitical   risk.     For   the   2017   annual   analysis,   real   discount   rates   of   between   4.35%   and   7.10%   were  used  for  the  CGUs  tested.  For  the  CGUs  tested  in  the  2016  annual  analysis,  real  discount  rates  of  between  5.05%  and   5.18%  were  used.   Since  public  gold  companies  typically  trade  at  a  market  capitalization  that  is  based  on  a  multiple  of  their  underlying  NAV,  a   market   participant   would   generally   apply   a   NAV   multiple   when   estimating   the   fair   value   of   a   gold   mining   property.     Consequently,  where  applicable,  the  Company  estimates  the  fair  value  of  each  CGU  by  applying  a  market  NAV  multiple  to   the  NAV  of  each  CGU.       KINROSS ANNUAL REPORT 2017 FS 17     NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   When   selecting   NAV   multiples   to   arrive   at   fair   value,   the   Company   considered   the   trading   prices   and   NAV   estimates   of   comparable  gold  mining  companies  as  at  December  31,  2017  in  respect  of  the  fair  value  determinations  at  that  date,  which   ranged  from  0.8  to  1.6.    NAV  multiples  observed  at  December  31,  2016  were  in  the  range  of  0.7  to  1.5.    The  selected  ranges   of  multiples  applied  to  each  CGU,  which  may  be  different  from  the  ranges  noted  above,  took  into  consideration,  among   other   factors:   expected   production   growth   in   the   near   term;   average   cash   costs   over   the   life   of   the   mine;   potential   remaining  mine  life;  and  stage  of  development  of  the  asset.   xiii.    Financial  instruments  and  hedging  activity   (a) Financial  instrument  classification  and  measurement   Financial  instruments  are  measured  on  initial  recognition  at  fair  value,  plus,  in  the  case  of  financial  instruments  other  than   those  classified  as  “fair  value  through  profit  and  loss”,  directly  attributable  transaction  costs.    Measurement  of  financial   assets  in  subsequent  periods  depends  on  whether  the  financial  instrument  has  been  classified  as  fair  value  through  profit   and   loss,   “available-­‐for-­‐sale”,   “held-­‐to-­‐maturity”,   or   “loans   and   receivables”.     Measurement   of   financial   liabilities   subsequent   to   initial   recognition   depends   on   whether   they   are   classified   as   fair   value   through   profit   and   loss   or   “other   financial  liabilities”.   Financial  assets  and  financial  liabilities  at  fair  value  through  profit  and  loss  include  financial  assets  and  financial  liabilities   that   are   held   for   trading   or   designated   upon   initial   recognition   as   at   fair   value   through   profit   and   loss.     These   financial   instruments  are  measured  at  fair  value  with  changes  in  fair  values  recognized  in  the  consolidated  statement  of  operations.     Financial   assets   classified   as   available-­‐for-­‐sale   are   measured   at   fair   value,   with   changes   in   fair   values   recognized   in   OCI,   except   when   there   is   objective   evidence   that   the   asset   is   impaired,   at   which   point   the   cumulative   loss   that   had   been   previously   recognized   in   OCI   is   recognized   in   the   consolidated   statement   of   operations.     Financial   assets   classified   as   held-­‐to-­‐maturity   and   loans   and   receivables   are   measured   subsequent   to   initial   recognition   at   amortized   cost   using   the   effective  interest  method.    Financial  liabilities,  other  than  financial  liabilities  classified  as  fair  value  through  profit  and  loss,   are  measured  in  subsequent  periods  at  amortized  cost  using  the  effective  interest  method.       Cash  and  cash  equivalents,  restricted  cash  and  short-­‐term  investments  are  designated  as  fair  value  through  profit  and  loss   and   are   measured   at   fair   value.     Trade   receivables   and   certain   other   assets   are   designated   as   loans   and   receivables.     Long-­‐term   investments   in   equity   securities,   where   the   Company   cannot   exert   significant   influence,   are   classified   as   available-­‐for  sale.    Accounts  payable  and  accrued  liabilities  and  long-­‐term  debt  are  classified  as  other  financial  liabilities.       Derivative  assets  and  liabilities  include  derivative  financial  instruments  that  do  not  qualify  as  hedges,  or  are  not  designated   as  hedges,  and  are  classified  as  fair  value  through  profit  and  loss.       (b) Hedges   The   Company   formally   documents   all   relationships   between   hedging   instruments   and   hedged   items,   as   well   as   its   risk   management  objectives  and  strategies  for  undertaking  hedge  transactions.    This  process  includes  linking  all  derivatives  to   specific   assets   and   liabilities   on   the   balance   sheet   or   to   specific   firm   commitments   or   forecasted   transactions.     Hedge   effectiveness  is  assessed  based  on  the  degree  to  which  the  cash  flows  from  the  derivative  contracts  are  expected  to  offset   the  cash  flows  of  the  underlying  position  or  transaction  being  hedged.    At  the  time  of  inception  of  the  hedge  and  on  an   ongoing  basis,  the  Company  assesses  whether  the  derivatives  that  are  used  in  hedging  transactions  are  highly  effective  in   offsetting  changes  in  fair  values  or  cash  flows  of  hedged  items.       Derivative  contracts  that  have  been  designated  as  cash  flow  hedges  have  been  entered  into  in  order  to  effectively  establish   prices  for  future  production  of  metals,  to  hedge  exposure  to  exchange  rate  fluctuations  of  foreign  currency  denominated   settlement  of  capital  and  operating  expenditures,  to  establish  prices  for  future  purchases  of  energy  or  to  hedge  exposure   to   interest   rate   fluctuations.     Unrealized   gains   or   losses   arising   from   changes   in   the   fair   value   of   these   contracts   are   recorded  in  OCI,  net  of  tax,  and  are  only  included  in  earnings  when  the  underlying  hedged  transaction,  identified  at  the   contract   inception,   is   completed.     Any   ineffective   portion   of   a   hedge   relationship   is   recognized   immediately   in   the   consolidated  statement  of  operations.    The  Company  matches  the  realized  gains  or  losses  on  contracts  designated  as  cash   flow  hedges  with  the  hedged  expenditures  at  the  maturity  of  the  contracts.       When  derivative  contracts  designated  as  cash  flow  hedges  have  been  terminated  or  cease  to  be  effective  prior  to  maturity   and   no   longer   qualify   for   hedge   accounting,   any   gains   or   losses   recorded   in   OCI   up   until   the   time   the   contracts   do   not   qualify   for   hedge   accounting,   remain   in   OCI.     Amounts   recorded   in   OCI   are   recognized   in   the   consolidated   statement   of   operations  in  the  period  in  which  the  underlying  hedged  transaction  is  completed.    Gains  or  losses  arising  subsequent  to   the  derivative  contracts  not  qualifying  for  hedge  accounting  are  recognized  in  the  consolidated  statement  of  operations  in   the  period  in  which  they  occur.   For   hedges   that   do   not   qualify   for   hedge   accounting,   gains   or   losses   are   recognized   in   the   consolidated   statement   of   operations  in  the  current  period.   KINROSS ANNUAL REPORT 2017 FS 18   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   (c) Impairment  of  financial  assets   The   Company   assesses   at   each   reporting   date   whether   there   is   objective   evidence   that   a   financial   asset   or   a   group   of         financial  assets  is  impaired.    In  the  case  of  investments  classified  as  available-­‐for-­‐sale,  an  evaluation  is  made  as  to  whether   a  decline  in  fair  value  is  significant  or  prolonged  based  on  an  analysis  of  indicators  such  as  market  price  of  the  investment   and   significant   adverse   changes   in   the   technological,   market,   economic   or   legal   environment   in   which   the   investee   operates.   If   an   available-­‐for-­‐sale   financial   asset   is   impaired,   an   amount   equal   to   the   difference   between   its   carrying   value   and   its   current   fair   value   is   transferred   from   AOCI   and   recognized   in   the   consolidated   statement   of   operations.     Reversals   of   impairment  charges  in  respect  of  equity  instruments  classified  as  available-­‐for-­‐sale  are  not  recognized  in  the  consolidated   statement  of  operations.       xiv.    Share-­‐based  payments   The  Company  has  a  number  of  equity-­‐settled  and  cash-­‐settled  share-­‐based  compensation  plans  under  which  the  Company   issues  either  equity  instruments  or  makes  cash  payments  based  on  the  value  of  the  underlying  equity  instrument  of  the   Company.    The  Company’s  share-­‐based  compensation  plans  are  comprised  of  the  following:   Share  Option  Plan:    Stock  options  are  generally  equity-­‐settled.    The  fair  value  of  stock  options  at  the  grant  date  is  estimated   using  the  Black-­‐Scholes  option  pricing  model.    Compensation  expense  is  recognized  over  the  stock  option  vesting  period   based  on  the  number  of  options  estimated  to  vest.    Management  estimates  the  number  of  awards  likely  to  vest  at  the  time   of  a  grant  and  at  each  reporting  date  up  to  the  vesting  date.    Annually,  the  estimated  forfeiture  rate  is  adjusted  for  actual   forfeitures  in  the  period.    On  exercise  of  the  vested  options,  the  shares  are  issued  from  treasury.       Restricted  Share  Plan:  Restricted  share  units  (“RSUs”)  and  Restricted  performance  share  units  (“RPSUs”)  are  granted  under   the   Restricted   Share   Plan.     Both   RSUs   and   RPSUs   are   generally   equity-­‐settled   and   awarded   to   certain   employees   as   a   percentage  of  long-­‐term  incentive  awards.       (a) RSUs   are   recorded   at   fair   value   based   on   the   market   value   of   the   shares   at   the   grant   date.     The   Company’s   compensation   expense   is   recognized   over   the   vesting   period   based   on   the   number   of   units   estimated   to   vest.     Management   estimates   the   number   of   awards   likely   to   vest   on   grant   and   at   each   reporting   date   up   to   the   vesting   date.     Annually,   the   estimated   forfeiture   rate   is   adjusted   for   actual   forfeitures   in   the   period.     On   vesting   of   RSUs,   shares  are  generally  issued  from  treasury.   (b) RPSUs  are  subject  to  certain  vesting  requirements  based  on  performance  criteria  over  the  vesting  period  established   by  the  Company.    RPSUs  are  recorded  at  fair  value  as  follows:    The  portion  of  the  RPSUs  related  to  market  conditions   are  recorded  at  fair  value  based  on  the  application  of  a  Monte  Carlo  pricing  model  at  the  date  of  grant  and  the  portion   related   to   non-­‐market   conditions   is   fair   valued   based   on   the   market   value   of   the   shares   at   the   date   of   grant.     The   Company’s  compensation  expense  is  recognized  over  the  vesting  period  based  on  the  number  of  units  estimated  to   vest.     Management   estimates   the   number   of   awards   likely   to   vest   on   grant   and   at   each   reporting   date   up   to   the   vesting   date.     Annually,   the   estimated   forfeiture   rate   is   adjusted   for   actual   forfeitures   in   the   period.     On   vesting   of   RPSUs,  shares  are  generally  issued  from  treasury.   Deferred  Share  Unit  Plan:    Deferred  share  units  (“DSUs”)  are  cash-­‐settled  and  accounted  for  as  a  liability  at  fair  value  which   is  based  on  the  market  value  of  the  shares  at  the  grant  date.    The  fair  value  of  the  liability  is  re-­‐measured  each  period  based   on   the   current   market   value   of   the   underlying   stock   at   period   end   and   any   changes   in   the   liability   are   recorded   as   compensation  expense  each  period.       Employee  Share  Purchase  Plan:    The  Company’s  contribution  to  the  employee  Share  Purchase  Plan  (“SPP”)  is  recorded  as   compensation   expense   on   a   payroll   cycle   basis   as   the   employer’s   obligation   to   contribute   is   incurred.     The   cost   of   the   common  shares  purchased  under  the  SPP  are  either  based  on  the  weighted  average  closing  price  of  the  last  twenty  trading   sessions  prior  to  the  end  of  the  period  for  shares  issued  from  treasury,  or  are  based  on  the  price  paid  for  common  shares   purchased  in  the  open  market.   xv.    Metal  sales   Metal  sales  includes  sales  of  refined  gold  and  silver  and  doré,  which  are  generally  physically  delivered  to  customers  in  the   period   in   which   they   are   produced,   with   their   sales   price   based   on   prevailing   spot   market   metal   prices.     Revenue   from   metal  sales  is  recognized  when  all  the  following  conditions  have  been  satisfied:   •   The  significant  risks  and  rewards  of  ownership  have  been  transferred;   KINROSS ANNUAL REPORT 2017 FS 19       NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   •   •   •   •   Neither   continuing   managerial   involvement   to   the   degree   usually   associated   with   ownership,   nor   effective   control   over  the  goods  sold,  has  been  retained;   The  amount  of  revenue  can  be  measured  reliably;   It  is  probable  that  the  economic  benefits  associated  with  the  transaction  will  flow  to  the  Company;  and   The  costs  incurred  or  to  be  incurred  in  respect  of  the  transaction  can  be  measured  reliably.   These  conditions  are  generally  met  when  the  sales  price  is  fixed  and  title  has  passed  to  the  customer.       xvi.    Provision  for  reclamation  and  remediation     The   Company   records   a   liability   and   corresponding   asset   for   the   present   value   of   the   estimated   costs   of   legal   and   constructive   obligations   for   future   site   reclamation   and   closure   where   the   liability   is  more   likely   than   not   to   exist   and   a   reasonable   estimate   can   be   made   of   the   obligation.     The   estimated   present   value   of   the   obligation   is   reassessed   on   an   annual  basis  or  when  new  material  information  becomes  available.    Increases  or  decreases  to  the  obligation  usually  arise   due   to   changes   in   legal   or   regulatory   requirements,   the   extent   of   environmental   remediation   required,   methods   of   reclamation,   cost   estimates,   or   discount   rates.     Changes   to   the   provision   for   reclamation   and   remediation   obligations   related  to  operating  mines,  which  are  not  the  result  of  current  production  of  inventory,  are  recorded  with  an  offsetting   change  to  the  related  asset.    For  properties  where  mining  activities  have  ceased  or  are  in  reclamation,  changes  are  charged   directly  to  earnings.    The  present  value  is  determined  based  on  current  market  assessments  of  the  time  value  of  money   using  discount  rates  specific  to  the  country  in  which  the  reclamation  site  is  located  and  is  determined  as  the  risk-­‐free  rate   of  borrowing  approximated  by  the  yield  on  sovereign  debt  for  that  country,  with  a  maturity  approximating  the  end  of  mine   life.     The   periodic   unwinding   of   the   discount   is   recognized   in   the   consolidated   statement   of   operations   as   a   finance   expense.   xvii.    Income  tax   The  income  tax  expense  or  benefit  for  the  period  consists  of  two  components:  current  and  deferred.    Income  tax  expense  is   recognized  in  the  consolidated  statement  of  operations  except  to  the  extent  it  relates  to  a  business  combination  or  items   recognized  directly  in  equity.   Current  tax  is  the  expected  tax  payable  or  receivable  on  the  taxable  profit  or  loss  for  the  year.    Current  tax  is  calculated   using  tax  rates  and  laws  that  were  enacted  or  substantively  enacted  at  the  balance  sheet  date  in  each  of  the  jurisdictions   and  includes  any  adjustments  for  taxes  payable  or  recovery  in  respect  of  prior  periods.   Deferred  tax  is  recognized  in  respect  of  temporary  differences  between  the  carrying  amount  of  assets  and  liabilities  in  the   consolidated   balance   sheet   and   the   corresponding   tax   bases   used   in   the   computation   of   taxable   profit.     Deferred   tax   is   calculated  based  on  the  expected  manner  of  realization  or  settlement  of  the  carrying  amount  of  assets  and  liabilities,  using   tax   rates   that   are   expected   to   apply   in   the   year   of   realization   or   settlement   based   on   tax   rates   and   laws   enacted   or   substantively  enacted  at  the  balance  sheet  date.   Deferred  tax  liabilities  are  generally  recognized  for  all  taxable  temporary  differences.    Deferred  tax  liabilities  are  recognized   for  taxable  temporary  differences  arising  on  investments  in  subsidiaries,  associates  and  joint  ventures  except  where  the   reversal   of   the   temporary   difference   can   be   controlled   and   it   is   probable   that   the   difference   will   not   reverse   in   the   foreseeable  future.       Deferred  tax  assets  are  recognized  for  all  deductible  temporary  differences,  carryforward  of  unused  tax  credits  and  unused   tax  losses  to  the  extent  it  is  probable  future  taxable  profits  will  be  available  against  which  they  can  be  utilized.    The  carrying   amount   of   deferred   tax   assets   is   reviewed   at   each   balance   sheet   date   and   reduced   to   the   extent   that   it   is   no   longer   probable  that  sufficient  taxable  profits  will  be  available  to  allow  all  or  part  of  the  asset  to  be  recovered.   Deferred  tax  liabilities  are  not  recognized  on  temporary  differences  that  arise  from  goodwill  which  is  not  deductible  for  tax   purposes.     Deferred   tax   assets   and   liabilities   are   not   recognized   in   respect   of   temporary   differences   that   arise   on   initial   recognition  of  assets  and  liabilities  acquired  other  than  in  a  business  combination.   Deferred  tax  assets  and  liabilities  are  offset  where  they  relate  to  income  taxes  levied  by  the  same  taxation  authority  and   the  Corporation  has  the  legal  right  and  intent  to  offset.   xviii.    Earnings  (loss)  per  share   Earnings  (loss)  per  share  calculations  are  based  on  the  weighted  average  number  of  common  shares  and  common  share   equivalents  issued  and  outstanding  during  the  period.    Basic  earnings  (loss)  per  share  amounts  are  calculated  by  dividing   KINROSS ANNUAL REPORT 2017 FS 20   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   net   earnings   (loss)   attributable   to   common   shareholders   for   the   period   by   the   weighted   average   number   of   common   shares  outstanding  during  the  period.    Diluted  earnings  (loss)  per  share  amounts  are  calculated  by  dividing  net  earnings   (loss)  attributable  to  common  shareholders  for  the  period  by  the  diluted  weighted  average  shares  outstanding  during  the   period.       Diluted  earnings  per  share  is  calculated  using  the  treasury  method.    The  treasury  method,  which  assumes  that  outstanding   stock  options,  warrants,  RSUs  and  RPSUs  with  an  average  exercise  price  below  the  market  price  of  the  underlying  shares,   are  exercised  and  the  assumed  proceeds  are  used  to  repurchase  common  shares  of  the  Company  at  the  average  market   price  of  the  common  shares  for  the  period.   4. RECENT  ACCOUNTING  PRONOUNCEMENTS   Revenue  from  Contracts  with  Customers   In   May   2014,   the   IASB   issued   IFRS   15   “Revenue   from   Contracts   with   Customers”   (“IFRS   15”).     IFRS   15   replaces   IAS   11   “Construction   Contracts”,   IAS   18   “Revenue”,   IFRIC   13   “Customer   Loyalty   Programmes”,   IFRIC   15   “Agreements   for   the   Construction   of   Real   Estate”,   IFRIC   18   “Transfer   of   Assets   from   Customers”   and   SIC   31   “Revenue   –   Barter   Transactions   Involving  Advertising  Services”,  and  is  effective  for  annual  periods  beginning  on  or  after  January  1,  2018.       The  standard  contains  a  single  model  that  applies  to  contracts  with  customers  and  two  approaches  to  recognizing  revenue:   at   a   point   in   time   or   over   time.     The   model   features   a   contract-­‐based   five-­‐step   analysis   of   transactions   to   determine   whether,  how  much  and  when  revenue  is  recognized.    New  estimates  and  judgmental  thresholds  have  been  introduced,   which  may  affect  the  amount  and/or  timing  of  revenue  recognized.  The  Company  will  adopt  IFRS  15  for  the  annual  period   beginning  January  1,  2018  using  the  modified  retrospective  approach.       The   Company   has   completed   its   assessment   of   the   impact   of   IFRS   15   and   does   not   expect   the   new   standard   to   have   a   material  impact  on  the  consolidated  financial  statements.   Financial  instruments   In  July  2014,  the  IASB  issued  the  final  version  of  IFRS  9  “Financial  Instruments”  (“IFRS  9”),  which  replaces  IAS  39  “Financial   Instruments:     Recognition   and   Measurement”   (“IAS   39”).    IFRS   9   is   effective   for   annual   periods   beginning   on   or   after   January  1,  2018.  The  Company  will  adopt  IFRS  9  for  the  annual  period  beginning  January  1,  2018  on  a  retrospective  basis,   using  certain  available  transitional  provisions.   IFRS  9  provides  a  revised  model  for  classification  and  measurement  of  financial  assets,  including  a  new  “expected  credit   loss”  (ECL)  impairment  model.  The  revised  model  for  classifying  financial  assets  results  in  classification  according  to  their   contractual   cash   flow   characteristics   and   the   business   models   under   which   they   are   held.   IFRS   9   introduces   a   reformed   approach   to   hedge   accounting.     IFRS   9   also   largely   retains   the   existing   requirements   in   IAS   39   for   the   classification   of   financial  liabilities.   The  Company  has  completed  its  assessment  of  the  impact  of  IFRS  9  and  expects  the  following  impacts  upon  adoption:   i) ii) The  Company  will  make  the  irrevocable  election  available  under  IFRS  9  to  continue  to  measure  its  long-­‐term  investments  in   equity   securities   at   fair   value   through   OCI.   Under   the   new   standard,   all   realized   and   unrealized   gains   and   losses   will   be   recognized  permanently  in  OCI  with  no  reclassification  to  profit  or  loss.  On  adoption  of  IFRS  9,  the  Company  expects  to  make   an   adjustment   to   opening   retained   earnings   of   $56.3   million   with   a   corresponding   adjustment   to   accumulated   other   comprehensive   income.   The   new   classification   and   measurement   requirements   under   IFRS   9   are   not   expected   to   have   a   material  impact  on  the  Company’s  other  financial  assets  and  financial  liabilities.     The  Company  expects  that  its  existing  hedge  accounting  relationships  that  qualified  for  hedge  accounting  under  IAS  39  will   continue   to   qualify   for   hedge   accounting   under   IFRS   9,   following   planned   changes   to   its   internal   documentation   and   monitoring  processes.   iii) The  other  changes  under  IFRS  9,  including  the  new  ECL  impairment  model,  are  not  expected  to  have  a  material  impact  on  the   Company’s  financial  statements.   KINROSS ANNUAL REPORT 2017 FS 21                           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Leases   In  January  2016,  the  IASB  issued  IFRS  16  “Leases”  (“IFRS  16”),  which  replaces  IAS  17  “Leases”.    The  standard  is  effective  for   annual  periods  beginning  on  or  after  January  1,  2019,  and  permits  early  adoption,  provided  IFRS  15  has  been  applied,  or  is   applied  at  the  same  date  as  IFRS  16.   IFRS  16  requires  lessees  to  recognize  assets  and  liabilities  for  most  leases  on  its  balance  sheet,  as  well  as  corresponding   depreciation  and  interest  expense.       The  Company  will  adopt  IFRS  16  for  the  annual  period  beginning  January  1,  2019.    The  Company  expects  IFRS  16  will  result   in  the  recognition  of  additional  assets  and  liabilities  on  the  balance  sheet,  and  a  corresponding  increase  in  depreciation  and   interest   expense.     The   Company   also   expects   cash   flow   from   operating   activities   to   increase   under   IFRS   16   as   lease   payments  for  most  leases  will  be  recorded  as  financing  outflows  in  the  statement  of  cash  flows.    The  extent  of  the  impact   of  adopting  the  standard  has  not  yet  been  determined.       The   Company   has   completed   the   development   of   its   implementation   plan   and   expects   to   report   more   detailed   information,  including  estimated  quantitative  financial  impacts,  if  material,  in  its  consolidated  financial  statements  as  the   effective  date  approaches.   Foreign  Currency  Transactions  and  Advance  Consideration   In   December   2016,   the   IASB   issued   IFRIC   Interpretation   22   “Foreign   Currency   Transactions   and   Advance   Consideration”   (“IFRIC  22”).    IFRIC  22  is  applicable  for  annual  periods  beginning  on  or  after  January  1,  2018,  and  permits  early  adoption.       IFRIC   22   clarifies   which   date   should   be   used   for   translation   when   a   foreign   currency   transaction   involves   an   advance   payment   or   receipt.     The   interpretation   clarifies   that   the   date   of   the   transaction   for   the   purpose   of   determining   the   exchange  rate  to  use  on  initial  recognition  of  the  related  asset,  expense  or  income  (or  part  of  it)  is  the  date  on  which  an   entity   initially   recognizes   the   non-­‐monetary   asset   or   non-­‐monetary   liability   arising   from   the   payment   or   receipt   of   the   advance  consideration.   The   Company   will   adopt   IFRIC   22   in   its   financial   statements   for   the   annual   period   beginning   January   1,   2018   on   a   prospective   basis.     The   Company   has   completed   its   assessment   of   the   impact   of   IFRIC   22   and   does   not   expect   the   interpretation  to  have  a  material  impact  on  the  consolidated  financial  statements.   5. SIGNIFICANT  JUDGMENTS,  ESTIMATES  AND  ASSUMPTIONS     The  preparation  of  the  Company’s  financial  statements  in  conformity  with  IFRS  requires  management  to  make  judgments,   estimates  and  assumptions  that  affect  the  reported  amounts  of  assets  and  liabilities  and  disclosures  of  contingent  assets   and   liabilities   at   the   date   of   the   financial   statements   and   the   reported   amounts   of   revenues   and   expenses   during   the   reporting  period.    Estimates  and  assumptions  are  continually  evaluated  and  are  based  on  management’s  experience  and   other  factors,  including  expectations  of  future  events  that  are  believed  to  be  reasonable  under  the  circumstances.    Actual   results  could  differ  from  these  estimates.   i. Significant  Judgments  in  Applying  Accounting  Policies   The   areas   which   require   management   to   make   significant   judgments   in   applying   the   Company’s   accounting   policies   in   determining  carrying  values  include,  but  are  not  limited  to:   (a) Mineral  Reserves  and  Mineral  Resources   The  information  relating  to  the  geological  data  on  the  size,  depth  and  shape  of  the  ore  body  requires  complex  geological   judgments   to   interpret   the   data.     Changes   in   the   proven   and   probable   mineral   reserves   or   measured   and   indicated   and   inferred   mineral   resources   estimates   may   impact   the   carrying   value   of   property,   plant   and   equipment,   goodwill,   reclamation   and   remediation   obligations,   recognition   of   deferred   tax   amounts   and   depreciation,   depletion   and   amortization.       KINROSS ANNUAL REPORT 2017 FS 22                           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   (b) Depreciation,  depletion  and  amortization     Significant  judgment  is  involved  in  the  determination  of  useful  life  and  residual  values  for  the  computation  of  depreciation,   depletion   and   amortization   and   no   assurance   can   be   given   that   actual   useful   lives   and   residual   values   will   not   differ   significantly  from  current  assumptions.   (c) Taxes   The   Company   is   subject   to   income   taxes   in   numerous   jurisdictions.     Significant   judgment   is   required   in   determining   the   provision  for  income  taxes,  due  to  the  complexity  of  legislation.    There  are  many  transactions  and  calculations  for  which   the  ultimate  tax  determination  is  uncertain  during  the  ordinary  course  of  business.       ii. Significant  Accounting  Estimates  and  Assumptions   The   areas   which   require   management   to   make   significant   estimates   and   assumptions   in   determining   carrying   values   include,  but  are  not  limited  to:   (a) Mineral  Reserves  and  Mineral  Resources   Proven   and   probable   mineral   reserves   are   the   economically   mineable   parts   of   the   Company’s   measured   and   indicated   mineral   resources   demonstrated   by   at   least   a   preliminary   feasibility   study.     The   Company   estimates   its   proven   and   probable  mineral  reserves  and  measured  and  indicated  and  inferred  mineral  resources  based  on  information  compiled  by   appropriately  qualified  persons.    The  estimation  of  future  cash  flows  related  to  proven  and  probable  mineral  reserves  is   based   upon   factors   such   as   estimates   of   foreign   exchange   rates,   commodity   prices,   future   capital   requirements   and   production  costs  along  with  geological  assumptions  and  judgments  made  in  estimating  the  size  and  grade  of  the  ore  body.     Changes  in  the  proven  and  probable  mineral  reserves  or  measured  and  indicated  and  inferred  mineral  resources  estimates   may   impact   the   carrying   value   of   property,   plant   and   equipment,   goodwill,   reclamation   and   remediation   obligations,   recognition  of  deferred  tax  amounts  and  depreciation,  depletion  and  amortization.       (b) Purchase  Price  Allocation     Applying  the  acquisition  method  to  business  combinations  requires  each  identifiable  asset  and  liability  to  be  measured  at   its  acquisition-­‐date  fair  value.    The  excess,  if  any,  of  the  fair  value  of  consideration  over  the  fair  value  of  the  net  identifiable   assets   acquired   is   recognized   as   goodwill.     The   determination   of   the   acquisition-­‐date   fair   values   often   requires   management   to   make   assumptions   and   estimates   about   future   events.     The   assumptions   and   estimates   relating   to   determining   the   fair   value   of   property,   plant   and   equipment   acquired   generally   require   a   high   degree   of   judgment,   and   include  estimates  of  mineral  reserves  acquired,  future  metal  prices  and  discount  rates.    Changes  in  any  of  the  assumptions   or   estimates   used   in   determining   the   fair   value   of   acquired   assets   and   liabilities   could   affect   the   amounts   assigned   to   assets,  liabilities  and  goodwill  in  the  purchase  price  allocation.   (c) Depreciation,  depletion  and  amortization   Plants   and   other   facilities   used   directly   in   mining   activities   are   depreciated   using   the   UOP   method   over   a   period   not   to   exceed  the  estimated  life  of  the  ore  body  based  on  recoverable  ounces  to  be  mined  from  proven  and  probable  reserves.     Mobile   and   other   equipment   is   depreciated,   net   of   residual   value,   on   a   straight-­‐line   basis,   over   the   useful   life   of   the   equipment  but  does  not  exceed  the  related  estimated  life  of  the  mine  based  on  proven  and  probable  reserves.   The   calculation   of   the   UOP   rate,   and   therefore   the   annual   depreciation,   depletion   and   amortization   expense,   could   be   materially   affected   by   changes   in   the   underlying   estimates.     Changes   in   estimates   can   be   the   result   of   actual   future   production   differing   from   current   forecasts   of   future   production,   expansion   of   mineral   reserves   through   exploration   activities,  differences  between  estimated  and  actual  costs  of  mining  and  differences  in  gold  price  used  in  the  estimation  of   mineral  reserves.   (d) Valuation  of  goodwill  and  long-­‐lived  assets   Goodwill  is  tested  for  impairment  annually  or  more  frequently  if  there  is  an  indication  of  impairment.    The  carrying  value  of   property,   plant   and   equipment   is   reviewed   each   reporting   period   to   determine   whether   there   is   any   indication   of   impairment   or   reversal   of   impairment.     If   the   carrying   amount   of   an   asset   exceeds   its   recoverable   amount,   the   asset   is   impaired   and   an   impairment   loss   is   recognized   in   the   consolidated   statement   of   operations.   For   property,   plant   and   equipment   and   other   long-­‐lived   assets,   a   reversal   of   previously   recognized   impairment   losses   is   recognized   in   the   consolidated  statement  of  operations  if  there  has  been  a  change  in  the  estimates  used  to  determine  the  asset’s     KINROSS ANNUAL REPORT 2017 FS 23       NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   recoverable  amount  since  the  last  impairment  loss  was  recognized.  The  assessment  of  fair  values,  including  those  of  the   CGUs  for  purposes  of  testing  goodwill  and  long-­‐lived  assets,  require  the  use  of  estimates  and  assumptions  for  recoverable   production,  future  and  long-­‐term  commodity  prices,  discount  rates,  NAV  multiples,  foreign  exchange  rates,  future  capital   requirements  and  operating  performance.    Changes  in  any  of  the  assumptions  or  estimates  used  in  determining  the  fair   value  of  goodwill  or  other  long-­‐lived  assets  could  impact  the  impairment  analysis.       (e) Inventories   Expenditures  incurred,  and  depreciation,  depletion  and  amortization  of  assets  used  in  mining  and  processing  activities  are   deferred  and  accumulated  as  the  cost  of  ore  in  stockpiles,  ore  on  leach  pads,  in-­‐process  and  finished  metal  inventories.     These  deferred  amounts  are  carried  at  the  lower  of  average  cost  or  NRV.    Write-­‐downs  of  ore  in  stockpiles,  ore  on  leach   pads,  in-­‐process  and  finished  metal  inventories  resulting  from  NRV  impairments  are  reported  as  a  component  of  current   period  costs.    The  primary  factors  that  influence  the  need  to  record  write-­‐downs  include  prevailing  and  long-­‐term  metal   prices  and  prevailing  costs  for  production  inputs  such  as  labour,  fuel  and  energy,  materials  and  supplies,  as  well  as  realized   ore  grades  and  actual  production  levels.       Costs   are   attributed   to   the   leach   pads   based   on   current   mining   costs,   including   applicable   depreciation,   depletion   and   amortization  relating  to  mining  operations  incurred  up  to  the  point  of  placing  the  ore  on  the  pad.    Costs  are  removed  from   the   leach   pad   based   on   the   average   cost   per   recoverable   ounce   of   gold   on   the   leach   pad   as   the   gold   is   recovered.     Estimates  of  recoverable  gold  on  the  leach  pads  are  calculated  from  the  quantities  of  ore  placed  on  the  pads,  the  grade  of   ore   placed   on   the   leach   pads   and   an   estimated   percentage   of   recovery.     Timing   and   ultimate   actual   recovery   of   gold   contained  on  leach  pads  can  vary  significantly  from  the  estimates.    The  quantities  of  recoverable  gold  placed  on  the  leach   pads  are  reconciled  to  the  quantities  of  gold  actually  recovered  (metallurgical  balancing),  by  comparing  the  grades  of  ore   placed  on  the  leach  pads  to  actual  ounces  recovered.    The  nature  of  the  leaching  process  inherently  limits  the  ability  to   precisely   monitor   inventory   levels.     As   a   result,   the   metallurgical   balancing   process   is   constantly   monitored   and   the   engineering  estimates  are  refined  based  on  actual  results  over  time.    The  ultimate  actual  recovery  of  gold  from  a  pad  will   not  be  known  until  the  leaching  process  is  completed.       The   allocation   of   costs   to   ore   in   stockpiles,   ore   on   leach   pads   and   in-­‐process   inventories   and   the   determination   of   NRV   involve   the   use   of   estimates.     There   is   a   high   degree   of   judgment   in   estimating   future   costs,   future   production   levels,   forecasted  usage  of  supplies  inventory,  proven  and  probable  reserves  estimates,  gold  and  silver  prices,  and  the  ultimate   estimated  recovery  for  ore  on  leach  pads.    There  can  be  no  assurance  that  actual  results  will  not  differ  significantly  from   estimates  used  in  the  determination  of  the  carrying  value  of  inventories.   (f) Provision  for  reclamation  and  remediation     The  Company  assesses  its  provision  for  reclamation  and  remediation  on  an  annual  basis  or  when  new  material  information   becomes  available.    Mining  and  exploration  activities  are  subject  to  various  laws  and  regulations  governing  the  protection   of   the   environment.     In   general,   these   laws   and   regulations   are   continually   changing   and   the   Company   has   made,   and   intends   to   make   in   the   future,   expenditures   to   comply   with   such   laws   and   regulations.     Accounting   for   reclamation   and   remediation  obligations  requires  management  to  make  estimates  of  the  future  costs  the  Company  will  incur  to  complete   the   reclamation   and   remediation   work   required   to   comply   with   existing   laws   and   regulations   at   each   mining   operation.     Actual   costs   incurred   may   differ   from   those   amounts   estimated.     Also,   future   changes   to   environmental   laws   and   regulations   could   increase   the   extent   of   reclamation   and   remediation   work   required   to   be   performed   by   the   Company.     Increases  in  future  costs  could  materially  impact  the  amounts  charged  to  operations  for  reclamation  and  remediation.    The   provision   represents   management’s   best   estimate   of   the   present   value   of   the   future   reclamation   and   remediation   obligation.    The  actual  future  expenditures  may  differ  from  the  amounts  currently  provided.       (g) Deferred  taxes   The   Company   recognizes   the   deferred   tax   benefit   related   to   deferred   income   and   resource   tax   assets   to   the   extent   recovery  is  probable.    Assessing  the  recoverability  of  deferred  income  tax  assets  requires  management  to  make  estimates   of   future   taxable   profit.     To   the   extent   that   future   cash   flows   and   taxable   profit   differ   significantly   from   estimates,   the   ability   of   the   Company   to   realize   the   net   deferred   tax   assets   recorded   at   the   balance   sheet   date   could   be   impacted.     In   addition,  future  changes  in  tax  laws  could  limit  the  ability  of  the  Company  to  obtain  tax  deductions  in  future  periods  from   deferred  income  and  resource  tax  assets.   KINROSS ANNUAL REPORT 2017 FS 24         NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   (h) Contingencies   Due  to  the  size,  complexity  and  nature  of  the  Company’s  operations,  various  legal  and  tax  matters  are  outstanding  from   time  to  time.    Contingencies  can  be  possible  assets  or  liabilities  arising  from  past  events  which,  by  their  nature,  will  only  be   resolved   when   one   or   more   future   events   not   wholly   within   our   control   occur   or   fail   to   occur.     The   assessment   of   such   contingencies   involves   the   use   of   significant   judgment   and   estimates.     In   the   event   that   management’s   estimate   of   the   future   resolution   of   these   matters   changes,   the   Company   will   recognize   the   effects   of   the   changes   in   its   consolidated   financial  statements  on  the  date  such  changes  occur.       6. i. ACQUISITIONS  AND  DISPOSITIONS   Disposition  of  interest  in  Cerro  Casale   On  March  28,  2017,  the  Company  announced  that  it  had  entered  into  an  agreement  with  Goldcorp  Inc.    (“Goldcorp”)  to  sell   its  25%  interest  in  the  Cerro  Casale  project  and  its  100%  interest  in  the  Quebrada  Seca  exploration  project  in  Chile.       On  June  9,  2017,  the  Company  completed  the  sale  for  gross  cash  proceeds  of  $260.0  million  (which  includes  $20.0  million   for   Quebrada   Seca),   a   contingent   payment   of   $40.0   million   following   a   construction   decision   for   Cerro   Casale,   the   assumption   by   Goldcorp   of   a   $20.0   million   contingent   payment   obligation   payable   to   Barrick   Gold   Corporation   when   production   at   Cerro   Casale   commences,   and   a   1.25%   royalty   on   25%   of   gross   revenues   from   all   metals   sold   at   the   properties  (with  the  Company  foregoing  the  first  $10.0  million).    Additionally  on  closing,  the  Company  entered  into  a  water   supply   agreement   with   the   Cerro   Casale   joint   venture   to   have   certain   rights   to   access,   up   to   a   fixed   amount,   water   not   required  by  the  Cerro  Casale  joint  venture.   In  connection  with  the  sale,  the  Company  recognized,  in  other  income  (expense),  an  impairment  reversal  of  $97.0  million   related  to  its  investment  in  Cerro  Casale,  and  a  gain  on  disposition  of  $12.7  million.    See  Note  7  xi.   ii. Disposition  of  interest  in  White  Gold   On  May  18,  2017,  the  Company  entered  into  an  agreement  with  White  Gold  Corp.  to  sell  its  100%  interest  in  the  White   Gold  exploration  project  in  the  Yukon  Territory.   On  June  14,  2017,  the  Company  completed  the  sale  for  gross  cash  proceeds  of  $7.6  million  (CDN$10.0  million),  17.5  million   common  shares  of  White  Gold  Corp.   representing  19.9%  of  the  issued  and  outstanding  shares  of  White  Gold  Corp.,  and   deferred  payments  of  $11.4  million  (CDN$15.0  million),  payable  in  three  equal  payments  of  $3.8  million  (CDN$5.0  million)   upon   completion   of   specific   milestones.     The   Company   recognized   a   loss   on   disposition   of   $1.7   million   in   other   income   (expense)  in  connection  with  the  sale.    See  Note  7  xi.   The   investment   in   White   Gold   Corp.   has   been   accounted   for   as   an   available-­‐for-­‐sale   investment   as   the   Company   determined  it  does  not  have  significant  influence  over  White  Gold  Corp.   iii. Disposition  of  interest  in  DeLamar On  September  18,  2017,  the  Company  entered  into  an  agreement  with  Integra  Resources  Corp.    (“Integra”)  to  sell  its  100%   interest  in  the  DeLamar  reclamation  property.   On   November   3,   2017,   the   Company   completed   the   sale   for   cash   consideration   and   a   non-­‐interest   bearing   promissory   note,  payable  18  months  after  closing,  totaling  $5.6  million  (CDN$7.2  million),  common  shares  representing  9.9%  of  the   issued  and  outstanding  shares  of  Integra,  and  a  2.5%  net  smelter  return  royalty  that  will  be  reduced  to  1%  when  royalty   payments  have  accumulated  to  $7.8  million  (CDN$10.0  million).    In  connection  with  the  sale,  the  Company  recognized  a   gain  on  disposition  of  $44.2  million  in  other  income  (expense).    See  Note  7  xi.   iv. Acquisition  of  La  Coipa  mining  concessions   Compania  Minera  de  Oro  (“MDO”),  a  subsidiary  of  the  Company,  currently  holds  a  50%  ownership  interest  in  the  Phase  7   deposit   through   its   50%   ownership   of   Minera   La   Coipa   (“MLC”),   with   the   remaining   50%   held   by   Salmones   de   Chile   Alimentos  S.A.  (“SDCA”).    Pursuant  to  an  agreement  signed  on  February  2,  2018,  MDO,  MLC  and  SDCA  have  agreed,  among     KINROSS ANNUAL REPORT 2017 FS 25               NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   other   things,   to   spin   out   the   Phase   7   concessions   into   a   new   company   and   MDO   has   agreed   to   purchase   SDCA’s   50%   interest  in  such  company  in  exchange  for  payments  to  SDCA  totaling  $65  million  ($35  million  on  closing  and  $30  million  on   or   before   January   31,   2019).     Following   completion   of   the   transaction,   MDO   will   have   a   100%   ownership   interest   in   the   Phase  7  deposit.  The  transaction  is  subject  to  certain  conditions  and  is  expected  to  close  within  90  days.   v. Acquisition  of  power  plants  in  Brazil   On  February  14,  2018,  Kinross  Brasil  Mineração  (“KBM”),  a  subsidiary  of  the  Company,  signed  an  agreement  to  acquire  two   hydroelectric  power  plants  in  the  State  of  Goias,  Brazil  from  a  subsidiary  of  Gerdau  SA  for  $257.0  million.  The  two  plants   are  expected  to  secure  a  long-­‐term  supply  of  power  and  lower  production  costs  over  the  life  of  the  mine  at  Paracatu.  The   transaction  is  subject  to  regulatory  approvals  and  is  expected  to  close  in  approximately  three  to  six  months.   KINROSS ANNUAL REPORT 2017 FS 26                                   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   7. CONSOLIDATED  FINANCIAL  STATEMENT  DETAILS   Consolidated  Balance  Sheets   i. Cash  and  cash  equivalents:   Cash  on  hand  and  balances  with  banks Short-­‐term  deposits                                    Restricted  cash:   Restricted  cash  (a) (a)  Restricted  cash  relates  to  loan  escrow  judicial  deposits  and  environmental  indemnities.       ii. Accounts  receivable  and  other  assets:   Trade  receivables   Prepaid  expenses VAT  receivable Deposits Other   iii. Inventories:   Ore  in  stockpiles  (a) Ore  on  leach  pads  (b) In-­‐process   Finished  metal   Materials  and  supplies Long-­‐term  portion  of  ore  in  stockpiles  and  ore  on  leach  pads  (a),(b) December  31, 2017 December  31, 2016 $                                           $                                           600.8 425.0 1,025.8 514.0 313.0 827.0 $                                     $                                           December  31, 2017 December  31, 2016 $                                               12.1 $                                                 11.6 December  31, 2017 December  31, 2016 $                                                     $                                                 $                                                 $                                             December  31, 2017 December  31,   2016 $                                               $                                               4.5 19.8 36.2 11.1 19.7 91.3 242.6 358.5 122.3 91.5 519.3 1,334.2 (239.9) 1,094.3 20.1 21.9 59.3 11.4 14.6 127.3 242.3 301.6 78.6 49.1 534.1 1,205.7 (218.9) 986.8 $                                         $                                               (a) Ore  in  stockpiles  relates  to  the  Company’s  operating  mines.    Ore  in  stockpiles  includes  low-­‐grade  material  not  scheduled  for  processing   within  the  next  twelve  months  which  is  included  in  other  long-­‐term  assets  on  the  consolidated  balance  sheet.    See  Note  7  vii.   (b) Ore  on  leach  pads  relates  to  the  Company's  Tasiast,  Fort   Knox,  Round  Mountain  and  Bald  Mountain  mines.    Based  on  current  mine   plans,  the  Company  expects  to  place  the  last  tonne  of  ore  on  its  leach  pads  at  Tasiast  in  2018,  Fort  Knox  in  2021,  Bald  Mountain  in  2023   and  Round  Mountain  in  2024.    Ore  on  leach  pads  includes  material  not  scheduled  for  processing  within  the  next  twelve  months  which  is   included  in  other  long-­‐term  assets  on  the  consolidated  balance  sheet.    See  Note  7  vii.   (c) During  the  year  ended  December  31,  2016,  inventory  impairment  charges  of  $71.3  million  were  recorded  within  cost  of  sales  to  reduce   the  carrying  value  of  inventory  to  its  net  realizable  value.    See  Note  8  ii.   KINROSS ANNUAL REPORT 2017 FS 27                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   iv. Property,  plant  and  equipment:   Cost Balance  at  January  1,  2017 Additions Capitalized  interest   Disposals Other Balance  at  December  31,  2017 Mineral  Interests  (a) Land,  plant  and   equipment   Development  and   operating   properties Pre-­‐development   properties $                                       7,791.3 626.9 13.8 (44.5) (12.8) 8,374.7 $                                       7,970.2 298.5 11.3 -­‐ 31.5 8,311.5 $                                             164.3 -­‐ -­‐ (133.2) (15.6) 15.5 Accumulated  depreciation,  depletion,  amortization   and  impairment Balance  at  January  1,  2017 Depreciation,  depletion  and  amortization Impairment,  net  of  reversals  (b) Disposals   Other Balance  at  December  31,  2017 $                                   (5,076.4) (529.3) 260.9 38.8 (2.4) (5,308.4) $                                   (5,852.4) (371.5) (282.4) -­‐ 0.2 (6,506.1) $                                               (79.4) -­‐ -­‐ 79.2 0.2 -­‐ Total $                                 15,925.8 925.4 25.1 (177.7) 3.1 16,701.7 $                               (11,008.2) (900.8) (21.5) 118.0 (2.0) (11,814.5) Net  book  value $                                       3,066.3 $                                       1,805.4 $                                                 15.5 $                                       4,887.2 Amount  included  above  as  at  December  31,  2017: Assets  under  construction Assets  not  being  depreciated  (c) $                                             $                                             534.2 723.3 $                                             $                                             116.4 342.8 $                                                         -­‐ $                                                 15.5 $                                             $                                       650.6 1,081.6 (a) At   December   31,   2017,   the   significant   development   and   operating   properties   include   Fort   Knox,   Round   Mountain,   Bald   Mountain,   Paracatu,  Kupol,  Tasiast,  Chirano  and  Lobo-­‐Marte.   (b) At  December  31,  2017,  an  impairment  charge  was  recorded  at  Paracatu  and  impairment  reversals  were  recorded  at  Fort  Knox  and   Tasiast,  entirely  related  to  property,  plant  and  equipment.  See  Note  8  i.   (c) Assets  not  being  depreciated  relate  to  land,  capitalized  exploration  and  evaluation  costs,  assets  under  construction,  which  relate  to   expansion  projects,  and  other  assets  that  are  in  various  stages  of  being  readied  for  use.   KINROSS ANNUAL REPORT 2017 FS 28                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Mineral  Interests  (a) Land,  plant  and   equipment Development  and   operating   properties Pre-­‐development   properties Total $                                       7,332.2 445.6 417.4 $                                       7,651.4 207.7 400.1 $                                             164.3 -­‐ -­‐ $                                 15,147.9 653.3 817.5 (359.4) 10.4 (57.8) 2.9 7,791.3 (294.7) 4.8 (0.7) 1.6 7,970.2 -­‐ -­‐ -­‐ -­‐ 164.3 (654.1) 15.2 (58.5) 4.5 15,925.8 Cost Balance  at  January  1,  2016 Additions Acquisitions  (b) Book  value  of  Round  Mountain  prior  to   remeasurement  on  acquisition Capitalized  interest   Disposals Other Balance  at  December  31,  2016 Accumulated  depreciation,  depletion,  amortization   and  impairment Balance  at  January  1,  2016 $                                   (4,835.1) $                                   (5,639.7) $                                               (79.4) $                               (10,554.2) Depreciation,  depletion  and  amortization Impairment,  net  of  reversals  (c) Book  value  of  Round  Mountain  prior  to   remeasurement  on  acquisition Disposals Other Balance  at  December  31,  2016 (528.1) (68.3) 305.4 50.4 (0.7) (5,076.4) (399.4) -­‐ 187.6 -­‐ (0.9) (5,852.4) -­‐ -­‐ -­‐ -­‐ -­‐ (79.4) (927.5) (68.3) 493.0 50.4 (1.6) (11,008.2) Net  book  value $                                       2,714.9 $                                       2,117.8 $                                                 84.9 $                                       4,917.6 Amount  included  above  as  at  December  31,  2016: Assets  under  construction Assets  not  being  depreciated  (d) $                                             $                                             373.5 545.3 $                                             $                                             119.4 322.3 $                                                         -­‐ $                                                 84.9 $                                             $                                             492.9 952.5 (a) At   December   31,   2016,   the   significant   development   and   operating   properties   include   Fort   Knox,   Round   Mountain,   Bald   Mountain,   Paracatu,   Kupol,   Tasiast,   Chirano   and   Lobo-­‐Marte.     Included   in   pre-­‐development   properties   are   White   Gold   and   other   exploration   properties.   (b) Bald  Mountain  and  the  remaining  50%  interest  in  Round  Mountain  were  acquired  on  January  11,  2016.       (c) At  September  30,  2016,  an  impairment  charge  was  recorded  against  property,  plant  and  equipment  at  Maricunga.    See  Note  8  i.   (d) Assets  not  being  depreciated  relate  to  land,  capitalized  exploration  and  evaluation  costs,  assets  under  construction,  which  relate  to   expansion  projects,  and  other  assets  that  are  in  various  stages  of  being  readied  for  use.   Capitalized  interest  primarily  relates  to  qualifying  capital  expenditures  at  Fort  Knox,  Round  Mountain,  Kupol,  Paracatu,  and   Tasiast   and   had   a   weighted   average   borrowing   rate   of   5.54%   and   4.9%   during   the   years   ended   December   31,   2017   and   2016,  respectively.   At   December   31,   2017,   $164.4   million   of   exploration   and   evaluation   (“E&E”)   assets   were   included   in   mineral   interests   (December  31,  2016  –  $216.8  million).    During  the  year  ended  December  31,  2017,  the  Company  acquired  $nil  E&E  assets,   disposed   of   $54.1   million   E&E   assets   and   transferred   $0.2   million   E&E   assets   to   capitalized   development   (year   ended   December  31,  2016  –  $nil,  $nil  and  $nil,  respectively).    During  the  year  ended  December  31,  2017,  the  Company  capitalized   $1.9  million  and  expensed  $6.7  million  of  E&E  costs,  respectively  (year  ended  December  31,  2016  –  $1.2  million  and  $6.8   million,  respectively).    Expensed  E&E  costs  are  included  in  operating  cash  flows.   KINROSS ANNUAL REPORT 2017 FS 29                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   v. Goodwill:   As  at  December  31,  2017  and  December  31,  2016,  goodwill  of  $162.7  million  is  comprised  of  goodwill  for  Kupol  of  $158.8   million   (net   of   accumulated   impairment   of   $668.4   million)   and   for   other   operations   of   $3.9   million   (net   of   accumulated   impairment  of  $nil).     vi. Long-­‐term  investments:   Unrealized  gains  and  losses  on  investments  classified  as  available-­‐for-­‐sale  are  recorded  in  AOCI  as  follows:   December  31,  2017 December  31,  2016 Investments  in  an  unrealized  gain  position Investments  in  an  unrealized  loss  position vii. Other  long-­‐term  assets:   Fair  value 125.1 62.9 188.0 $                                       $                                       Gains  (losses)  in   AOCI 26.6 (19.7) 6.9 $                                               $                                           Fair  value Gains  (losses)  in   AOCI  $                                      110.2    $                                          30.3                                                    (6.7)                                                32.7   $                                           23.6 $                                       142.9 December  31, 2017 December  31, 2016 $                                             $                                             Long-­‐term  portion  of  ore  in  stockpiles  and  ore  on  leach  pads  (a) Deferred  charges,  net  of  amortization Long-­‐term  receivables  (b) Advances  for  the  purchase  of  capital  equipment Other $                                             $                                             (a) Ore  in  stockpiles  and  on  leach  pads  represents  low-­‐grade  material  not  scheduled  for  processing  within  the  next  twelve  months.    At   December  31,  2017,  long-­‐term  ore  in  stockpiles  was  at  the  Company’s  Fort  Knox,  Kupol,  Tasiast,  Chirano  and  Paracatu  mines,  and   long-­‐term  ore  on  leach  pads  was  at  the  Company’s  Fort  Knox,  Round  Mountain,  and  Tasiast  mines.   (b) Long-­‐term  receivables  includes  an  estimated  benefit  of  $124.4  million  related  to  the  enactment  of  U.S.  Tax  Reform  legislation  in   December  2017.  See  Note  17.   viii.  Accounts  payable  and  accrued  liabilities:     December  31, 2017 December  31, 2016 239.9 8.9 272.8 6.4 46.0 574.0 77.4 274.2 131.0 482.6 Trade  payables   Accrued  liabilities Employee  related  accrued  liabilities ix. Accumulated  other  comprehensive  income:     Balance  at  December  31,  2015 Other  comprehensive  income  before  tax Tax Balance  at  December  31,  2016 Other  comprehensive  loss  before  tax Tax Balance  at  December  31,  2017 KINROSS ANNUAL REPORT 2017 FS 30 $                                                 $                                                 $                                             $                                             $                                               $                                               $                                               $                                                 $                                                 $                                                 Long-­‐term   Investments   (18.7) 42.3 -­‐ 23.6 (16.4) (0.3) Derivative   Contracts   (12.6) 37.6 (9.5) 15.5 (2.4) 1.1 $                                                     6.9 $                                                 14.2 $                                                 21.1 218.9 8.6 147.2 2.8 33.8 411.3 86.8 251.4 126.6 464.8 Total (31.3) 79.9 (9.5) 39.1 (18.8) 0.8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidated  Statements  of  Operations x.  Other  operating  expense:   Other  operating  expense Years  ended  December  31, 2017 2016 $                                           $                                           $                                             $                                             129.6 129.6 209.3 209.3 Other   operating   expense   for   the   year   ended   December   31,   2017   includes   the   write-­‐off   of   value-­‐added   tax   (“VAT”)   receivables   and   settlement   of   VAT   disputes,   costs   related   to   the   temporary   curtailment   of   mining   activities   at   Paracatu,   costs  related  to  the  Fort  Knox  Gilmore  Feasibility  study,  reclamation  expenses  related  to  properties  where  mining  activities   have  ceased  or  are  in  reclamation,  and  care  and  maintenance  and  other  costs.     Other  operating  expense  for  the  year  ended  December  31,  2016  includes  the  write-­‐off  of  VAT  receivables  and  settlement   of  VAT  disputes  due  to  regulatory  changes  in  Brazil,  costs  related  to  the  suspension  of  mining  activities  at  Maricunga  and   Tasiast,  reclamation  expenses  related  to  properties  where  mining  activities  have  ceased  or  are  in  reclamation,  and  care  and   maintenance  and  other  costs.   xi.  Other  income  (expense)    –  net:       Gain  on  disposition  of  associate  and  other  interests  -­‐  net (a) Gain  on  disposition  of  other  assets  -­‐  net Reversal  of  impairment  charges  (b) Foreign  exchange  losses Net  non-­‐hedge  derivative  gains  (losses) Other  (c) Years  ended  December  31, 2017 2016 $                                                 55.2 1.9 97.0 (4.9) 0.3 38.6 188.1 -­‐ $                                                         9.7 -­‐ (6.3) (0.4) 19.5 22.5 $                                                 $                                             (a) During  the  year  ended  December  31,  2017,  the  Company  recognized  a  gain  on  disposition  of  its  interests  in  Cerro  Casale  and   Quebrada  Seca  of  $12.7  million,  a  loss  on  disposition  of  its  interest  in  White  Gold  of  $1.7  million,  and  a  gain  on  disposition  of  its   interest  in  DeLamar  of  $44.2  million.    See  Note  6.   (b) During  the  year  ended  December  31,  2017,  the  Company  recognized  a  reversal  of  impairment  charges  related  to  the  sale  of  its   interest  in  Cerro  Casale.    See  Note  6  i.   (c) Other  includes  insurance  recoveries  of  $17.5  million  and  $9.9  million  related  to  a  settlement  of  a  royalty  agreement.   xii. Finance  expense: Accretion  on  reclamation  and  remediation  obligations Interest  expense,  including  accretion  on  debt  (a) Years  ended  December  31, 2017 2016 $                                             $                                               (31.3) (86.5) (117.8) (34.2) (100.4) (134.6) $                                         $                                           (a) During   the   years   ended   December   31,   2017   and   2016,   $25.1   million   and   $15.2   million,   respectively,   of   interest   was   capitalized   to   property,  plant  and  equipment.    See  Note  7  iv.   Total  interest  paid,  including  interest  capitalized,  during  the  year  ended  December  31,  2017  was  $80.9  million  (year  ended   December  31,  2016  -­‐  $95.3  million).   KINROSS ANNUAL REPORT 2017 FS 31                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   xiii. Employee  benefits  expenses:   The   following   employee   benefits   expenses   are   included   in   production   cost   of   sales,   general   and   administrative,   and   exploration  and  business  development  expenses:   Years  ended  December  31, 2017 2016 Salaries,  short-­‐term  incentives,  and  other  benefits Share-­‐based  payments Other   8. IMPAIRMENT,  NET  OF  REVERSALS   Property,  plant  and  equipment  (i) Inventory  and  other  assets  (ii) i. Property,  plant  and  equipment   $                                             $                                             678.5 25.9 11.2 715.6 665.7 26.8 19.2 711.7 $                                             $                                             Years  ended  December  31, 2017 2016 $                                                       $                                                 21.5 -­‐ 21.5 68.3 71.3 139.6 $                                                       $                                             At   December   31,   2017,   upon   completion   of   the   annual   assessment   of   the   carrying   values   of   its   CGUs,   the   Company   recorded   a   net   impairment   charge   of   $21.5   million.     The   impairment   charge   was   entirely   related   to   property,   plant   and   equipment  and  included  an  impairment  charge  of  $253.0  million  at  Paracatu,  partially  offset  by  impairment  reversals   at   Tasiast  and  Fort  Knox  of  $142.9  million  and  $88.6  million,  respectively.  The  impairment  reversals  at  Tasiast  and  Fort  Knox   were  mainly  due  to  an  increase  in  the  Company’s  short-­‐term  and  long-­‐term  gold  price  estimates,  as  well  as  Tasiast  Phase   Two  progressing  as  planned  and  additions  to  Fort  Knox’s  mineral  reserve  estimates.  For  Tasiast,  the  reversal  represents  a   partial  reversal  of  the  total  impairment  charges  previously  recorded.  For  Fort  Knox,  the  reversal  represents  a  full  reversal  of   the  remaining  impairment  charge  recorded  in  2015.    The  impairment  charge  at  Paracatu  was  mainly  a  result  of  changes  in   the  fiscal  regime  in  Brazil  that  were  considered  in  the  cash  flow  analysis  used  to  assess  its  recoverable  amount.    The  tax   impact  on  the  impairment  reversal  at  Paracatu  was  a  recovery  of  $86.0  million.    The  tax  impact  on  the  impairment  reversal   at  Fort  Knox  was  an  expense  of  $2.4  million.    There  was  no  tax  impact  on  the  impairment  reversal  at  Tasiast.    The  net  tax   recovery   of   $83.6   million   was   recorded   within   income   tax   expense.     After   giving   effect   to   the   impairment   charge   and   impairment  reversals,  the  carrying  values  of  Paracatu,  Tasiast,  and  Fort  Knox  were  $1,275.6  million,  $1,417.5  million,  and   $420.2  million,  respectively,  as  at  December  31,  2017.  The  significant  estimates  and  assumptions  used  in  the  impairment   assessment  are  disclosed  in  Note  3  to  the  financial  statements.   As  at  September  30,  2016,  the  Company  identified  the  suspension  of  mining  at  Maricunga  as  an  indication  of  impairment   and  performed  an  impairment  assessment  to  determine  the  recoverable  amount  of  the  Maricunga  CGU.    The  recoverable   amount  was  determined  by  considering  observable  market  values  for  comparable  assets.    As  the  recoverable  amount  was   lower   than   the   carrying   amount,   an   impairment   charge   of   $68.3   million   was   recorded   against   property,   plant   and   equipment,  resulting  in  a  carrying  amount  of  $(10.9)  million  for  the  Maricunga  CGU.    The  carrying  amount  was  negative  as   a   result   of   reclamation   and   remediation   obligations.     No   impairment   charges   were   recorded   as   a   result   of   the   annual   assessment  of  the  carrying  value  of  the  Company’s  CGUs  at  December  31,  2016.   Key  assumptions  and  sensitivity   The  significant  estimates  and  assumptions  used  in  the  Company’s  annual  impairment  assessments  are  disclosed  in  Note  3   to  the  financial  statements.    The  Company  performed  a  sensitivity  analysis  on  all  key  assumptions  and  determined  that  no   reasonably  possible  change  in  any  of  the  key  assumptions  would  cause  the  carrying  value  of  any  CGU  carrying  goodwill  to   exceed  its  recoverable  amount.   KINROSS ANNUAL REPORT 2017 FS 32                                                                                                                                                                                                                                                                                                                                                                 NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   ii. Inventory  and  other  assets   In   2016,   the   Company   recognized   impairment   charges   of   $71.3   million   related   to   metals   and   supplies   inventory   at   Maricunga,  resulting  from  the  suspension  of  mining  during  the  year.       9. INVESTMENTS  IN  ASSOCIATE  AND  JOINT  VENTURES   The  investments  in  associate  and  joint  ventures  are  accounted  for  under  the  equity  method  and  had  the  following  carrying   values:   Cerro  Casale  (a) Puren        Bald  Mountain  Exploration  Joint  Venture  (b) December  31, 2017 $                                                         -­‐ 18.2 5.5 23.7 $                                                 December  31, 2016 $                                             $                                             139.5 18.6 5.5 163.6 (a) On  June  9,  2017,  the  Company  completed  the  sale  of  its  interest  in  the  Cerro  Casale  project  in  Chile  to  Goldcorp  Inc.    See  Note  6i.   (b) As   part   of   the   Company’s   acquisition   of   Bald   Mountain   on   January   11,   2016,   it   acquired   an   associated   land   package,   of   which   approximately  40%  is  subject  to  a  50/50  joint  venture  between  the  Company  and  Barrick.       There  are  no  publicly  quoted  market  prices  for  Puren  or  the  Bald  Mountain  Exploration  Joint  Venture.   The  equity  in  losses  of  associate  and  joint  ventures  is  as  follows:   Years  ended  December  31, 2017 2016 Cerro  Casale  (a),  (b) Puren  (a) Bald  Mountain  Exploration  Joint  Venture  (a) $                                                   $                                                   (0.5) (0.1) (0.7) (1.3) (0.6) (0.2) (0.4) (1.2) $                                                   $                                                   (a) Represents  Kinross’  share  of  the  net  earnings  (loss)  and  other  comprehensive  income  (loss).   (b) On  June  9,  2017,  the  Company  completed  the  sale  of  its  interest  in  Cerro  Casale  project  in  Chile  to  Goldcorp  Inc.    See  Note  6i.   KINROSS ANNUAL REPORT 2017 FS 33                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   10. (a) FAIR  VALUE  MEASUREMENT Recurring  fair  value  measurement:   Carrying   values   for   financial   instruments,   including   cash   and   cash   equivalents,   short-­‐term   investments,   accounts   receivable,  and  accounts  payable  and  accrued  liabilities  approximate  fair  values  due  to  their  short-­‐term  maturities.       Fair  value  estimates  for  derivative  contracts  are  based  on  quoted  market  prices  for  comparable  contracts  and  represent   the  amount  the  Company  would  have  received  from,  or  paid  to,  a  counterparty  to  unwind  the  contract  at  the  market  rates   in  effect  at  the  consolidated  balance  sheet  date.       The   Company   categorizes   each   of   its   fair   value   measurements   in   accordance   with   a   fair   value   hierarchy.     The   fair   value   hierarchy  establishes  three  levels  to  classify  the  inputs  to  valuation  techniques  used  to  measure  fair  value.    Level  1  inputs   are   quoted   prices   (unadjusted)   in   active   markets   for   identical   assets   or   liabilities.     Level   2   inputs   are   quoted   prices   in   markets  that  are  not  active,  quoted  prices  for  similar  assets  or  liabilities  in  active  markets,  inputs  other  than  quoted  prices   that  are  observable  for  the  asset  or  liability  (for  example,  interest  rate  and  yield  curves  observable  at  commonly  quoted   intervals,   forward   pricing   curves   used   to   value   currency   and   commodity   contracts   and   volatility   measurements   used   to   value   option   contracts),   or   inputs   that   are   derived   principally   from   or   corroborated   by   observable   market   data   or   other   means.     Level   3   inputs   are   unobservable   (supported   by   little   or   no   market   activity).     The   fair   value   hierarchy   gives   the   highest  priority  to  Level  1  inputs  and  the  lowest  priority  to  Level  3  inputs.   For  financial  instruments  that  are  recognized  at  fair  value  on  a  recurring  basis,  the  Company  determines  whether  transfers   have  occurred  between  levels  in  the  hierarchy  by  re-­‐assessing  their  classification  (based  on  the  lowest  level  input  that  is   significant  to  the  fair  value  measurement  as  a  whole)  at  the  end  of  each  reporting  period.   Assets  (liabilities)  measured  at  fair  value  on  a  recurring  basis  as  at  December  31,  2017  include:   Available-­‐for-­‐sale  investments Derivative  contracts: Foreign  currency  forward  and  collar  contracts Energy  swap  contracts Total  return  swap  contracts $                                             Level  1 188.0 Level  2 $                                                         -­‐ Level  3 $                                                         -­‐ Aggregate   Fair  Value 188.0 $                                                                                                            -­‐                                                                    -­‐                                                                    -­‐      $                                          188.0   6.1 12.9 0.6  $                                              19.6   -­‐ -­‐ -­‐ $                                                         -­‐ 6.1 12.9 0.6  $                                          207.6     During  the  year  ended  December  31,  2017,  there  were  no  transfers  between  Level  1  and  Level  2  fair  value  measurements,   and  no  transfers  into  or  out  of  Level  3  fair  value  measurements.   The  valuation  techniques  that  are  used  to  measure  fair  value  are  as  follows:   Available-­‐for-­‐sale  investments:   The  fair  value  of  available-­‐for-­‐sale  investments  is  determined  based  on  a  market  approach  reflecting  the  closing  price  of   each  particular  security  at  the  consolidated  balance  sheet  date.    The  closing  price  is  a  quoted  market  price  obtained  from   the  exchange  that  is  the  principal  active  market  for  the  particular  security,  and  therefore  available-­‐for-­‐sale  investments  are   classified  within  Level  1  of  the  fair  value  hierarchy.   Derivative  contracts:   The   Company’s   derivative   contracts   are   valued   using   pricing   models   and   the   Company   generally   uses   similar   models   to   value  similar  instruments.    Such  pricing  models  require  a  variety  of  inputs,  including  contractual  cash  flows,  quoted  market   prices,  applicable  yield  curves  and  credit  spreads.    The  fair  value  of  derivative  contracts  is  based  on  quoted  market  prices   for  comparable  contracts  and  represents  the  amount  the  Company  would  have  received  from,  or  paid  to,  a  counterparty  to   unwind  the  contract  at  the  quoted  market  rates  in  effect  at  the  consolidated  balance  sheet  date  and  therefore  derivative   contracts  are  classified  within  Level  2  of  the  fair  value  hierarchy.       KINROSS ANNUAL REPORT 2017 FS 34                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   The  following  table  summarizes  information  about  derivative  contracts  outstanding  at  December  31,  2017  and  2016:     Currency  contracts      Foreign  currency  forward  and  collar        contracts  (a)  (i) Commodity  contracts      Energy  swap  contracts  (b)  (ii) Other  contracts      Total  return  swap  contracts  (iii) December  31,  2017 December  31,  2016 Asset  /  (Liability) Fair  Value Asset  /  (Liability) Fair  Value AOCI AOCI 6.1 12.9 0.6 4.4                                                          8.9                                                            5.9   9.8                                                      12.3   -­‐                                                        (6.2) 9.6 -­‐ Total  all  contracts  $                                              19.6    $                                              14.2    $                                                15.0    $                                                15.5   Unrealized  fair  value  of  derivative  assets      Current      Non-­‐current Unrealized  fair  value  of  derivative  liabilities      Current      Non-­‐current Total  net  fair  value 17.0                                                          3.9    $                                              20.9                                                        (1.1)                                                      (0.2)  $                                                (1.3)  $                                              19.6   16.1                                                          6.0    $                                                22.1                                                          (7.1)                                                                -­‐      $                                                (7.1)  $                                                15.0   (a) Of  the  total  amount  recorded  in  AOCI  at  December  31,  2017,  $4.2  million  will  be  reclassified  to  net  earnings  within  the  next  12  months   as  a  result  of  settling  the  contracts.   (b) Of  the  total  amount  recorded  in  AOCI  at  December  31,  2017,  $7.3  million  will  be  reclassified  to  net  earnings  within  the  next  12  months   as  a  result  of  settling  the  contracts.   KINROSS ANNUAL REPORT 2017 FS 35                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   (i) Foreign  currency  forward  and  collar  contracts   The  following  table  provides  a  summary  of  foreign  currency  forward  and  collar  contracts  outstanding  at  December  31,   2017,  maturing  in  2018  and  2019:   Foreign  currency Brazilian  real  forward  buy  contracts (in  millions  of  U.S.  dollars) Average  price  (Brazilian  reais) Brazilian  real  zero  cost  collars (in  millions  of  U.S.  dollars) Average  put  strike  (Brazilian  reais) Average  call  strike  (Brazilian  reais) Canadian  dollar  forward  buy  contracts (in  millions  of  U.S.  dollars) Average  rate  (Canadian  dollars) Russian  rouble  zero  cost  collars (in  millions  of  U.S.  dollars) Average  put  strike  (Russian  roubles) Average  call  strike  (Russian  roubles) 2018 2019 2020 $                                 69.6 3.32 -­‐ $                                         -­‐ -­‐ $                                         -­‐ $                                 25.2 3.75 4.12 $                                 60.0 3.45 3.64 -­‐ $                                         -­‐ -­‐ $                                 40.5 1.35 $                                 18.0 1.28 $                                         -­‐ -­‐ $                                 24.0 60.0 71.2 -­‐ $                                     -­‐ -­‐ -­‐ $                                         -­‐ -­‐ During  2017,  the  Company  entered  into  the  following  new  forward  buy  and  zero  cost  collar  derivative  contracts:   • • • • $58.5  million  Canadian  dollars  at  an  average  rate  of  1.33  maturing  in  2018  to  2019;   $24.0  million  Russian  roubles  with  an  average  put  strike  of  60.00  and  an  average  call  strike  of  71.24  maturing  in  2018;     $69.6  million  Brazilian  reais  at  an  average  rate  of  3.32  maturing  in  2018;  and   $60.0  million  Brazilian  reais  with  an  average  put  strike  of  3.45  and  an  average  call  strike  of  3.64  maturing  in  2019.   At  December  31,  2017,  the  unrealized  gain  or  loss  on  the  derivative  contracts  recorded  in  AOCI  is  as  follows:   • • • • Brazilian  real  forward  buy  contracts  –  unrealized  loss  of  $0.7  million  (December  31,  2016  –  $nil);   Brazilian  real  zero  cost  collar  contracts  –  unrealized  gain  of  $1.8  million  (December  31,  2016  –  $6.0  million  gain);       Canadian  dollar  forward  buy  contracts  –  unrealized  gain  of  $2.6  million  (December  31,  2016  –  $0.2  million  loss);  and   Russian  rouble  zero  cost  collar  contracts  –  unrealized  gain  of  $0.7  million  (December  31,  2016  –  $0.1  million  gain).   (ii) Energy  swap  contracts   The  Company  is  exposed  to  changes  in  energy  prices  through  its  consumption  of  diesel  and  other  fuels,  and  the  price  of   electricity  in  some  electricity  supply  contracts.    The  Company  entered  into  energy  swap  contracts  that  protect  against  the   risk  of  fuel  price  increases.    Fuel  is  consumed  in  the  operation  of  mobile  equipment  and  electricity  generation.       The  following  table  provides  a  summary  of  energy  swap  contracts  outstanding  at  December  31,  2017,  maturing  in  2018  to   2020:   Energy WTI  oil  swap  contracts  (barrels) Average  price 2018 2019 2020 907,482 48.48 $                             594,451 49.86 $                             90,000 52.40 $                             During  2017,  the  following  new  commodity  derivative  contracts  were  entered  into:   • 1,048,000  barrels  of  WTI  oil  at  an  average  rate  of  $49.46  per  barrel  maturing  from  2017  to  2020.   At  December  31,  2017,  the  unrealized  gain  or  loss  on  these  derivative  contracts  recorded  in  AOCI  is  as  follows:   • WTI  oil  swap  contracts  –  unrealized  gain  of  $9.8  million  (December  31,  2016  –  $9.6  million  gain).   KINROSS ANNUAL REPORT 2017 FS 36                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   (iii) Total  return  swap  contracts   The  Company  enters  into  total  return  swaps   (“TRS”)  as  economic  hedges  of  the  Company’s  DSUs  and  cash-­‐settled  RSUs.     Under   the   terms   of   the   TRS,   a   bank   has   the   right   to   purchase   Kinross   shares   in   the   marketplace   as   a   hedge   against   the   returns  in  the  TRS.    At  December  31,  2017,  5,695,000  TRS  units  were  outstanding.       At  December  31,  2017,  74%  of  the  DSUs  were  economically  hedged  (December  31,  2016  –  90%)  and  102%  of  cash-­‐settled   RSUs  were  economically  hedged  (December  31,  2016  –  84%),  although  hedge  accounting  was  not  applied.   Non-­‐recurring  fair  value  measurement: (b) Property,  plant  and  equipment  was  written  down  to  its  recoverable  amount  at  Paracatu  during  the  year  ended  December   31,   2017   and   at   Maricunga   during   the   year   ended   December   2016.   In   addition,   the   Company   recognized   a   reversal   of   impairment  charges  related  to  the  property,  plant  and  equipment  at  Tasiast  and  Fort  Knox  due  to  changes  in  the  estimates   used   to   determine   the   recoverable   amount   of   the   Tasiast   and   Fort   Knox   CGUs   since   the   last   impairment   loss   was   recognized.  Certain  assumptions  used  in  the  calculation  of  the  recoverable  amount  are  categorized  as  Level  3  in  the  fair   value  hierarchy.       Fair  value  of  financial  assets  and  liabilities  not  measured  and  recognized  at  fair  value:   (c) Long-­‐term   debt   is   measured   at   amortized   cost.     The   fair   value   of   long-­‐term   debt   is   primarily   measured   using   market   determined  variables,  and  therefore  was  classified  within  Level  2  of  the  fair  value  hierarchy.    See  Note  12.   KINROSS ANNUAL REPORT 2017 FS 37         NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   11. CAPITAL  AND  FINANCIAL  RISK  MANAGEMENT   The  Company  manages  its  capital  to  ensure  that  it  will  be  able  to  continue  to  meet  its  financial  and  operational  strategies   and  obligations,  while  maximizing  the  return  to  shareholders  through  the  optimization  of  debt  and  equity  financing.    The   Board  of  Directors  has  established  a  number  of  quantitative  measures  related  to  the  management  of  capital.    Management   continuously  monitors  its  capital  position  and  periodically  reports  to  the  Board  of  Directors.   The   Company’s   operations   are   sensitive   to   changes   in   commodity   prices,   foreign   exchange   and   interest   rates.     The   Company  manages  its  exposure  to  changes  in  currency  exchange  rates  and  energy  by  periodically  entering  into  derivative   contracts   in   accordance   with   the   formal   risk   management   policy   approved   by   the   Company’s   Board   of   Directors.     The   Company’s   practice   is   to   not   hedge   metal   sales.     However,   in   certain   circumstances   the   Company   may   use   derivative   contracts   to   hedge   against   the   risk   of   falling   prices   for   a   portion   of   its   forecasted   metal   sales.     The   Company   may   also   assume  derivative  contracts  as  part  of  a  business  acquisition  or  they  may  be  required  under  financing  arrangements.   All   of   the   Company’s   hedges   are   cash   flow   hedges.     The   Company   applies   hedge   accounting   whenever   hedging   relationships  exist  and  have  been  documented.       i. Capital  management   The  Company’s  objectives  when  managing  capital  are  to:   • Ensure  the  Company  has  sufficient  cash  available  to  support  the  mining,  exploration,  and  other  areas  of  the  business   in  any  gold  price  environment;   • Ensure  the  Company  has  the  capital  and  capacity  to  support  a  long-­‐term  growth  strategy;   • Provide  investors  with  a  superior  rate  of  return  on  their  invested  capital;   • Ensure  compliance  with  all  bank  covenant  ratios;  and   • Minimize  counterparty  credit  risk.   Kinross   adjusts   its   capital   structure   based   on   changes   in   forecasted   economic   conditions   and   based   on   its   long-­‐term   strategic  business  plan.    Kinross  has  the  ability  to  adjust  its  capital  structure  by  issuing  new  equity,  drawing  on  existing   credit  facilities,  issuing  new  debt,  and  by  selling  or  acquiring  assets.    Kinross  can  also  control  how  much  capital  is  returned   to  shareholders  through  dividends  and  share  buybacks.   The  Company  is  not  subject  to  any  externally  imposed  capital  requirements.   The   Company’s   quantitative   capital   management   objectives   are   largely   driven   by   the   requirements   under   its   debt   agreements  as  well  as  a  target  total  debt  to  total  debt  and  common  shareholders’  equity  ratio  as  noted  in  the  table  below:     Long-­‐term  debt Current  portion  of  long-­‐term  debt Total  debt Common  shareholders'  equity Total  debt  /  total  debt  and  common  shareholders'  equity  ratio Company  target ii. Gold  and  silver  price  risk  management   No  derivatives  to  hedge  metal  sales  were  outstanding  in  2017  and  2016.       December  31, 2017  $                                                  1,732.6   December  31, 2016  $                                                  1,733.2   -­‐ 1,732.6 4,583.6 27.4% 0  –  30% -­‐ 1,733.2 4,145.5 29.5% 0  –  30% KINROSS ANNUAL REPORT 2017 FS 38                                                                                                                                                                                                                                                                                                                                                                                                   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   iii. Currency  risk  management   The   Company   is   primarily   exposed   to   currency   fluctuations   relative   to   the   U.S.   dollar   on   expenditures   that   are   denominated  in  Canadian  dollars,  Brazilian  reais,  Chilean  pesos,  Russian  roubles,  Mauritanian  ouguiya  and  Ghanaian  cedi.     This  risk  is  reduced,  from  time  to  time,  through  the  use  of  foreign  currency  hedging  contracts  to  lock  in  the  exchange  rates   on  future  non-­‐U.S.  denominated  currency  cash  outflows.    The  Company  has  entered  into  hedging  contracts  to  purchase   Canadian   dollars,   Brazilian   reais,   and   Russian   roubles   as   part   of   this   risk   management   strategy.     The   Company   is   also   exposed  to  the  impact  of  currency  fluctuations  on  its  monetary  assets  and  liabilities.    The  Company  may  from  time  to  time   manage  the  exposure  on  the  net  monetary  items.       At   December   31,   2017,   with   other   variables   unchanged,   the   following   represents   the   effect   of   movements   in   foreign   exchange  rates  on  the  Company's  net  working  capital,  on  earnings  before  taxes  from  a  10%  change  in  the  exchange  rate  of   the  U.S.  dollar  against  the  Canadian  dollar,  Brazilian  real,  Chilean  peso,  Russian  rouble,  Mauritanian  ouguiya,  Ghanaian  cedi   and  other.   Canadian  dollars Brazilian  reais Chilean  pesos Russian  roubles Euros Mauritanian  ouguiya Ghanaian  cedi Other  (b) Foreign  currency  net   working  capital 10%  strengthening  in   U.S.  dollar Effect  on  earnings  before   taxes,  gain  (loss)  (a) 10%  weakening  in   U.S.  dollar Effect  on  earnings  before   taxes,  gain  (loss)  (a) (24.5) (37.2) (15.5) 14.9 (3.1) (21.8) 12.9 (0.8) 2.2 3.4 1.4 (1.4) 0.3 2.0 (1.2) 0.1 (2.7) (4.1) (1.7) 1.7 (0.3) (2.4) 1.4 (0.1) (a) As  described  in  Note  3  (ii),  the  Company  translates  its  monetary  assets  and  liabilities  into  U.S.  dollars  at  the  rates  of  exchange  at  the   consolidated  balance  sheet  dates.    Gains  and  losses  on  translation  of  foreign  currencies  are  included  in  earnings.   Includes  British  pounds,  Australian  dollars  and  South  African  rand.   (b) At   December   31,   2017,   with   other   variables   unchanged,   the   following   represents   the   effect   of   the   Company's   foreign   currency   hedging   contracts   on   OCI   before   taxes   from   a   10%   change   in   the   exchange   rate   of   the   U.S.   dollar   against   the   Canadian  dollar,  Brazilian  real  and  Russian  rouble.       Canadian  dollars Brazilian  reais Russian  roubles 10%  strengthening  in   U.S.  dollar Effect  on  OCI  before   taxes,  gain  (loss)  (a) $                                                                               $                                                                           $                                                                               (5.6) (12.5) (1.1) 10%  weakening  in   U.S.  dollar Effect  on  OCI  before   taxes,  gain  (loss)  (a) $                                                                                 $                                                                             $                                                                                 6.8 15.6 2.2 (a) Upon   maturity   of   these   contracts,   the   amounts   in   OCI   before   taxes   will   reverse   against   hedged   items   that   the   contracts   relate   to,   which  may  be  to  earnings  or  property,  plant  and  equipment.   KINROSS ANNUAL REPORT 2017 FS 39                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   iv. Energy  price  risk   The  Company  is  exposed  to  changes  in  energy  prices  through  its  consumption  of  diesel  and  other  fuels,  and  the  price  of   electricity   in   some   electricity   supply   contracts.     The   Company   entered   into   energy   swap   contracts   that   partially   protect   against  the  risk  of  fuel  price  increases.    Fuel  is  consumed  in  the  operation  of  mobile  equipment  and  electricity  generation.       At  December  31,  2017,  with  other  variables  unchanged,  the  following  represents  the  effect  of  the  Company's  energy  swap   contracts  on  OCI  before  taxes  from  a  10%  change  in  WTI  oil  prices.       WTI  oil 10%  increase  in   price   Effect  on  OCI  before   taxes,  gain  (loss)  (a) $                                                                                 9.0 10%  decrease  in   price Effect  on  OCI  before   taxes,  gain  (loss)  (a) $                                                                               (8.9) (a) Upon   maturity   of   these   contracts,   the   amounts   in   OCI   before   taxes   will   reverse   against   hedged   items   that   the   contracts   relate   to,   which  will  be  to  earnings.   v. Liquidity  risk   The   Company   manages   liquidity   risk   by   maintaining   adequate   cash   and   cash   equivalent   balances   (December   31,   2017   -­‐   $1,025.8  million  in  aggregate),  by  utilizing  its  lines  of  credit  and  by  monitoring  developments  in  the  capital  markets.    The   Company   continuously   monitors   and   reviews   both   actual   and   forecasted   cash   flows.     The   contractual   cash   flow   requirements  for  financial  liabilities  at  December  31,  2017  are  as  follows:   Long-­‐term  debt  (a) Total $                                   2,684.0 2018 Within  1  year 2019,  2020 2  to  3  years 2021,  2022 4  to  5  years $                                             95.6 $                                         190.2 $                                         664.5 2023+ More  than  5  years $                                   1,733.7 (a) vi. Includes  long-­‐term  debt,  interest  and  the  full  face  value  of  the  senior  notes.       Credit  risk  management   Credit  risk  relates  to  cash  and  cash  equivalents,  accounts  receivable  and  derivative  contracts  and  arises  from  the  possibility   that  any  counterparty  to  an  instrument  fails  to  perform.    The  Company  generally  transacts  with  highly-­‐rated  counterparties   and  a  limit  on  contingent  exposure  has  been  established  for  counterparties  based  on  their  credit  ratings.    As  at  December   31,  2017,  the  Company’s  maximum  exposure  to  credit  risk  was  the  carrying  value  of  cash  and  cash  equivalents,  accounts   receivable  and  derivative  contracts.   KINROSS ANNUAL REPORT 2017 FS 40           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   12. LONG-­‐TERM  DEBT  AND  CREDIT  FACILITIES     Interest  Rates Nominal   Amount December  31,  2017 Deferred   Financing   Costs Carrying   Amount  (a) December  31,  2016 Fair   Value  (b) Carrying   Amount  (a) Fair   Value  (b) Corporate  term  loan  facility Senior  notes Long-­‐term  debt Variable (i) (ii) 4.50%-­‐6.875% $                                 -­‐ 1,745.7 1,745.7 $                 -­‐ $                         (13.1) (13.1) $                 -­‐ $                       1,732.6 1,732.6 $       -­‐ $                         1,848.4 1,848.4 $         (a)  Includes  transaction  costs  on  debt  financings.   (b)  The  fair  value  of  debt  is  primarily  determined  using  quoted  market  determined  variables.    See  Note  10  (c).       Scheduled  debt  repayments   $                         497.4 1,235.8 1,733.2 $               497.4 1,245.7 1,743.1 $       $                   Senior  notes Total  debt  payable 2018 $                               -­‐ $                               -­‐ 2019 $                               -­‐ $                               -­‐ 2020 2021 $                               -­‐ $                       $                       500.0 500.0 2022 $                               -­‐ $                               -­‐ 2023  and   thereafter $               $               1,250.0 1,250.0 Total 1,750.0 1,750.0 $               $               (i) Corporate  revolving  credit  and  term  loan  facilities   On   July   12,   2017,   the   Company   fully   repaid   the   outstanding   balance   on   the   term   loan   with   proceeds   from   the   $500.0   million  offering  of  debt  securities  completed  on  July  6,  2017.   On  July  28,  2017,  the  Company  amended  its  $1,500.0  million  revolving  credit  facility  to  extend  the  maturity  date  by  one   year  from  August  10,  2021  to  August  10,  2022.   As   at   December   31,   2017,   the   Company   had   utilized   $21.0   million   (December   31,   2016   –   $104.5   million)   of   its   $1,500.0   million  revolving  credit  facility.    The  amount  utilized  was  entirely  for  letters  of  credit.    On  January  4,  2016,  the  Company   drew  $175.0  million  in  cash  on  the  revolving  credit  facility,  and  repaid  the  amount  in  full  on  March  4,  2016.   Loan  interest  on  the  revolving  credit  facility  is  variable,  set  at  LIBOR  plus  an  interest  rate  margin  which  is  dependent  on  the   Company’s   credit   rating.     Based   on   the   Company’s   credit   rating   at   December   31,   2017,   interest   charges   and   fees   are   as  follows:     Type  of  credit Dollar  based  LIBOR  loan: Revolving  credit  facility Letters  of  credit Standby  fee  applicable  to  unused  availability LIBOR  plus  2.00% 1.33-­‐2.00% 0.40%   The  revolving  credit  facility’s  credit  agreement  contains  various  covenants  including  limits  on  indebtedness,  asset  sales  and   liens.    The  Company  is  in  compliance  with  its  financial  covenant  in  the  credit  agreement  at  December  31,  2017.   KINROSS ANNUAL REPORT 2017 FS 41                                                                                                                                           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   (ii) Senior  notes   On  July  6,  2017,  the  Company  completed  a  $500.0  million  offering  of  debt  securities  consisting  of  4.50%  senior  notes  due   2027.     The   Company   received   net   proceeds   of   $494.7   million   from   the   offering,   after   payment   of   related   fees   and   expenses.    The  notes  rank  equally  with  the  Company’s  existing  senior  notes.   As  at  December  31,  2017,  the  Company’s  $1,750.0  million  of  senior  notes  consisted  of  $500.0  million  principal  amount  of   5.125%   notes   due   2021,   $500.0   million   principal   amount   of   5.950%   notes   due   2024,   $500.0   million   principal   amount   of   4.50%  notes  due  2027  and  $250.0  million  principal  amount  of  6.875%  notes  due  2041.       In  September  2016,  the  Company  repaid  its  $250.0  million  3.625%  notes  in  full  on  the  maturity  date.   The  senior  notes  referred  to  above  (collectively,  the  “notes”)  pay  interest  semi-­‐annually.    Except  as  noted  below,  the  notes   are  redeemable  by  the  Company,  in  whole  or  part,  for  cash  at  any  time  prior  to  maturity,  at  a  redemption  price  equal  to   the   greater   of   100%   of   the   principal   amount   or   the   sum   of   the   present   value   of   the   remaining   scheduled   principal   and   interest  payments  on  the  notes  discounted  at  the  applicable  treasury  rate,  as  defined  in  the  indentures,  plus  a  premium  of   between  40  and  50  basis  points,  plus  accrued  interest,  if  any.    Within  three  months  of  maturity  of  the  notes  due  in  2021,   2024  and  2027,  and  within  six  months  of  maturity  of  the  notes  due  in  2041,  the  Company  can  only  redeem  the  notes  in   whole  at  100%  of  the  principal  amount  plus  accrued  interest,  if  any.    In  addition,  the  Company  is  required  to  make  an  offer   to  repurchase  the  notes  prior  to  maturity  upon  certain  fundamental  changes  at  a  repurchase  price  equal  to  101%  of  the   principal  amount  of  the  notes  plus  accrued  and  unpaid  interest  to  the  repurchase  date,  if  any.   (iii) Other   The   maturity   date   for   the   Company’s   Letter   of   Credit   guarantee   facility   with   Export   Development   Canada   (“EDC”)   was   extended  by  one  year  to  June  30,  2018,  effective  July  1,  2017.    Effective  December  5,  2017,  the  Company  entered  into  an   amendment  to  increase  the  amount  of  its  Letter  of  Credit  guarantee  facility  with  EDC  from  $250.0  million  to  $300.0  million.     Letters   of   credit   guaranteed   under   this   facility   are   solely   for   reclamation   liabilities   at   Fort   Knox,   Round   Mountain,   and   Kettle  River–Buckhorn.    Fees  related  to  letters  of  credit  under  this  facility  are  0.95%  to  1.00%.    As  at  December  31,  2017,   $215.2  million  (December  31,  2016  -­‐  $215.1  million)  was  utilized  under  this  facility.   In   addition,   at   December   31,   2017,   the   Company   had   $230.2   million   (December   31,   2016   -­‐   $117.7   million)   in   letters   of   credit  and  surety  bonds  outstanding  in  respect  of  its  operations  in  Brazil,  Mauritania,  Ghana  and  Chile.    These  have  been   issued  pursuant  to  arrangements  with  certain  international  banks.       As   at   December   31,   2017,   $254.7   million   (December   31,   2016   -­‐   $216.7   million)   of   surety   bonds   were   outstanding   with   respect   to   Kinross’   operations   in   the   United   States.     The   surety   bonds   were   issued   pursuant   to   arrangements   with   international  insurance  companies.   (iv) Changes  in  liabilities  arising  from  financing  activities   Changes  from  financing  cash  flows Other  changes Year  ended  December  31,  2017  Balance  as  at   January  1,  2017   Debt   issued Debt   repayments Long-­‐term  debt Accrued  interest  payable  (a) $                           1,733.2 23.4 $           494.7 -­‐ $                 (500.0) -­‐ Interest   paid -­‐ $             (62.9) $       1,756.6 Included  in  Accounts  Payable  and  Accrued  Liabilities.   $                           (500.0) $                 494.7 $           (62.9) (a) Interest   expense Capitalized   interest Capitalized   interest  paid Other  cash   changes Other  non-­‐ cash  changes Balance  as  at     December  31,  2017 -­‐ $             86.5 -­‐ $                         25.1 $                               -­‐ (18.0)  -­‐     $                                 4.7 (8.3) (12.0) $                                         1,732.6 33.8 $         86.5 $                     25.1 $                       (18.0) $                   (12.0) $                               (3.6) $                                         1,766.4 Other -­‐$     -­‐         -­‐$     KINROSS ANNUAL REPORT 2017 FS 42                                                                                                                                                                                                                                                                                                             NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Year  ended  December  31,  2016  Balance  as  at   January  1,  2016   Changes  from  financing  cash  flows Debt   issued Debt   repayments Interest   paid Other Interest   expense Capitalized   interest Other  changes Capitalized   interest  paid Other  cash   changes Other  non-­‐ cash  changes Balance  as  at     December  31,  2016 Long-­‐term  debt Accrued  interest  payable  (a) $                           1,981.4 $           175.0 $                 (425.0) $             -­‐ -­‐$     $             -­‐ $                         -­‐ $                               -­‐ $                         (1.2) $                                 3.0 $                                         1,733.2 26.7 -­‐ -­‐ (73.5) -­‐         100.4 15.2 (21.8) (12.3) (11.3) 23.4 2,008.1 $       Included  in  Accounts  Payable  and  Accrued  Liabilities.   $                           (425.0) $                 175.0 $           (73.5) (a) -­‐$     $     100.4 $                     15.2 $                       (21.8) $                   (13.5) $                               (8.3) $                                         1,756.6 KINROSS ANNUAL REPORT 2017 FS 43                                                                                                                                                                                                                                                                                                       NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   13. PROVISIONS   Balance  at  January  1,  2017 Additions   Reductions   Reclamation  spending   Accretion Reclamation  expense Dispositions  (a) Balance  at  December  31,  2017 Current  portion Non-­‐current  portion $                                             Reclamation  and   remediation   obligations  (i) 908.3 9.7 (19.4) (42.6) 31.3 11.4 (37.3) $                                                 Other 46.1 6.2 (16.4) -­‐ -­‐ -­‐ (0.3) $                                             Total 954.4 15.9 (35.8) (42.6) 31.3 11.4 (37.6) $                                             861.4 $                                                 35.6 $                                             897.0                                                      62.3                                                    799.1    $                                          861.4    $                                                35.6                                                            4.2                                                        66.5                                                        31.4                                                    830.5    $                                          897.0     (a) On  November  3,  2017,  the  Company  completed  the  sale  of  its  interest  in  the  DeLamar  reclamation  property.  See  Note  6  iii.   (i) Reclamation  and  remediation  obligations   The   Company   conducts   its   operations   so   as   to   protect   the   public   health   and   the   environment,   and   to   comply   with   all   applicable  laws  and  regulations  governing  protection  of  the  environment.    Reclamation  and  remediation  obligations  arise   throughout  the  life  of  each  mine.    The  Company  estimates  future  reclamation  costs  based  on  the  level  of  current  mining   activity  and  estimates  of  costs  required  to  fulfill  the  Company’s  future  obligations.    The  above  table  details  the  items  that   affect  the  reclamation  and  remediation  obligations.       Included   in   other   operating   expense   for   the   year   ended   December   31,   2017   is   a   $11.4   million   expense   (year   ended   December  31,  2016  –  $27.2  million  expense)  reflecting  revised  estimated  fair  values  of  costs  that  support  the  reclamation   and  remediation  obligations  for  properties  that  have  been  closed.    The  majority  of  the  expenditures  are  expected  to  occur   between  2018  and  2041.    The  discount  rates  used  in  estimating  the  site  restoration  cost  obligation  were  between  1.8%  and   11.6%  for  the  year  ended  December  31,  2017  (year  ended  December  31,  2016  –  0.9%  and  13.9%),  and  the  inflation  rate   used   was   between   1.8%   and   5.0%   for   the   year   ended   December   31,   2017   (year   ended   December   31,   2016   –   2.4%   and   5.6%).   Regulatory   authorities   in   certain   jurisdictions   require   that   security   be   provided   to   cover   the   estimated   reclamation   and   remediation  obligations.    As  at  December  31,  2017,  letters  of  credit  totaling  $411.5  million  (December  31,  2016  –  $402.0   million)  had  been  issued  to  various  regulatory  agencies  to  satisfy  financial  assurance  requirements  for  this  purpose.    The   letters   of   credit   were   issued   against   the   Company's   Letter   of   Credit   guarantee   facility   with  EDC,   the   corporate  revolving   credit   facility,   and   pursuant   to   arrangements   with   certain   international   banks.     The   Company   is   in   compliance   with   all   applicable   requirements   under   these   facilities.     As   at   December   31,   2017,   $254.7   million   (December   31,   2016  –  $216.7   million)  of  surety  bonds  were  issued  with  respect  to  Kinross’  operations  in  the  United  States.    The  surety  bonds  were  issued   pursuant  to  arrangements  with  international  insurance  companies.   KINROSS ANNUAL REPORT 2017 FS 44                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   14. COMMON  SHARE  CAPITAL   The  authorized  share  capital  of  the  Company  is  comprised  of  an  unlimited  number  of  common  shares  without  par  value.    A   summary  of  common  share  transactions  for  the  years  ended  December  31,  2017  and  2016  is  as  follows:     Years  ended                                                                                                                             Year  ended                                                                                                                                       December  31,  2017 December  31,  2016 Number  of  shares (000's) Amount Number  of  shares (000's) Amount Common  shares Balance  at  January  1,   Equity  issuance  (a) Under  share  option  and  restricted  share  plans Balance  at  end  of  period 1,245,050                                                              -­‐       1,954 1,247,004 $                                 $                                 14,894.2 -­‐ 8.3 14,902.5 1,146,540 95,910 2,600 1,245,050 14,603.5 275.7 15.0 14,894.2 $                                 $                                 Total  common  share  capital   $                                 14,902.5 $                                 14,894.2 (a) On  March  4,  2016,  the  Company  completed  a  public  equity  offering  of  83.4  million  common  shares  at  a  price  of  $3.00  per  common   share   for   gross   proceeds   of   approximately   $250.0   million.     On   March   15,   2016,   the   underwriters   elected   to   exercise   an   option   to   purchase  up  to  an  additional  15%  of  the  offering  to  cover  over-­‐allotments,  and  as  a  result,  an  additional  12.5  million  common  shares   were  issued  at  a  price  of  $3.00  per  common  share.    The  sale  was  completed  on  March  18,  2016  and  increased  the  gross  proceeds  from   the  offering  to  $287.7  million.    Transaction  costs  of  $12.0  million  resulted  in  net  proceeds  of  $275.7  million.   KINROSS ANNUAL REPORT 2017 FS 45                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   15. SHARE-­‐BASED  PAYMENTS   Share-­‐based  compensation  recorded  during  the  years  ended  December  31,  2017  and  2016  was  as  follows:   Share  option  plan  expense  (i) Restricted  share  unit  plan  expense,  including  restricted  performance  shares  (ii) Deferred  share  units  expense  (iii) Employer  portion  of  employee  share  purchase  plan  (iv) Total  share-­‐based  compensation (i) Share  option  plan   Years  ended  December  31,   2017 2016  $                                                          2.4   $                                                                                                                      23.4                                                                  1.2                                                                  2.0    $                                                    29.0   $                                                       2.8 24.0 1.2 2.0 30.0 The  Company  has  a  share  option  plan  for  officers,  employees,  and  contractors  enabling  them  to  purchase  common  shares.     Under  the  share  option  plan,  the  aggregate  number  of  shares  reserved  for  issuance  may  not  exceed  31.2  million  common   shares.     Additionally,   the   aggregate   number   of   Common   Shares   reserved   for   issuance   under   the   share   option   plan   to   insiders,   at   any   one   time   upon   the   exercise   of   Options   and   pursuant   to   all   other   compensation   arrangements   of   the   Company  shall  not  exceed  10%  of  the  total  number  of  Common  Shares  then  outstanding.    Each  option  granted  under  the   plan  on  or  after  February  16,  2011  is  for  a  maximum  term  of  seven  years.    One-­‐third  of  the  options  granted  are  exercisable   each   year   commencing   one   year   after   the   date   of   grant.     The   exercise   price   is   determined   by   the   Company's   Board   of   Directors  at  the  time  the  option  is  granted,  and  may  not  be  less  than  the  closing  market  price  of  the  common  shares  on  the   last   trading   day   prior   to   the   grant   date   of   the   option.     The   stock   options   outstanding   at   December   31,   2017   expire   at   various  dates  to  2024.    The  number  of  common  shares  available  for  the  granting  of  options  as  at  December  31,  2017  was   12.5  million.   The   following   table   summarizes   the   status   of   the   share   option   plan   and   changes   during   the   years   ended   December   31,   2017  and  2016:     2017 2016 Number  of  options   (000's) Weighted  average   exercise  price   (CDN$/option) Number  of  options   (000's) Weighted  average   exercise  price   (CDN$/option) $                                                 $                                                 Balance  at  January  1 Granted Exercised Forfeited Expired Outstanding  at  end  of  period Exercisable  at  end  of  period 12,429 1,669 (265) (1,567) (93) 12,173 8,539 6.95 5.06 4.09 8.74 7.38 6.52 7.41 13,513 1,872 (708) (1,300) (948) 12,429 7,911 7.57 4.17 5.17 6.57 12.17 6.95 8.51 $                                                 $                                                 $                                                 $                                                 For  the  year  ended  December  31,  2017,  the  weighted  average  share  price  at  the  date  of  exercise  was  CDN$5.51.       KINROSS ANNUAL REPORT 2017 FS 46                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   The  following  table  summarizes  information  about  the  stock  options  outstanding  and  exercisable  at  December  31,  2017:     Options  outstanding Options  exercisable Exercise  price  range  in   CDN$:  $                      4.22    $                          2.96                                    4.23                              9.53                                    9.54                          14.31                          16.25                              14.32   Number  of   options (000’s) Weighted   average   exercise  price (CDN$) Weighted   average   remaining   contractual   life (years) Number  of   options (000’s) Weighted   average   exercise  price (CDN$) 4,169 6,145 1,140 719 12,173 $                       3.87 6.41 10.70 16.25 6.52 $                       4.12 3.32 1.20 0.15 3.21 2,151 4,528 1,141 719 8,539 $                       3.81 6.89 10.70 16.25 7.41 $                       Weighted   average   remaining   contractual   life (years) 3.81 2.31 1.20 0.15 2.36 The   following   weighted   average   assumptions   were   used   in   computing   the   fair   value   of   stock   options   using   the   Black-­‐Scholes  option  pricing  model  granted  during  the  years  ended  December  31,  2017  and  2016:   2017 2016      Weighted  average  share  price    (CDN$)      Expected  dividend  yield      Expected  volatility      Risk-­‐free  interest  rate      Expected  option  life  (in  years) Weighted  average  fair  value  per  stock  option  granted  (CDN$) $                                         $                                         5.06 0.0% 49.3% 1.1% 4.5 2.09  $                                        4.17   0.0% 56.9% 0.6% 4.5  $                                        1.92   The  expected  volatility  used  in  the  Black-­‐Scholes  option  pricing  model  is  based  primarily  on  the  historical  volatility  of  the   Company’s  shares.       (ii) Restricted  Share  Plan   The  Company  has  a  Restricted  Share  Plan  whereby  RSUs  and  RPSUs  may  be  granted  to  employees,  officers  and  contractors   of  the  Company.    The  current  maximum  number  of  common  shares  issuable  under  this  plan  is  12.3  million.   (a) Restricted  share  units   RSUs  are  generally  exercisable  into  one  common  share  entitling  the  holder  to  acquire  the  common  share  for  no  additional   consideration.    RSUs  vest  over  a  three  year  period.   The  following  table  summarizes  information  about  the  RSUs  outstanding  at  December  31,  2017  and  2016:   Balance  at  January  1 Granted Redeemed Forfeited Outstanding  at  end  of  period 2017 2016 Number  of  units   (000's) Weighted  average   fair  value   (CDN$/unit) Number  of  units   (000's) Weighted  average   fair  value   (CDN$/unit) 9,219 $                                                 4.01 9,041 $                                                 4.41 5,128 (4,847) (1,223) 8,277 5.07 4.01 $                                                 4.24 4.63 5,502 (4,435) (889) 9,219 4.14 4.96 $                                                 4.11 4.01 As  at  December  31,  2017,  the  Company  had  recognized  a  liability  of  $11.3  million  (December  31,  2016  -­‐  $11.4  million)  in   respect  of  its  cash-­‐settled  RSUs.   KINROSS ANNUAL REPORT 2017 FS 47                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   (b) Restricted  performance  share  units   The  RPSUs  are  subject  to  certain  vesting  requirements  and  vest  at  the  end  of  three  years.    The  vesting  requirements  are   based  on  certain  performance  criteria  over  the  vesting  period  established  by  the  Company.   The  following  table  summarizes  information  about  the  RPSUs  outstanding  at  December  31,  2017  and  2016:     2017 2016 Balance  at  January  1 Granted Redeemed Forfeited Outstanding  at  end  of  period (iii) Deferred  share  unit  plan   Number  of  units   (000's) 4,993 1,209 (889) (427) 4,886 $                                                 Weighted  average   fair  value   (CDN$/unit) 4.51 5.32 5.39 4.81 4.52 $                                                 Number  of  units   (000's) 4,313 1,887 (495) (712) 4,993 $                                                 Weighted  average   fair  value   (CDN$/unit) 4.88 4.47 6.55 5.20 4.51 $                                                 The  Company  has  a  DSU  plan  for  its  outside  directors  which  provides  that  each  outside  director  receives,  on  the  last  date  in   each  quarter  a  number  of  DSUs  having  a  value  equal  to  a  minimum  of  50%  of  the  compensation  of  the  outside  director  for   the  current  quarter.    Each  outside  director  can  elect  to  receive  a  greater  percentage  of  their  compensation  in  DSUs.    The   number   of   DSUs   granted   to   an   outside   director   is   based   on   the   closing   price   of   the   Company's   common   shares   on   the   Toronto   Stock   Exchange   on   the   business   day   immediately   preceding   the   DSU   issue   date.     At   such   time   as   an   outside   director  ceases  to  be  a  director,  the  Company  will  make  a  cash  payment  on  the  outstanding  DSUs  to  the  outside  director  in   accordance   with   the   redemption   election   made   by   the   departing   director   or   in   the   absence   of   an   election   to   defer   redemption,  in  accordance  with  the  default  redemption  provisions  provided  in  the  Deferred  Share  Unit  Plan.   The   number   of   DSUs   granted   by   the   Company   and   the   weighted   average   fair   value   per   unit   issued   for   the   years   ended   December  31,  2017  and  2016  are  as  follows:   DSUs  granted  (000's) Weighted  average  grant-­‐date  fair  value  (CDN$/  unit) Years  ended  December  31, 2017 2016 $                                                       297 5.15 308  $                                                      4.97   There  were  1,618,348  DSUs  outstanding,  for  which  the  Company  had  recognized  a  liability  of  $7.0  million,  as  at  December   31,  2017  (December  31,  2016  -­‐  $4.1  million).     (iv) Employee  share  purchase  plan  (“SPP”) The  Company  has  an  employee  SPP  whereby  certain  employees  of  the  Company  have  the  opportunity  to  contribute  up  to  a   maximum   of   10%   of   their   annual   base   salary   to   purchase   common   shares.     Since   2004,   the   Company   has   made   contributions  equal  to  50%  of  the  employees'  contributions.   The   compensation   expense   related   to   the   employee   SPP   for   the   year   ended   December   31,   2017   was   $2.0   million   (year   ended  December  31,  2016  –  $2.0  million).   KINROSS ANNUAL REPORT 2017 FS 48                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   16. EARNINGS  (LOSS)  PER  SHARE   Basic  and  diluted  net  earnings  attributable  to  common  shareholders  of  Kinross  for  the  year  ended  December  31,  2017  was   $445.4  million  (year  ended  December  31,  2016  –  $104.0  million  loss).       Earnings  (loss)  per  share  has  been  calculated  using  the  weighted  average  number  of  common  shares  and  common  share   equivalents   issued   and   outstanding   during   the   period.     Stock   options   are   reflected   in   diluted   earnings   per   share   by   application   of   the   treasury   method.     The   following   table   details   the   weighted   average   number   of   outstanding   common   shares  for  the  purpose  of  computing  basic  and  diluted  loss  per  common  share  for  the  following  periods:   (Number  of  common  shares  in  thousands) Basic  weighted  average  shares  outstanding: Weighted  average  shares  dilution  adjustments: Stock  options Restricted  shares   Restricted  performance  shares Diluted  weighted  average  shares  outstanding Weighted  average  shares  dilution  adjustments  -­‐  exclusions:  (a) Stock  options  (b) Restricted  shares   Restricted  performance  shares Years  ended  December  31, 2017 2016 1,246,619 1,227,007 1,606 3,905 4,915 1,257,045 7,199 -­‐ -­‐ -­‐ -­‐ -­‐ 1,227,007 12,429 3,625 4,786 (a) These  adjustments  were  excluded,  as  they  are  anti-­‐dilutive.   (b) Anti-­‐dilutive  stock  options  were  determined  using  the  Company’s  average  share  price  for  the  year.    For  the  years  ended  December  31,   2017  and  2016,  the  average  share  price  used  was  $4.00  and  $3.91,  respectively.       KINROSS ANNUAL REPORT 2017 FS 49                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   17. INCOME  TAX  EXPENSE  (RECOVERY)   The  following  table  shows  the  components  of  the  current  and  deferred  tax  expense:     Current  tax  expense  (recovery)      Current  period      Adjustment  for  prior  period Deferred  tax  expense  (recovery) Origination  and  reversal  of  temporary  differences Impact  of  changes  in  tax  rate Change  in  unrecognized  deductible  temporary  differences Recognition  of  previously  unrecognized  tax  losses Total  tax  expense  (recovery) Years  ended  December  31,   2017 2016 $                                 63.2                                  (10.0) $                             223.9 (24.6)                          (83.0)                              (0.1)                                  7.5                                (0.8) (23.2) $                             (143.6) -­‐ (6.7) 0.6 49.6 $                                 The  $23.2  million  income  tax  recovery  recognized  in  2017  includes  a  net  benefit  of  $93.4  million  due  to  the  enactment  of   U.S.  Tax  Reform  legislation  on  December  22,  2017.  The  estimated  net  benefit  includes  a  benefit  of  $124.4  million  in  respect   of   the   collectability   of   the   Alternative   Minimum   Tax   (“AMT”)   credit,   which   is   partially   offset   by   the   write-­‐down   of   net   deferred   tax   assets   to   reflect   the   reduction   in   the   U.S.   corporate   tax   rate   from   35%   to   21%   beginning   January   1,   2018.   Further   guidance   on   the   implementation   and   application   of   the   U.S.   Tax   Reform   legislation   will   be   forthcoming   in   regulations  to  be  issued  by  the  Department  of  the  Treasury,  legislation  or  guidance  from  the  states  in  which  the  Company   operates,   and   directions   from   the   Office   of   Management   and   Budget.   Such   legislation,   regulations,   directions,   and   additional   guidance   may   require   changes   to   the   estimated   net   benefit   recorded   and   the   impact   of   such   changes   will   be   accounted   for   in   the   period   in   which   the   legislation,   regulations,   directions,   and   additional   guidance   are   enacted   or   released  by  the  relevant  authorities.   The  reconciliation  of  the  combined  Canadian  federal  and  provincial  statutory  income  tax  rate  to  the  effective  tax  rate  is  as   follows:   Combined  statutory  income  tax  rate Increase  (decrease)  resulting  from: Mining  taxes Resource  allowance  and  depletion Difference  in  foreign  tax  rates  and  foreign  exchange  on  deferred  income  taxes   within  income  tax  expense Benefit  of  losses  not  recognized Recognition  of  tax  attributes  not  previously  benefited   Under  (over)  provided  in  prior  periods Income  not  subject  to  tax Effect  of  non-­‐taxable  impairment  reversal Enacted  rate  change Accounting  expenses  disallowed  for  tax Taxes  on  repatriation  of  foreign  earnings AMT  Credit  recovery  due  to  U.S.  Tax  Reform Other Effective  tax  rate 2017 2016 26.5% 26.5% 5.0% 0.0% (19.1%) 33.9% (3.5%) (8.9%) (3.0%) (17.6%) 0.1% 9.8% 3.8% (29.7%) (2.8%) (5.5%) 4.4% 1.1% 94.0% (160.1%) (44.0%) (8.2%) 109.2% 0.0% 0.0% (17.2%) (79.9%) 0.0% (9.2%) (83.4%) KINROSS ANNUAL REPORT 2017 FS 50                                                                                                                                                                                                 NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   i. Deferred  income  tax   The  following  table  summarizes  the  components  of  deferred  income  tax:     Deferred  tax  assets Accrued  expenses  and  other   Property,  plant  and  equipment Reclamation  and  remediation  obligations Inventory  capitalization Non-­‐capital  loss   Deferred  tax  liabilities          Accrued  expenses  and  other    Property,  plant  and  equipment          Inventory  capitalization Deferred  tax  liabilities  -­‐  net December  31,   2017 December  31,   2016 $                         28.3 43.3 50.2 3.4 6.2 131.4 $                         39.3 25.5 118.1 8.8 -­‐ 191.7 4.9 316.8 32.0 222.3 $                           14.5 442.0 31.4 296.2 $                             For   balance   sheet   disclosure   purposes,   deferred   tax   assets   and   liabilities   have   been   offset   where   they   relate   to   income   taxes  levied  by  the  same  taxation  authority  and  the  Company  has  the  legal  right  and  intent  to  offset.   Movement  in  net  deferred  tax  liabilities:   December  31,   2017 December  31,   2016 Balance  at  the  beginning  of  the  period Recognized  in  profit/loss Recognized  in  OCI Other Balance  at  the  end  of  the  period $                           $                           296.2 (76.4) (0.8) 3.3 222.3 $                             422.5                              (149.7) 9.5 13.9 296.2 $                             ii. Unrecognized  deferred  tax  assets  and  liabilities   The  aggregate  amount  of  taxable  temporary  differences  associated  with  investments  in  subsidiaries,  for  which  deferred  tax   liabilities  have  not  been  recognized,  as  at  December  31,  2017  is  $6.5  billion  (December  31,  2016  –  $6.5  billion).   Deferred  tax  assets  have  not  been  recognized  in  respect  of  the  following  items:     Deductible  temporary  differences Tax  losses December  31,   2017 $                           777.0 505.4 December  31,   2016 $                             721.4 458.5 The  tax  losses  not  recognized  expire  as  per  the  amount  and  years  noted  below.    The  deductible  temporary  differences  do   not  expire  under  current  tax  legislation.    Deferred  tax  assets  have  not  been  recognized  in  respect  of  these  items  because  it   is  not  probable  that  future  taxable  profit  will  be  available  against  which  the  Company  can  utilize  the  benefits  therefrom.   KINROSS ANNUAL REPORT 2017 FS 51                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   iii. Non-­‐capital  losses  (not  recognized)   The  following  table  summarizes  the  Company’s  non-­‐capital  losses  that  can  be  applied  against  future  taxable  profit:   Country Canada United  States(a) Chile Mauritania Other Type Amount Expiry  Date Net  operating  losses Net  operating  losses Net  operating  losses Net  operating  losses Net  operating  losses $                              804.2                                    42.8                                171.4                                    21.2                                    59.9   2018  -­‐  2037 2018  -­‐  2037 No  expiry 2018  -­‐  2021 Various   (a)    Utilization  of  the  United  States  loss  carry  forwards  will  be  limited  in  any  year  as  a  result  of  the  previous  changes  in  ownership. KINROSS ANNUAL REPORT 2017 FS 52       NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   18. SEGMENTED  INFORMATION   The   Company   operates   primarily   in   the   gold   mining   industry   and   its   major   product   is   gold.     Its   activities   include   gold   production,  acquisition,  exploration  and  development  of  gold  properties.    The  Company’s  primary  mining  operations  are  in   the  United  States,  the  Russian  Federation,  Brazil,  Chile,  Ghana  and  Mauritania.   The  reportable  segments  are  those  operations  whose  operating  results  are  reviewed  by  the  chief  operating  decision  maker   to  make  decisions  about  resources  to  be  allocated  to  the  segment  and  assess  its  performance  provided  those  operations   pass   certain   quantitative   thresholds.     Operations   whose   revenues,   earnings   or   losses   or   assets   exceed   10%   of   the   total   consolidated  revenue,  earnings  or  losses  or  assets  are  reportable  segments.   In   order   to   determine   reportable   operating   segments,   management   reviews   various   factors,   including   geographical   location   and   managerial   structure.     It   was   determined   by   management   that   a   reportable   operating   segment   generally   consists  of  an  individual  mining  property  managed  by  a  single  general  manager  and  management  team.       The  Kupol  segment  includes  the  Kupol  and  Dvoinoye  mines.    These  two  mines  have  been  aggregated  into  one  reportable   segment  as  they  have  integrated  cost  structures,  due  to  the  processing  of  Dvoinoye  ore  at  the  Kupol  mill,  and  other  shared   infrastructure  such  as  the  purchasing  function.   The  Corporate  and  other  segment  includes  corporate,  Cerro  Casale  until  its  disposal  on  June  9,  2017,  shutdown  and  other   non-­‐operating  assets  (including  La  Coipa,  Lobo-­‐Marte  and  White  Gold  until  its  disposal  on  June  14,  2017)  and  non-­‐mining   and  other  operations.    These  have  been  aggregated  into  one  reportable  segment  as  they  do  not  generate  revenues  for  the   Company.   Finance  income,  finance  expense,  other  income  (expense),  and  equity  in  earnings  (losses)  of  associate  and  joint  ventures   are  managed  on  a  consolidated  basis  and  are  not  allocated  to  operating  segments.   KINROSS ANNUAL REPORT 2017 FS 53                                   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   i. Operating  segments   The  following  tables  set  forth  operating  results  by  reportable  segment  for  the  following  periods:   Years  ended  December  31,  2017: Revenue Metal  sales Cost  of  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment,  net  of  reversals Total  cost  of  sales Gross  profit  (loss) Other  operating  expense Exploration  and  business  development General  and  administrative Operating  earnings  (loss) Other  income  (expense)  -­‐  net Equity  in  earnings  (losses)  of  associate  and  joint  ventures Finance  income Finance  expense Earnings  before  tax Years  ended  December  31,  2016: Revenue Metal  sales Cost  of  sales Production  cost  of  sales Depreciation,  depletion  and  amortization Impairment,  net  of  reversals Total  cost  of  sales Gross  profit  (loss) Other  operating  expense   Exploration  and  business  development General  and  administrative Operating  earnings  (loss) Other  income  (expense)  -­‐  net Equity  in  earnings  (losses)  of  associate  and  joint  venture Finance  income Finance  expense Loss  before  tax Operating  segments Fort  Knox Round   Mountain Bald   Mountain Paracatu Maricunga Kupol   Kettle  River-­‐ Buckhorn Tasiast Chirano Non-­‐operating   segments  (a) Corporate  and   other  (b) Total $                   481.1 552.2 331.5 447.0 239.9 86.6 (88.6) 237.9 243.2 9.5 9.0 -­‐ 224.7 $                   $                   302.5 107.4 -­‐ 409.9 142.3 -­‐ 2.6 -­‐ 139.7 168.9 83.5 -­‐ 252.4 79.1 1.1 9.5 -­‐ 68.5 310.2 127.0 253.0 690.2 (243.2) 20.1 -­‐ -­‐ (263.3) 52.0 19.9 4.6 -­‐ 24.5 27.5 6.1 0.1 -­‐ 21.3 726.9 300.9 184.2 -­‐ 485.1 241.8 (0.3) 17.1 -­‐ 225.0 96.3 36.8 0.6 -­‐ 37.4 58.9 10.9 4.6 -­‐ 43.4 298.4 317.6 -­‐ $                     3,303.0 178.2 78.6 (142.9) 113.9 184.5 60.0 5.7 -­‐ 118.8 200.1 138.6 -­‐ 338.7 (21.1) (1.8) 8.2 -­‐ (27.5) -­‐ 8.3 -­‐ 8.3 (8.3) 24.0 49.2 132.6 (214.1) $                           $                           1,757.4 819.4 21.5 2,598.3 704.7 129.6 106.0 132.6 336.5 188.1 (1.3) 13.5 (117.8) Operating  segments Fort  Knox Round   Mountain Bald   Mountain Paracatu Maricunga Kupol   Kettle  River-­‐ Buckhorn Tasiast Chirano $                           419.0 Non-­‐operating   segments  (a) Corporate  and   other  (b) Total $                   510.8 477.1 139.6 599.6 219.4 919.2 139.8 208.0 258.5 -­‐ $                     3,472.0 302.2 88.7 -­‐ 390.9 119.9 1.0 8.9 -­‐ 110.0 $                   $                   292.0 94.7 -­‐ 386.7 90.4 -­‐ 4.6 -­‐ 85.8 131.7 38.6 -­‐ 170.3 (30.7) 2.0 4.7 -­‐ (37.4) 346.4 142.7 -­‐ 489.1 110.5 74.3 -­‐ -­‐ 36.2 145.2 34.4 139.6 319.2 (99.8) 50.8 -­‐ -­‐ (150.6) 324.3 236.8 -­‐ 561.1 358.1 (0.5) 13.3 -­‐ 345.3 73.0 1.3 -­‐ 74.3 65.5 (0.7) 2.2 -­‐ 64.0 179.3 96.4 -­‐ 275.7 (67.7) 46.3 5.9 -­‐ (119.9) 189.7 109.9 -­‐ 299.6 (41.1) 8.0 8.9 -­‐ (58.0) -­‐ 11.5 -­‐ 11.5 (11.5) 28.1 45.8 143.7 (229.1) $                             $                                 1,983.8 855.0 139.6 2,978.4 493.6 209.3 94.3 143.7 46.3 22.5 (1.2) 7.5 (134.6) $                               (59.5) KINROSS ANNUAL REPORT 2017 FS 54                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Operating  segments Fort  Knox Round   Mountain Bald   Mountain Paracatu Maricunga Kupol   Kettle  River-­‐ Buckhorn Tasiast Chirano Non-­‐operating   segments(a) Corporate  and   other  (b) Total $                   354.1 286.2 422.2 1,383.1 39.5 474.7 1.3 1,296.0 332.6 297.5 $                     4,887.2 $                   559.1 460.2 612.2 1,646.5 171.3 1,164.5 9.2 1,580.3 516.4 1,437.5 $                     8,157.2 Property,  plant  and  equipment  at: December  31,  2017 Total  assets  at: December  31,  2017 Capital  expenditures  for  year  ended  December  31,  2017  (c) $                   110.2 97.1 90.4 121.6 1.4 54.1 -­‐ 434.5 46.0 5.0 $                           960.3 Property,  plant  and  equipment  at: December  31,  2016 Total  assets  at: December  31,  2016 Operating  segments Fort  Knox Round   Mountain Bald   Mountain Paracatu Maricunga Kupol   Kettle  River-­‐ Buckhorn Tasiast Chirano Non-­‐operating   segments(a) Corporate  and   other  (b) Total $                   248.4 307.1 440.9 1,647.5 37.6 599.5 2.0 826.9 416.6 391.1 $                     4,917.6 $                   457.7 430.8 598.9 1,880.4 145.3 1,417.0 15.9 1,122.8 581.5 1,329.0 $                     7,979.3 Capital  expenditures  for  year  ended  December  31,  2016  (c) $                         67.2 70.1 41.2 113.8 5.1 88.0 -­‐ 200.4 48.2 11.1 $                             645.1 (a) Non-­‐operating  segments  include  development  properties.   (b) Corporate   and   other   includes   corporate,   Cerro   Casale   until   its   disposal   on   June   9,   2017,   shutdown   and   other   non-­‐operating   assets   (c) (including  La  Coipa,  Lobo-­‐Marte  and  White  Gold  until  its  disposal  on  June  14,  2017).   Segment  capital  expenditures  are  presented  on  an  accrual  basis.    Additions  to  property,  plant  and  equipment  in  the  consolidated         statements  of  cash  flows  are  presented  on  a  cash  basis.   ii. Geographic  segments   The  following  table  shows  metal  sales  and  property,  plant  and  equipment  by  geographic  region:   Metal  sales Years  ended  December  31, 2017 2016 Property,  plant  and  equipment As  at  December  31, 2017 2016 Geographic  information  (a) United  States Russian  Federation Brazil Chile   Mauritania Ghana Canada Total $                                     $                                       $                                     $                                       1,461.1 726.9 447.0 52.0 298.4 317.6 -­‐ 3,303.0 1,267.3 919.2 599.6 219.4 208.0 258.5 -­‐ 3,472.0 1,067.4 482.3 1,383.1 308.8 1,302.1 343.5 -­‐ 4,887.2 1,002.1 630.8 1,647.5 306.6 832.5 427.9 70.2 4,917.6 $                                     $                                       $                                     $                                                      (a)  Geographic  location  is  determined  based  on  location  of  the  mining  assets.   KINROSS ANNUAL REPORT 2017 FS 55                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   iii. Significant  customers   The  following  table  represents  sales  to  individual  customers  exceeding  10%  of  annual  metal  sales  for  the  following  periods:   For  the  year  ended   December  31,  2017: Fort  Knox Round   Mountain Bald   Mountain Paracatu Maricunga Kupol Kettle   River-­‐ Buckhorn Tasiast Chirano Total Customer 1 2 3 %  of  total  metal  sales $                            -­‐                        54.4                          6.4                              -­‐                        60.2                    19.0                              -­‐                        64.8                    16.4                              -­‐                        48.8                          6.8                    11.6                157.9                              -­‐                    694.5                    16.4                              -­‐                                  -­‐                                  -­‐                        16.9                146.9                              -­‐                        31.7                              -­‐                    116.3                    99.1   For  the  year  ended   December  31,  2016: Fort  Knox Round   Mountain Bald   Mountain Paracatu Maricunga Kupol Kettle   River-­‐ Buckhorn Tasiast Chirano Customer 1 2 3 %  of  total  metal  sales $              101.8                      75.9                      22.0                              -­‐                                  -­‐                                  -­‐                                  -­‐                                  -­‐                                  -­‐                    130.1                      41.8                      20.5                      66.6                      80.2                      72.5                              -­‐                                  -­‐                                  -­‐                                  -­‐                                  -­‐                    473.5                              -­‐                    405.5                              -­‐                                  -­‐                                  -­‐                                  -­‐       694.5 531.5 342.1 1,568.1 47.5% Total 611.4 473.5 405.5 1,490.4 42.9% $ $ $ The  Company  is  not  economically  dependent  on  a  limited  number  of  customers  for  the  sale  of  its  product  because  gold  can   be  sold  through  numerous  commodity  market  traders  worldwide.   19. COMMITMENTS  AND  CONTINGENCIES   i. Commitments Operating  leases   The  Company  has  a  number  of  operating  lease  agreements  involving  office  space  and  equipment.    The  operating  leases  for   equipment  provide  that  the  Company  may,  after  the  initial  lease  term,  renew  the  lease  for  successive  yearly  periods  or  may   purchase  the  equipment  at  its  fair  market  value.    The  operating  leases  for  certain  office  facilities  contain  escalation  clauses   for   increases   in   operating   costs   and   property   taxes.     A   majority   of   these   leases   are   cancelable   and   are   renewable   on   a   yearly  basis.    Future  minimum  lease  payments  required  to  meet  obligations  that  have  initial  or  remaining  non-­‐cancelable   lease  terms  in  excess  of  one  year  are  $25.9  million,  $12.5  million,  $4.9  million,  $2.9  million  and  $2.9  million  for  each  year   from  2018  to  2022,  respectively,  and  $0.8  million  thereafter.       Purchase  commitments   At  December  31,  2017,  the  Company  had  future  commitments  of  approximately  $192.7  million  (December  31,  2016  –   $108.9  million)  for  capital  expenditures.       ii. Contingencies   General   Estimated  losses  from  contingencies  are  accrued  by  a  charge  to  earnings  when  information  available  prior  to  the  issuance   of  the  financial  statements  indicates  that  it  is  likely  that  a  future  event  will  confirm  that  an  asset  has  been  impaired  or  a   liability  incurred  at  the  date  of  the  financial  statements  and  the  amount  of  the  loss  can  be  reasonably  estimated.       KINROSS ANNUAL REPORT 2017 FS 56                           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Other  legal  matters   The  Company  is  from  time  to  time  involved  in  legal  proceedings,  arising  in  the  ordinary  course  of  its  business.    Typically,  the   amount  of  ultimate  liability  with  respect  to  these  actions  will  not,  in  the  opinion  of  management,  materially  affect  Kinross’   financial  position,  results  of  operations  or  cash  flows.       Maricunga  regulatory  proceedings   In  late  2013,  Compania  Minera  Maricunga  (“CMM”)  was  fined  approximately  $40,000  in  respect  of  the  degradation  of  the   Pantanillo  wetland  located  near  the  Maricunga  mine’s  water  pumping  wells.  CMM  paid  the  fine,  as  required,  and  sought   governmental  approval  of  remedial  action  plans  aimed  at  addressing  the  degradation.    CMM’s  remedial  action  plans  were   not  fully  approved  and  only  a  subset  of  CMM’s  planned  activities  were  allowed  to  be  implemented.    In  May  2015,  the  Chile   environmental  enforcement  authority  (“the  SMA”)  issued  a  resolution  alleging  that  CMM  had  irreparably  harmed  portions   of  the  Pantanillo  wetland  and  two  other  downstream  wetlands  known  respectively  as  Valle  Ancho  and  Barros  Negros,  and   that   the   mine’s   continuing   water   use   poses   an   imminent   risk   to   those   wetlands.   In   response,   CMM   submitted   legal   and   technical   defenses,   expert   reports   and   other   materials   challenging   the   SMA’s   allegations,   and,   complied   with   various   information  requests  from  the  SMA.  On  March  18,  2016,  the  SMA  issued  a  resolution  against  CMM  in  respect  of  the  SMA’s   May  2015  allegations  regarding  the  Valle  Ancho  wetland,  located  approximately  7  kilometres  downgradient  from  CMM’s   groundwater   wells,   seeking   to   impose   a   sanction   of   an   immediate   complete   curtailment   of   water   use   from   the   groundwater  wells  and  related  aquifer  (the  “sanction  proceedings”).  The  Maricunga  mine  relies  solely  on  water  from  the   Pantanillo  area  groundwater  wells  to  support  its  operations.  Beginning  in  May  2016,  the  SMA  issued  a  series  of  resolutions   ordering  CMM  to  “temporarily”  curtail  the  pumping  of  water  from  the  groundwater  wells.  In  response,  CMM  suspended   mining   and   crushing   activities   and   reduced   water   consumption   to   minimal   levels.   CMM   contested   these   resolutions   by   seeking  reconsideration  with  the  SMA  and  appealing  to  Chile’s  Environmental  Tribunal,  but  its  efforts  were  unsuccessful   and,  except  for  a  short  period  of  time  in  July  2016,  the  Company’s  operations  have  remained  suspended.  On  June  24,  2016,   the  SMA  amended  its  initial  sanction  (the  “Amended  Sanction”).  The  terms  of  the  Amended  Sanction  effectively  required   CMM  to  cease  operations  and  close  the  mine,  with  water  use  curtailed  to  levels  far  below  those  required  for  closure  in   compliance  with  the  mine’s  government-­‐approved  plan.  On  July  9,  2016,  CMM  filed  its  appeal  in  the  sanction  proceedings.   As  part  of  its  appeal,  CMM  submitted  legal  and  technical  arguments  and  reports  by  experts  on  wetland  vegetation,  analysis   of  long-­‐term  satellite  imagery  and  groundwater  hydrology  criticizing  the  evidence  relied  upon  by  the  SMA  and  concluding   that   current   data   does   not   support   an   assertion   that   CMM’s   pumping   is   negatively   impacting   water   levels   7   kilometres   downgradient  at  the  Valle  Ancho  wetland.  On  August  30,  2016,  CMM  submitted  a  request  to  the  Environmental  Tribunal   that  it  issue  an  injunction  suspending  the  effectiveness  of  the  Amended  Sanction  pending  a  final  decision  on  the  merits  of   CMM’s  appeal  of  the  Amended  Sanction.  On  September  16,  2016,  the  Environmental  Tribunal  rejected  CMM’s  injunction   request.  On  August  7,  2017,  the  Environmental  Tribunal  upheld  the  SMA’s  Amended  Sanction  and  curtailment  orders  on   purely   procedural   grounds.     No   findings   were   made   by   the   Tribunal   on   the   issue   of   whether   CMM’s   pumping   caused   damage   to   area   wetlands,   as   alleged   by   the   SMA.     On   September   27,   2017,   CMM   appealed   the   matter   to   the   Supreme   Court  of  Chile,  which  accepted  the  appeal  on  December  14,  2017.    The  timing  of  any  substantive  decision  by  the  Supreme   Court  is  uncertain.         On  June  2,  2016,  CMM  was  served  with  two  separate  lawsuits  filed  by  the  Chilean  State  Defense  Counsel.  Both  lawsuits  are   based   upon   allegations   that   CMM’s   pumping   from   its   Pantanillo   area   groundwater   wells   has   caused   damage   to   area   wetlands.  One  action  relates  to  the  Pantanillo  wetland,  and  is  based  upon  the  sanction  imposed  upon  CMM  in  late  2013  (as   described   above).   The   other   action   relates   to   the   Valle   Ancho   wetland,   and   is   largely   based   upon   the   same   factual   assertions  at  issue  in  the  SMA  sanction  proceedings.  These  lawsuits  seek,  among  other  things,  to  require  CMM  to  cease   pumping  from  the  groundwater  wells,  finance  various  investigations  and  conduct  restoration  activities.  On  June  20,  2016,   CMM   filed   its   defenses.     Evidentiary   hearings   before   the   Environmental   Tribunal   occurred   in   2016   and   early   2017,   and   closing  arguments  occurred  in  December  2017.    The  timing  of  any  substantive  decision  by  the  Environmental  Tribunal  is   uncertain.   Sunnyside  litigation   The   Sunnyside   Mine   is   an   inactive   mine   situated   in   the   so-­‐called   Bonita   Peak   Mining   District   (“District”)   near   Silverton,   Colorado.  A  subsidiary  of  Kinross,  Sunnyside  Gold  Corporation  ("SGC"),  was  involved  in  operations  at  the  mine  from  1985   through  1991  and  subsequently  conducted  various  reclamation  and  closure  activities  at  the  mine  and  in  the  surrounding   area.   In   the   third   quarter   of   2016,   the   Environmental   Protection   Agency   (the   “EPA”)   listed   the   District,   including   areas   impacted  by  SGC’s  operations  and  closure  activities,  on  the  National  Priorities  List  pursuant  to  the  Comprehensive     KINROSS ANNUAL REPORT 2017 FS 57               NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Environmental  Response,  Compensation,  and  Liability  Act  (“CERCLA”).  SGC  has  challenged  portions  of  the  CERCLA  listing  in   the   United   States   Court   of   Appeals   for   District   of   Columbia   Circuit.   The   EPA   has   notified   SGC   that   SGC   is   a   potentially   responsible  party  under  CERCLA  and  may  be  jointly  and  severally  liable  for  cleanup  of  the  District  or  cleanup  costs  incurred   by   the   EPA   in   the   District.   The   EPA   may   in   the   future   provide   similar   notification   to   Kinross.   On   August   5,   2015,   while   working  in  another  mine  in  the  District  known  as  the  Gold  King,  the  EPA  caused  a  release  of  approximately  three  million   gallons  of  contaminated  water  into  a  tributary  of  the  Animas  River.  In  the  second  quarter  of  2016,  the  State  of  New  Mexico   filed  a  Complaint  naming  the  EPA,  SGC,  Kinross  and  others  alleging  violations  of  CERCLA,  the  Resource  Conservation  and   Recovery  Act  (“RCRA”),  and  the  Clean  Water  Act  (“CWA”)  and  claiming  negligence,  gross  negligence,  public  nuisance  and   trespass.  The  Complaint  seeks  cost  recovery,  damages,  injunctive  relief,  and  attorney’s  fees.  In  the  third  quarter  of  2016,   the  Navajo  Nation  initiated  litigation  against  the  EPA,  SGC  and  Kinross,  alleging  entitlement  to  cost  recovery  under  CERCLA   for   past   and   future   costs   incurred,   negligence,   gross   negligence,   trespass,   and   public   and   private   nuisance,   and   seeking   reimbursement   of   past   and   future   costs,   compensatory,   consequential   and   punitive   damages,   injunctive   relief   and   attorneys’  fees.  The  suits  brought  by  New  Mexico  and  the  Navajo  Nation  have  been  consolidated.  In  the  third  quarter  of   2017,   the   State   of   Utah   filed   a   Complaint   naming   SGC,   Kinross   and   others   alleging   negligence,   gross   negligence,   public   nuisance,   trespass,   and   violation   of   the   Utah   Water   Quality   Act   and   the   Utah   Solid   and   Hazardous   Waste   Act.   The   Complaint   seeks   cost   recovery,   compensatory,   consequential   and   punitive   damages,   penalties,   disgorgement   of   profits,   declaratory,  injunctive  and  other  relief  under  CERCLA,  attorney’s  fees,  and  costs.     Income  taxes       The   Company   operates   in   numerous  countries   around   the   world   and   accordingly   is   subject   to,   and   pays,   annual   income   taxes   under   the   various   regimes   in   countries   in   which   it   operates.     These   tax   regimes   are   determined   under   general   corporate  income  tax  laws  of  the  country.    The  Company  has  historically  filed,  and  continues  to  file,  all  required  income  tax   returns   and   to   pay   the   taxes   reasonably   determined   to   be   due.     The   tax   rules   and   regulations   in   many   countries   are   complex   and   subject   to   interpretation.     Changes   in   tax   law   or   changes   in   the   way   that   tax   law   is   interpreted   may   also   impact   the   Company’s   effective   tax   rate   as   well   as   its   business   and   operations.     From   time   to   time   the   Company   will   undergo   a   review   of   its   historic   tax   returns   and   in   connection   with   such   reviews   disputes   can   arise   with   the   taxing   authorities  over  the  Company’s  interpretation  of  the  country’s  income  tax  rules.   KINROSS ANNUAL REPORT 2017 FS 58           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   20. RELATED  PARTY  TRANSACTIONS   There   were   no   material   related   party   transactions   in   2017   and   2016   other   than   compensation   of   key   management   personnel.   The   Company   received   no   dividends   from   Puren   during   the   year   ended   December   31,   2017   (year   ended   December   31,   2016  –  $nil).   Key  management  personnel   Compensation  of  key  management  personnel  of  the  Company  is  as  follows:   Years  ended  December  31, 2017 2016      Cash  compensation  -­‐  Salaries,  short-­‐term  incentives,  and  other  benefits      Long-­‐term  incentives,  including  share-­‐based  payments      Termination  and  post-­‐retirement  benefits Total  compensation  paid  to  key  management  personnel $                                                     $                                                     9.1 8.7 -­‐ 17.8 7.3 9.3 3.9 20.5 $                                                 $                                                 Key  management  personnel  are  defined  as  the  Senior  Leadership  Team  and  members  of  the  Board  of  Directors.   21. CONSOLIDATING  FINANCIAL  STATEMENTS   The  obligations  of  the  Company  under  the  senior  notes  are  guaranteed  by  the  following  100%  owned  subsidiaries  of  the   Company  (the  “guarantor  subsidiaries”):  Round  Mountain  Gold  Corporation,  Kinross  Brasil  Mineração  S.A.,  Fairbanks  Gold   Mining,  Inc.,  Melba  Creek  Mining,  Inc.,  KG  Mining  (Round  Mountain)  Inc.,  KG  Mining  (Bald  Mountain)  Inc.,  Red  Back  Mining   B.V.,  Red  Back  Mining  (Ghana)  Limited,  White  Ice  Ventures  Limited,  KG  Far  East  (Luxembourg)  Sarl.    All  guarantees  by  the   guarantor   subsidiaries   are   joint   and   several,   and   full   and   unconditional;   subject   to   certain   customary   release   provisions   contained  in  the  indenture  governing  the  senior  notes.   The   following   tables   contain   separate   financial   information   related   to   the   guarantor   subsidiaries   as   set   out   in   the   consolidating   balance   sheets   as   at   December   31,   2017   and   December   31,   2016   and   the   consolidating   statements   of   operations,  statements  of  comprehensive  income  (loss)  and  statements  of  cash  flows  for  the  years  ended  December  31,   2017   and   2016.     For   purposes   of   this   information,   the   financial   statements   of   Kinross   Gold   Corporation   and   of   the   guarantor  subsidiaries  reflect  investments  in  subsidiary  companies  on  an  equity  accounting  basis.       KINROSS ANNUAL REPORT 2017 FS 59                                                                                                                                                                                                                                                                     NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidating  balance  sheet  as  at  December  31,  2017   Kinross Gold Corp. Guarantor Subsidiaries Guarantor Adjustments Total Guarantors Guarantors Non- guarantors Eliminations Consolidated $ 267.6 $ 122.7 $ - $ 390.3 $ 635.5 $ - $ 1,025.8 - 10.4 518.6 - 2.1 23.0 821.7 27.6 - 180.8 - 3,535.2 14.8 11.7 3,206.4 - 5.6 26.6 - - 5.6 37.0 6.5 54.3 - - 1,297.9 (245.7) 1,570.8 4,256.8 (5,827.6) 17.1 560.6 (10.7) - - - 17.1 562.7 12.3 26.8 531.6 4.7 - - - 2,019.8 (245.7) 2,595.8 5,516.2 (5,827.6) 2,506.5 2,380.7 2,478.9 158.8 - 5.5 - - - - 3,269.1 (6,202.6) (12.3) 133.2 - - 158.8 180.8 5.5 601.7 2.5 144.9 2,414.3 (1,819.9) 3,800.8 0.1 - 0.1 3.9 7.2 18.2 - - - - 14,693.0 (15,294.7) 1.4 429.1 3,171.3 33.2 - - (6,972.1) - 12.1 91.3 - 43.9 1,094.3 17.0 2,284.4 4,887.2 162.7 188.0 23.7 - 3.9 574.0 - 33.3 $ 7,798.2 $ 10,467.4 $ (8,268.2) $ 9,997.4 $ 26,254.2 $ (28,094.4) $ 8,157.2 $ 88.5 $ 218.0 $ - $ 306.5 $ 176.1 $ - $ 482.6 184.4 - - - 272.9 1,732.6 9.8 - 1,199.3 - 3,214.6 643.0 19.5 13.5 1.1 895.1 - 367.5 67.6 2,777.2 157.4 4,264.8 (245.7) - - - (245.7) - - - (1,819.9) - (2,065.6) 581.7 19.5 13.5 1.1 922.3 1,732.6 377.3 67.6 2,156.6 157.4 5,413.8 5,245.9 (5,827.6) 15.6 53.0 - - - - - 35.1 66.5 1.1 5,490.6 (5,827.6) 585.3 - 453.2 66.4 4,815.5 98.2 - - - (6,972.1) - 10,923.9 (12,799.7) 1,732.6 830.5 134.0 - 255.6 3,538.0 $ 14,902.5 $ 1,713.3 $ (1,713.3) $ 14,902.5 $ 18,702.5 $ (18,702.5) $ 14,902.5 240.7 (10,580.7) 21.1 4,583.6 - 4,583.6 3,464.9 1,038.6 (14.2) (3,464.9) (1,038.6) 14.2 240.7 (10,580.7) 21.1 6,271.9 (9,660.3) (19.4) (6,271.9) 240.7 9,660.3 (10,580.7) 19.4 6,202.6 (6,202.6) 4,583.6 15,294.7 (15,294.7) - - - 35.6 - 6,202.6 (6,202.6) 4,583.6 15,330.3 (15,294.7) 21.1 4,583.6 35.6 4,619.2 $ 7,798.2 $ 10,467.4 $ (8,268.2) $ 9,997.4 $ 26,254.2 $ (28,094.4) $ 8,157.2 Assets Current assets Cash and cash equivalents Restricted cash Accounts receivable and other assets Intercompany receivables Current income tax recoverable Inventories Unrealized fair value of derivative assets Non-current assets Property, plant and equipment Goodwill Long-term investments Investments in associate and joint ventures Intercompany investments Unrealized fair value of derivative assets Other long-term assets Long-term intercompany receivables Deferred tax assets Total assets Liabilities Current liabilities Accounts payable and accrued liabilities Intercompany payables Current income tax payable Current portion of provisions Current portion of unrealized fair value of derivative liabilities Non-current liabilities Long-term debt Provisions Other long-term liabilities Long-term intercompany payables Deferred tax liabilities Total liabilities Equity Common shareholders' equity Common share capital Contributed surplus Accumulated deficit Accumulated other comprehensive income (loss) Total common shareholders' equity Non-controlling interest Total equity Total liabilities and equity KINROSS ANNUAL REPORT 2017 FS 60               NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidating  balance  sheet  as  at  December  31,  2016   Assets Current assets Cash and cash equivalents Restricted cash Accounts receivable and other assets Intercompany receivables Current income tax recoverable Inventories Unrealized fair value of derivative assets Non-current assets Property, plant and equipment Goodwill Long-term investments Investments in associate and joint ventures Intercompany investments Unrealized fair value of derivative assets Other long-term assets Long-term intercompany receivables Deferred tax assets Total assets Liabilities Current liabilities Accounts payable and accrued liabilities Intercompany payables Current income tax payable Current portion of provisions Current portion of unrealized fair value of derivative liabilities Non-current liabilities Long-term debt Provisions Other long-term liabilities Long-term intercompany payables Deferred tax liabilities Total liabilities Equity Common shareholders' equity Common share capital Contributed surplus Accumulated deficit Accumulated other comprehensive income (loss) Total common shareholders' equity Non-controlling interest Total equity Total liabilities and equity Kinross Gold Corp. Guarantor Subsidiaries Guarantor Adjustments Total Guarantors Guarantors Non- guarantors Eliminations Consolidated $ 126.2 $ 145.6 $ - $ 271.8 $ 555.2 $ - $ 827.0 - 6.4 541.5 - 5.7 12.6 692.4 26.8 - 141.5 - 3,150.2 19.0 8.6 3,250.6 - 4.6 42.3 - - 4.6 48.7 7.0 78.6 - - 1,277.3 (175.5) 1,643.3 4,384.9 (6,028.2) 12.0 440.3 (1.6) - - - 12.0 446.0 11.0 99.9 540.8 5.1 - - - 11.6 127.3 - 111.9 986.8 16.1 1,920.5 (175.5) 2,437.4 5,671.5 (6,028.2) 2,080.7 2,704.0 2,213.6 2,677.2 158.8 - 5.5 - - - - 1,699.7 (4,360.2) (14.7) 121.6 - - 158.8 141.5 5.5 489.7 4.3 130.2 2,084.3 (1,758.8) 3,576.1 0.7 - 0.7 3.9 1.4 158.1 - - - - 11,787.5 (12,277.2) 1.7 281.1 3,396.9 93.8 - - (6,973.0) - 4,917.6 162.7 142.9 163.6 - 6.0 411.3 - 94.5 $ 7,289.1 $ 8,653.6 $ (6,294.5) $ 9,648.2 $ 23,609.5 $ (25,278.4) $ 7,979.3 $ 72.9 $ 207.0 $ - $ 279.9 $ 184.9 $ - $ 464.8 120.1 - - 7.1 200.1 1,733.2 11.1 - 1,199.2 - 3,143.6 601.0 10.9 13.2 - 832.1 - 367.4 85.0 2,779.0 229.9 4,293.4 (175.5) - - - (175.5) - - - (1,758.8) - (1,934.3) 545.6 10.9 13.2 7.1 856.7 1,733.2 378.5 85.0 2,219.4 229.9 5,502.7 5,482.6 (6,028.2) 61.7 80.0 - - - - - 72.6 93.2 7.1 5,809.2 (6,028.2) 637.7 - 482.7 87.2 4,753.6 160.8 - - - (6,973.0) - 11,293.5 (13,001.2) 1,733.2 861.2 172.2 - 390.7 3,795.0 $ 14,894.2 $ 1,713.3 $ (1,713.3) $ 14,894.2 $ 18,053.2 $ (18,053.2) $ 14,894.2 238.3 (11,026.1) 39.1 4,145.5 - 4,145.5 2,396.0 (2,396.0) 238.3 4,402.0 (4,402.0) 238.3 243.5 7.4 (243.5) (11,026.1) (10,157.4) 10,157.4 (11,026.1) (7.4) 39.1 (20.6) 20.6 4,360.2 (4,360.2) 4,145.5 12,277.2 (12,277.2) - - - 38.8 - 4,360.2 (4,360.2) 4,145.5 12,316.0 (12,277.2) 39.1 4,145.5 38.8 4,184.3 $ 7,289.1 $ 8,653.6 $ (6,294.5) $ 9,648.2 $ 23,609.5 $ (25,278.4) $ 7,979.3 KINROSS ANNUAL REPORT 2017 FS 61         NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidating  statement  of  operations  for  the  year  ended  December  31,  2017   Revenue Metal sales Cost of sales Production cost of sales Depreciation, depletion and amortization Impairment, net of reversals Total cost of sales Gross profit Other operating expense Exploration and business development General and administrative Operating earnings (loss) Other income (expense) - net Equity in earnings (losses) of associate, joint ventures and intercompany investments Finance income Finance expense Earnings (loss) before tax Income tax recovery (expense) - net Net earnings (loss) Net earnings (loss) attributable to: Non-controlling interest Common shareholders Guarantors Kinross Gold Corp. Guarantor Subsidiaries Guarantor Adjustments Total Guarantors Non-guarantors Eliminations Consolidated $ 1,945.9 $ 1,781.1 $ (1,771.4) $ 1,955.6 $ 1,347.4 $ - $ 3,303.0 1,918.8 1,019.9 (1,772.0) 1,166.7 4.9 - 1,923.7 22.2 3.4 21.8 75.1 (78.1) (127.9) 679.4 50.6 (80.1) 443.9 1.5 404.0 164.4 1,588.3 192.8 30.7 22.1 4.7 135.3 (22.3) 232.9 27.1 (45.9) 327.1 65.4 0.6 - (1,771.4) - - - - - - (392.5) (1.9) 1.9 (392.5) - 409.5 164.4 1,740.6 215.0 34.1 43.9 79.8 57.2 (150.2) 519.8 75.8 (124.1) 378.5 66.9 590.7 409.9 (142.9) 857.7 489.7 95.5 62.1 52.8 279.3 654.4 (0.6) 79.5 (135.5) 877.1 (43.7) - - - - - - - - - (316.1) (520.5) (141.8) 141.8 (836.6) - 1,757.4 819.4 21.5 2,598.3 704.7 129.6 106.0 132.6 336.5 188.1 (1.3) 13.5 (117.8) 419.0 23.2 $ 445.4 $ 392.5 $ (392.5) $ 445.4 $ 833.4 $ (836.6) $ 442.2 $ - $ - $ - $ - $ (3.2) $ - $ (3.2) $ 445.4 $ 392.5 $ (392.5) $ 445.4 $ 836.6 $ (836.6) $ 445.4 KINROSS ANNUAL REPORT 2017 FS 62       NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidating  statement  of  operations  for  the  year  ended  December  31,  2016   Revenue Metal sales Cost of sales Production cost of sales Depreciation, depletion and amortization Impairment, net of reversals Total cost of sales Gross profit Other operating expense Exploration and business development General and administrative Operating earnings (loss) Other income (expense) - net Equity in earnings (losses) of associate, joint ventures and intercompany investments Finance income Finance expense Earnings (loss) before tax Income tax recovery (expense) - net Net earnings (loss) Net earnings (loss) attributable to: Non-controlling interest Common shareholders Guarantors Kinross Gold Corp. Guarantor Subsidiaries Guarantor Adjustments Total Guarantors Non-guarantors Eliminations Consolidated $ 2,036.4 $ 1,699.8 $ (1,653.3) $ 2,082.9 $ 1,389.1 $ - $ 3,472.0 1,999.1 8.2 - 2,007.3 29.1 7.5 20.9 93.0 (92.3) 94.6 (44.4) 25.8 (89.1) (105.4) 1.4 1,075.4 365.4 - 1,440.8 259.0 77.3 18.5 4.0 159.2 3.6 36.6 16.0 (47.5) 167.9 4.8 (1,652.7) (0.6) - (1,653.3) - - - - - - (172.7) (5.7) 5.7 (172.7) - 1,421.8 373.0 - 1,794.8 288.1 84.8 39.4 97.0 66.9 98.2 (180.5) 36.1 (130.9) (110.2) 6.2 562.0 482.0 139.6 1,183.6 205.5 124.5 54.9 46.7 (20.6) 234.2 (0.8) 74.2 (106.5) 180.5 (55.8) - - - - - - - - - (309.9) 180.1 (102.8) 102.8 (129.8) - 1,983.8 855.0 139.6 2,978.4 493.6 209.3 94.3 143.7 46.3 22.5 (1.2) 7.5 (134.6) (59.5) (49.6) $ (104.0) $ 172.7 $ (172.7) $ (104.0) $ 124.7 $ (129.8) $ (109.1) $ - $ - $ - $ - $ (5.1) $ - $ (5.1) $ (104.0) $ 172.7 $ (172.7) $ (104.0) $ 129.8 $ (129.8) $ (104.0) KINROSS ANNUAL REPORT 2017 FS 63             NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidating  statement  of  comprehensive  income  (loss)  for  the  year  ended  December  31,  2017   Kinross Gold Corp. Guarantor Subsidiaries Guarantor Adjustments Total Guarantors Guarantors Non- guarantors Eliminations Consolidated Net earnings (loss) $ 445.4 392.5 (392.5) 445.4 833.4 (836.6) 442.2 Other comprehensive income (loss), net of tax: Items to be reclassified to profit or loss in subsequent periods: Changes in fair value of investments (a) Accumulated other comprehensive loss related to investments sold (b) Changes in fair value of derivative financial instruments designated as cash flow hedges (c) Accumulated other comprehensive income (loss) related to derivatives settled (d) Equity in other comprehensive income (loss) of intercompany investments Total comprehensive income (loss) Attributable to non-controlling interest Attributable to common shareholders (a) Net of tax of (b) Net of tax of (c) Net of tax of (d) Net of tax of (15.4) (3.1) 6.8 (2.6) (14.3) (3.7) - - 5.1 (10.6) (5.5) - - - - - - 5.5 (15.4) (3.1) 11.9 (13.2) (19.8) 1.8 1.8 - - - 1.8 - - - - - - (1.8) 427.4 $ 387.0 $ (387.0) $ 427.4 $ 835.2 $ (838.4) $ - 427.4 - - 2.5 (1.0) $ $ $ $ $ $ - 387.0 - - 2.3 (4.9) $ $ $ $ $ $ - (387.0) - - - - $ $ $ $ $ $ - 427.4 - - 4.8 (5.9) $ $ $ $ $ $ (3.2) 838.4 0.3 - - - $ $ $ $ $ $ - (838.4) - - - - $ $ $ $ $ $ $ $ $ $ $ $ $ (13.6) (3.1) 11.9 (13.2) (18.0) - 424.2 (3.2) 427.4 0.3 - 4.8 (5.9) KINROSS ANNUAL REPORT 2017 FS 64           NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidating  statement  of  comprehensive  income  (loss)  for  the  year  ended  December  31,  2016   Kinross Gold Corp. Guarantor Subsidiaries Guarantor Adjustments Total Guarantors Guarantors Non- guarantors Eliminations Consolidated Net earnings (loss) $ (104.0) 172.7 (172.7) (104.0) 124.7 (129.8) (109.1) Other comprehensive income (loss), net of tax: Items to be reclassified to profit or loss in subsequent periods: Changes in fair value of investments (a) Accumulated other comprehensive loss related to investments sold (b) Changes in fair value of derivative financial instruments designated as cash flow hedges (c) Accumulated other comprehensive income (loss) related to derivatives settled (d) Equity in other comprehensive income (loss) of intercompany investments Total comprehensive income (loss) Attributable to non-controlling interest Attributable to common shareholders (a) Net of tax of (b) Net of tax of (c) Net of tax of (d) Net of tax of 49.8 (8.5) 7.4 0.5 49.2 21.2 - - 20.4 (2.7) 17.7 - - - - - - (17.7) 49.8 (8.5) 27.8 (2.2) 66.9 3.5 1.0 - 1.4 1.1 3.5 - - - - - - (3.5) (33.6) $ 190.4 $ (190.4) $ (33.6) $ 128.2 $ (133.3) $ - (33.6) - - 1.3 0.2 $ $ $ $ $ $ - 190.4 - - 8.9 (1.7) $ $ $ $ $ $ - (190.4) - - - - $ $ $ $ $ $ - (33.6) - - 10.2 (1.5) $ $ $ $ $ $ (5.1) 133.3 - - 0.4 0.4 $ $ $ $ $ $ - (133.3) - - - - $ $ $ $ $ $ $ $ $ $ $ $ $ 50.8 (8.5) 29.2 (1.1) 70.4 - (38.7) (5.1) (33.6) - - 10.6 (1.1) KINROSS ANNUAL REPORT 2017 FS 65             NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidating  statement  of  cash  flows  for  the  year  ended  December  31,  2017   Guarantors Kinross Gold Corp. Guarantor Subsidiaries Guarantor Adjustments Total Guarantors Non- guarantors Eliminations Consolidated $ 445.4 $ 392.5 $ (392.5) $ 445.4 $ 833.4 $ (836.6) $ 442.2 4.9 5.4 - 404.0 - 164.4 (679.4) (232.9) 13.6 80.1 (1.5) 132.8 - (1.7) 3.5 (4.9) (1.8) - (1.8) (5.7) - - 45.9 (69.3) (1.3) - 3.0 (69.1) 23.0 660.2 (10.9) 649.3 (410.8) - (26.2) (24.2) - 7.5 - 1.5 1.8 - (0.9) 1.9 0.8 - 494.7 (500.0) (62.9) - 235.1 (1.6) 166.1 - 141.4 126.2 - - - - - - (240.0) - (240.0) - (22.9) 145.6 0.6 - - 392.5 - (1.9) - - - - (0.6) - (1.9) - (1.9) - - - - - - - - - - - - - - 1.9 - 1.9 - 0.0 - 409.5 5.4 164.4 (519.8) 13.6 124.1 (70.8) 131.5 - 1.3 (66.2) 18.1 656.5 (10.9) 645.6 409.9 (60.6) (239.9) 0.6 - 135.5 (5.6) (163.4) 11.4 107.3 (20.5) (66.6) 941.5 (177.6) 763.9 - - - 520.5 - (141.8) - - - - - - 819.4 (55.2) (75.5) 1.3 13.6 117.8 (76.4) (31.9) 11.4 - 108.6 (86.7) (48.5) (457.9) - (457.9) 1,140.1 (188.5) 951.6 (416.5) (481.1) - - (50.4) (23.4) 1.8 7.5 (0.9) 3.4 6.7 262.1 0.4 3.2 (455.1) (232.1) 0.8 - 494.7 (500.0) (62.9) - (3.0) (1.6) (72.0) - 118.5 271.8 - - - - - (316.1) (138.8) - (454.9) 3.4 80.3 555.2 - - - - - - - - - - - - - 316.1 141.8 - 457.9 - - - (897.6) - (73.8) 8.5 269.6 (0.5) 6.6 (687.2) 0.8 - 494.7 (500.0) (62.9) - - (1.6) (69.0) 3.4 198.8 827.0 $ 267.6 $ 122.7 $ 0.0 $ 390.3 $ 635.5 $ - $ 1,025.8 Net cash flow used in investing activities (22.9) (432.2) Net inflow (outflow) of cash related to the following activities: Operating: Net earnings (loss) Adjustments to reconcile net earnings (loss) to net cash provided from (used in) operating activities: Depreciation, depletion and amortization Loss (gain) on disposition of associate and other interests - net Impairment, net of reversals Equity in losses (earnings) of associate, joint ventures and intercompany investments Share-based compensation expense Finance expense Deferred tax expense (recovery) Foreign exchange losses (gains) and other Reclamation expense Changes in operating assets and liabilities: Accounts receivable and other assets Inventories Accounts payable and accrued liabilities Cash flow provided from (used in) operating activities Income taxes paid Net cash flow provided from (used in) operating activities Investing: Additions to property, plant and equipment Business acquisition Net additions to long-term investments and other assets Net proceeds from the sale of property, plant and equipment Net proceeds from disposition of associate and other interests Decrease (increase) in restricted cash Interest received and other Financing: Issuance of common shares on exercise of options Net proceeds from issuance of equity Net proceeds from issuance of debt Repayment of debt Interest paid Dividends received from (paid to) common shareholders and subsidiaries Intercompany advances Other Net cash flow provided from (used in) financing activities Effect of exchange rate changes on cash and cash equivalents Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period KINROSS ANNUAL REPORT 2017 FS 66       NOTES  TO  THE  CONSOLIDATED  FINANCIAL  STATEMENTS     For  the  years  ended  December  31,  2017  and  2016     (Tabular  amounts  in  millions  of  United  States  dollars)   Consolidating  statement  of  cash  flows  for  the  year  ended  December  31,  2016   Net inflow (outflow) of cash related to the following activities: Operating: Net earnings (loss) Adjustments to reconcile net earnings (loss) to net cash provided from (used in) operating activities: Depreciation, depletion and amortization Loss (gain) on disposition of associate and other interests - net Impairment, net of reversals Equity in losses (earnings) of associate, joint ventures and intercompany investments Share-based compensation expense Finance expense Deferred tax expense (recovery) Foreign exchange losses (gains) and other Reclamation expense Changes in operating assets and liabilities: Accounts receivable and other assets Inventories Accounts payable and accrued liabilities Cash flow provided from (used in) operating activities Income taxes paid Net cash flow provided from (used in) operating activities Investing: Additions to property, plant and equipment Business acquisition Net additions to long-term investments and other assets Net proceeds from the sale of property, plant and equipment Net proceeds from disposition of associate and other interests Decrease (increase) in restricted cash Interest received and other Net cash flow used in investing activities Financing: Issuance of common shares on exercise of options Proceeds from issuance of equity Proceeds from issuance of debt Repayment of debt Interest paid Dividends received from (paid to) common shareholders and subsidiaries Intercompany advances Other Net cash flow provided from (used in) financing activities Effect of exchange rate changes on cash and cash equivalents Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period Guarantors Kinross Gold Corp. Guarantor Subsidiaries Guarantor Adjustments Total Guarantors Non- guarantors Eliminations Consolidated $ (104.0) $ 172.7 $ (172.7) $ (104.0) $ 124.7 $ (129.8) $ (109.1) 365.4 (0.6) 373.0 8.2 - - 44.4 13.5 89.1 (1.5) (67.3) - (2.3) (4.1) 0.5 (23.5) - (23.5) (5.5) - (8.7) - - - 0.7 (13.5) 2.8 275.7 175.0 (425.0) (73.5) - 97.7 (3.3) 49.4 - 12.4 113.8 - - (36.6) - 47.5 (57.5) 70.2 - (23.3) (22.6) 112.3 628.1 (20.5) 607.6 (291.2) (588.0) (28.5) 0.6 - (1.6) 1.2 (907.5) - - - - - - 318.5 - 318.5 - 18.6 127.0 - - 172.7 - (5.7) - - - - 0.6 - (5.7) - (5.7) - - - - - - - - - - - - - - 5.7 - 5.7 - - - - - 180.5 13.5 130.9 (59.0) 2.9 - (25.6) (26.1) 112.8 598.9 (20.5) 578.4 (296.7) (588.0) 482.0 - 139.6 0.8 - 106.5 (90.7) 11.5 27.2 4.4 105.6 127.1 1,038.7 (105.2) 933.5 (337.1) - (37.2) (22.6) 0.6 - (1.6) 1.9 8.5 - 0.5 1.6 (921.0) (349.1) 2.8 275.7 175.0 (425.0) (73.5) - 421.9 (3.3) 373.6 - 31.0 240.8 - - - - - (309.9) (524.7) - (834.6) 2.3 (247.9) 803.1 - - - (180.1) - (102.8) - - - - - - (412.7) - (412.7) - - - - - - - - - - - - - 309.9 102.8 - 412.7 - - - 855.0 - 139.6 1.2 13.5 134.6 (149.7) 14.4 27.2 (21.2) 79.5 239.9 1,224.9 (125.7) 1,099.2 (633.8) (588.0) (59.8) 9.1 - (1.1) 3.5 (1,270.1) 2.8 275.7 175.0 (425.0) (73.5) - - (3.3) (48.3) 2.3 (216.9) 1,043.9 $ 126.2 $ 145.6 $ - $ 271.8 $ 555.2 $ - $ 827.0 KINROSS ANNUAL REPORT 2017 FS 67         MINERAL RESERVE AND MINERAL RESOURCE STATEMENT PROVEN AND PROBABLE MINERAL RESERVES Gold Proven and Probable Mineral Reserves (1, 3, 4, 5, 6, 8) Kinross Gold Corporation’s Share at December 31, 2017 Property Location Kinross Interest (%) NORTH AMERICA Bald Mountain Fort Knox Area Round Mountain Area Subtotal SOUTH AMERICA La Coipa 8 Paracatu USA USA USA 100.0% 100.0% 100.0% Chile Brazil 100.0% 100.0% Subtotal AFRICA Chirano Tasiast Subtotal RUSSIA Dvoinoye Kupol Subtotal Total Gold Ghana Mauritania 90.0% 100.0% Russia Russia 100.0% 100.0% Proven Probable Proven and Probable Tonnes (kt) Grade (g/t) Ounces (koz) Tonnes (kt) Grade (g/t) Ounces (koz) Tonnes (kt) Grade (g/t) Ounces (koz) 6,490 23,671 49,266 79,427 59 511,127 511,186 3,639 30,535 34,174 1,287 770 2,057 626,844 0.7 0.5 0.5 0.5 1.6 0.4 0.4 1.0 1.2 1.2 5.2 6.2 5.6 0.5 143 357 853 88,726 65,187 75,116 1,353 229,029 3 6,805 15,603 131,194 6,808 146,797 122 1,191 4,662 94,254 1,313 98,916 216 155 371 1,296 4,808 6,104 9,845 480,846 0.5 0.4 0.8 0.6 1.7 0.5 0.6 3.0 2.2 2.2 8.6 8.3 8.4 1.0 1,555 888 2,031 95,216 88,858 124,382 4,474 308,456 841 2,019 15,662 642,321 2,860 657,983 445 6,670 8,301 124,789 7,115 133,090 360 1,280 1,640 2,583 5,578 8,161 16,089 1,107,690 0.6 0.4 0.7 0.6 1.7 0.4 0.5 2.1 2.0 2.0 6.9 8.0 7.7 0.7 1,698 1,245 2,884 5,827 844 8,824 9,668 567 7,861 8,428 576 1,435 2,011 25,934 Silver Proven and Probable Mineral Reserves (1, 3, 4, 5, 6, 8) Kinross Gold Corporation’s Share at December 31, 2017 Property Location Kinross Interest (%) NORTH AMERICA Round Mountain Area Subtotal SOUTH AMERICA La Coipa 8 USA 100.0% Chile 100.0% Subtotal RUSSIA Dvoinoye Kupol Subtotal Total Silver Russia Russia 100.0% 100.0% Proven Probable Proven and Probable Tonnes (kt) Grade (g/t) Ounces (koz) Tonnes (kt) Grade (g/t) Ounces (koz) Tonnes (kt) Grade (g/t) Ounces (koz) 3,652 3,652 6.1 6.1 59 59 152.9 152.9 1,287 770 2,057 5,768 9.7 81.8 36.7 18.5 713 713 291 291 3,641 3,641 5.6 5.6 658 658 7,293 7,293 5.8 5.8 1,371 1,371 15,603 67.6 33,897 15,662 67.9 34,188 15,603 67.6 33,897 15,662 67.9 34,188 402 2,025 2,427 1,296 4,808 6,104 13.1 91.1 544 14,086 74.6 14,630 2,583 5,578 8,161 11.4 89.8 946 16,111 65.0 17,057 3,431 25,348 60.4 49,185 31,116 52.6 52,616 68 KINROSS ANNUAL REPORT 2017 MEASURED AND INDICATED MINERAL RESOURCES Gold Measured and Indicated Mineral Resources (Excludes Proven and Probable Mineral Reserves) (2, 3, 4, 5, 6, 7, 8) Kinross Gold Corporation’s Share at December 31, 2017 Property Location Kinross Interest (%) Measured Indicated Measured and Indicated Tonnes (kt) Grade (g/t) Ounces (koz) Tonnes (kt) Grade (g/t) Ounces (koz) Tonnes (kt) Grade (g/t) Ounces (koz) NORTH AMERICA Bald Mountain Fort Knox Area Round Mountain Area Subtotal SOUTH AMERICA La Coipa 8 Lobo Marte Maricunga Paracatu USA USA USA 100.0% 100.0% 100.0% Chile Chile Chile Brazil 100.0% 100.0% 100.0% 100.0% Subtotal AFRICA Chirano Tasiast Subtotal RUSSIA Dvoinoye Kupol Subtotal Total Gold Ghana Mauritania 90.0% 100.0% Russia Russia 100.0% 100.0% 21,853 24,606 2,378 48,837 5,305 96,646 35,908 164,286 302,145 3,075 4,936 8,011 – 75 75 359,068 0.7 0.4 0.4 0.5 1.8 1.1 0.8 0.3 0.6 1.7 0.7 1.1 – 8.9 8.9 0.6 465 320 30 158,485 213,425 102,683 815 474,593 304 3,525 937 1,530 9,849 88,720 209,097 158,541 6,296 466,207 7,900 69,655 77,555 166 113 279 – 21 21 0.6 0.4 0.7 0.5 1.9 1.2 0.7 0.3 0.7 2.3 1.3 1.4 2,884 2,909 2,363 180,338 238,031 105,061 8,156 523,430 599 3,489 4,492 1,719 15,154 185,366 245,005 322,827 10,299 768,352 580 2,846 10,975 74,591 3,426 85,566 0.6 0.4 0.7 0.5 1.9 1.2 0.7 0.3 0.7 2.1 1.2 1.3 3,349 3,229 2,393 8,971 903 7,014 5,429 3,249 16,595 746 2,959 3,705 6 317 323 28 826 854 6.2 11.2 11.0 6 296 302 28 901 929 6.2 11.0 10.8 7,411 1,019,209 0.7 22,183 1,378,277 0.7 29,594 Silver Measured and Indicated Mineral Resources (Excludes Proven and Probable Mineral Reserves) (2, 3, 4, 5, 6, 7, 8) Kinross Gold Corporation’s Share at December 31, 2017 Property Location Kinross Interest (%) NORTH AMERICA Round Mountain Area Subtotal SOUTH AMERICA La Coipa 8 USA 100.0% Chile 100.0% Subtotal RUSSIA Dvoinoye Kupol Subtotal Total Silver Russia Russia 100.0% 100.0% Measured Indicated Measured and Indicated Tonnes (kt) Grade (g/t) Ounces (koz) Tonnes (kt) Grade (g/t) Ounces (koz) Tonnes (kt) Grade (g/t) Ounces (koz) 2,378 2,378 5,305 5,305 8.7 8.7 37.1 37.1 – 75 75 – 126.4 126.4 667 667 6,330 6,330 – 303 303 5,309 5,309 9,849 9,849 28 826 854 6.8 6.8 1,160 1,160 7,687 7,687 7.4 7.4 1,827 1,827 74.0 23,445 15,154 61.1 29,775 74.0 23,445 15,154 61.1 29,775 6.0 135.5 5 3,598 131.3 3,603 28 901 929 6.0 134.8 5 3,901 130.9 3,906 7,758 29.3 7,300 16,012 54.8 28,208 23,770 46.5 35,508 KINROSS ANNUAL REPORT 2017 69 INFERRED MINERAL RESOURCES Gold Inferred Mineral Resources (2, 3, 4, 5, 6, 7, 8) Kinross Gold Corporation’s Share at December 31, 2017 Property NORTH AMERICA Bald Mountain Fort Knox Area Round Mountain Area Subtotal SOUTH AMERICA La Coipa 8 Lobo Marte Maricunga Paracatu Subtotal AFRICA Chirano Tasiast Subtotal RUSSIA Dvoinoye Kupol Subtotal Total Gold Silver Inferred Mineral Resources (2, 3, 4, 5, 6, 7, 8) Kinross Gold Corporation’s Share at December 31, 2017 Property NORTH AMERICA Round Mountain Area Subtotal SOUTH AMERICA La Coipa 8 Subtotal RUSSIA Dvoinoye Kupol Subtotal Total Silver 70 KINROSS ANNUAL REPORT 2017 Kinross Interest (%) Location Inferred Tonnes (kt) Grade (g/t) Ounces (koz) USA USA USA 100.0% 100.0% 100.0% Chile Chile Chile Brazil 100.0% 100.0% 100.0% 100.0% Ghana Mauritania 90.0% 100.0% Russia Russia 100.0% 100.0% 43,305 56,458 89,078 188,841 2,121 2,003 53,133 31,033 88,290 1,590 41,771 43,361 14 489 503 320,995 0.4 0.4 0.7 0.6 1.5 1.1 0.6 0.2 0.5 3.0 0.9 1.0 11.8 9.3 9.4 0.6 597 689 2,115 3,401 101 69 1,044 227 1,441 152 1,237 1,389 5 146 151 6,382 Inferred Tonnes (kt) Grade (g/t) Ounces (koz) Kinross Interest (%) Location USA 100.0% 960 960 Chile 100.0% 2,121 Russia Russia 100.0% 100.0% 2,121 14 489 503 1.7 1.7 45.2 45.2 54 54 3,081 3,081 10.7 131.2 5 2,062 127.8 2,067 3,584 45.1 5,202 Mineral Reserve and Mineral Resource Statement Notes (1) Unless otherwise noted, the Company’s mineral reserves are estimated using appropriate cut-off grades based on an assumed gold price of $US 1,200 per ounce and a silver price of $US 17.00 per ounce. Mineral reserves are estimated using appropriate process recoveries, operating costs and mine plans that are unique to each property and include estimated allowances for dilution and mining recovery. Mineral reserve estimates are reported in contained units and are estimated based on the following foreign exchange rates: Russian Rouble to $US 60 Chilean Peso to $US 650 Brazilian Real to $US 3.25 Ghanaian Cedi to $US 4.00 Mauritanian Ouguiya to $US 330 (2) Unless otherwise noted, the Company’s mineral resources are estimated using appropriate cut-off grades based on a gold price of $US 1,400 per ounce and a silver price of $US 20.00 per ounce. Foreign exchange rates for estimating mineral resources were the same as for mineral reserves. (3) The Company’s mineral reserve and mineral resource estimates as at December 31, 2017 are classified in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) “CIM Definition Standards – For Mineral Resources and Mineral Reserves” adopted by the CIM Council (as amended, the “CIM Definition Standards”) in accordance with the requirements of National Instrument 43-101 “Standards of Disclosure for Mineral Projects” (“NI 43-101”). Mineral reserve and mineral resource estimates reflect the Company’s reasonable expectation that all necessary permits and approvals will be obtained and maintained. (4) Cautionary note to U.S. investors concerning estimates of mineral reserves and mineral resources. These estimates have been prepared in accordance with the requirements of Canadian securities laws, which differ from the requirements of United States’ securities laws. The terms “mineral reserve”, “proven mineral reserve” and “probable mineral reserve” are Canadian mining terms as defined in accordance with NI 43-101 and the CIM Definition Standards. The CIM Definition Standards differ from the definitions in the United States Securities and Exchange Commission (“SEC”) Guide 7 (“SEC Guide 7”) under the United States Securities Act of 1933, as amended. Under SEC Guide 7, a “final” or “bankable” feasibility study is required to report mineral reserves, the three-year historical average price is used in any mineral reserve or cash flow analysis to designate mineral reserves and the primary environmental analysis or report must be filed with the appropriate governmental authority. In addition, the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in NI 43-101 and recognized by Canadian securities laws but are not defined terms under SEC Guide 7 or recognized under U.S. securities laws. U.S. investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be upgraded to mineral reserves. “Inferred mineral resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an “inferred mineral resource” will ever be upgraded to a higher category. Under Canadian securities laws, estimates of “inferred mineral resources” may not form the basis of feasibility or pre-feasibility studies, except in rare cases. U.S. investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Accordingly, these mineral reserve and mineral resource estimates and related information may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal laws and the rules and regulations thereunder, including SEC Guide 7. (5) (6) The Company’s mineral resource and mineral reserve estimates were prepared under the supervision of and verified by Mr. John Sims, an officer of Kinross, who is a qualified person as defined by NI 43-101. The Company’s normal data verification procedures have been used in collecting, compiling, interpreting and processing the data used to estimate mineral reserves and mineral resources. Independent data verification has not been performed. (7) Mineral resources that are not mineral reserves do not have to demonstrate economic viability. Mineral resources are subject to infill drilling, permitting, mine planning, mining dilution and recovery losses, among other things, to be converted into mineral reserves. Due to the uncertainty associated with inferred mineral resources, it cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to indicated or measured mineral resources, including as a result of continued exploration. (8) Includes mineral resources from the Puren deposit in which the Company holds a 65% interest. Mineral resources for the Phase 7 project are reported at 100% ownership. Kinross currently holds a 50% interest in the Phase 7 project but has entered into an agreement whereby it has agreed to purchase the other 50% that it does not currently own. KINROSS ANNUAL REPORT 2017 71 MINERAL RESERVE AND MINERAL RESOURCE DEFINITIONS A ‘Mineral Resource’ is a concentration or occurrence of solid material of economic interest in or on the Earth’s crust in such form, grade or quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade or quality, continuity and other geological characteristics of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge, including sampling. An ‘Inferred Mineral Resource’ is that part of a Mineral Resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological and grade or quality continuity. An Inferred Mineral Resource has a lower level of confidence than that applying to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that the majority of Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration. An ‘Indicated Mineral Resource’ is that part of a Mineral Resource for which quantity, grade or quality, densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of Modifying Factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit. Geological evidence is derived from adequately detailed and reliable exploration, sampling and testing and is sufficient to assume geological and grade or quality continuity between points of observation. An Indicated Mineral Resource has a lower level of confidence than that applying to a Measured Mineral Resource and may only be converted to a Probable Mineral Reserve. A ‘Measured Mineral Resource’ is that part of a Mineral Resource for which quantity, grade or quality, densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application of Modifying Factors to support detailed mine planning and final evaluation of the economic viability of the deposit. Geological evidence is derived from detailed and reliable exploration, sampling and testing and is sufficient to confirm geological and grade or quality continuity between points of observation. A Measured Mineral Resource has a higher level of confidence than that applying to either an Indicated Mineral Resource or an Inferred Mineral Resource. It may be converted to a Proven Mineral Reserve or to a Probable Mineral Reserve. A ‘Mineral Reserve’ is the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted and is defined by studies at Pre-Feasibility or Feasibility level as appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified. The reference point at which Mineral Reserves are defined, usually the point where the ore is delivered to the processing plant, must be stated. It is important that, in all situations where the reference point is different, such as for a saleable product, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported. The public disclosure of a Mineral Reserve must be demonstrated by a Pre- Feasibility Study or Feasibility Study. A ‘Probable Mineral Reserve’ is the economically mineable part of an Indicated, and in some circumstances, a Measured Mineral Resource. The confidence in the Modifying Factors applying to a Probable Mineral Reserve is lower than that applying to a Proven Mineral Reserve. A ‘Proven Mineral Reserve’ is the economically mineable part of a Measured Mineral Resource. A Proven Mineral Reserve implies a high degree of confidence in the Modifying Factors. 72 KINROSS ANNUAL REPORT 2017 SUMMARIZED FIVE-YEAR REVIEW (5, 6) (in millions, except per share amounts) Operating results from continuing operations 2017 2016 2015 2014 2013 Production (attributable) (Au eq. oz.) 2,673,533 2,789,150 2,594,652 2,710,390 2,631,092 Revenue Production cost of sales (per Au eq. oz.) Net earnings (loss) attributable to common shareholders Net cash flow provided from operating activities Capital expenditures Financial position $ $ $ $ $ 3,303.0 $ 3,472.0 669 445.4 951.6 897.6 $ $ $ $ 712 (104.0) 1,099.2 633.8 $ $ $ $ $ 3,052.2 696 (984.5) 831.6 610.0 $ $ $ $ $ 3,466.3 720 (1,400.0) 858.1 631.8 Cash, cash equivalents and short-term investments $ 1,025.8 $ 827.0 $ 1,043.9 $ 983.5 $ $ $ $ $ $ $ 3,779.5 743 (3,012.6) 796.6 1,262.4 734.5 1,692.9 Working capital Total assets Long-term debt (including current portion) Common shareholders’ equity Per share data $ $ $ $ 1,699.1 8,157.2 1,732.6 4,583.6 $ $ $ $ 1,443.0 7,979.3 1,733.2 4,145.5 $ $ $ $ 1,590.3 7,735.4 1,981.4 3,889.3 $ $ $ $ 1,982.7 8,951.4 $ 10,286.7 2,058.1 4,843.0 $ $ 2,119.6 6,014.0 Net earnings (loss) attributable to common shareholders – basic $ 0.36 $ (0.08) $ (0.86) $ (1.22) $ (2.64) Market Average realized gold price per ounce $ 1,260.0 $ 1,249.0 $ 1,159.0 $ 1,263.0 $ 1,402.0 2017 KINROSS SHARE TRADING DATA TSX (Cdn dollars) First quarter Second quarter Third quarter Fourth quarter NYSE (U.S. dollars) First quarter Second quarter Third quarter Fourth quarter High Low $ $ $ $ $ $ $ $ 5.55 6.30 5.96 5.70 4.23 4.66 4.91 4.52 $ $ $ $ $ $ $ $ 4.20 4.56 4.81 4.85 3.13 3.35 3.73 3.78 KINROSS ANNUAL REPORT 2017 73 CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION All statements, other than statements of historical fact, contained or incorporated by reference in this Annual Report including, but not limited to, any information as to the future financial or operating performance of Kinross, constitute ‘‘forward-looking information’’ or ‘‘forward-looking statements’’ within the meaning of certain securities laws, including the provisions of the Securities Act (Ontario) and the provisions for ‘‘safe harbor’’ under the United States Private Securities Litigation Reform Act of 1995 and are based on expectations, estimates and projections as of the date of this Annual Report. Forward-looking statements contained in this Annual Report include, but are not limited to, those under the headings (or headings that include): “CEO Letter to Shareholders”, 2017 Achievements”, “Our History” and include, without limitation, statements with respect to our guidance for production, production costs of sales, all-in sustaining cost and capital expenditures; the schedules and budgets for the Company’s development projects; and continuous improvement initiatives, as well as references to other possible events, the future price of gold and silver, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of projects and new deposits, success of exploration, development and mining activities, currency fluctuations, capital requirements, project studies, mine life extensions, restarting suspended or disrupted operations; and resolution of pending litigation. The words “advance”, “anticipate”, “assumption”, “believe”, “estimates”, ‘‘expects’’, “forecast”, “focus”, “forward”, “guidance”, “initiative”, “measures”, “on budget”, “outlook”, “opportunity”, “plan”, “potential”, “progress”, “project”, “projection”, “well positioned”, or variations of or similar such words and phrases or statements that certain actions, events or results may, could, should or will be achieved, received or taken, or will occur or result and similar such expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Kinross as of the date of such statements, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The estimates, models and assumptions of Kinross referenced, contained or incorporated by reference in this Annual Report, which may prove to be incorrect, include, but are not limited to, the various assumptions set forth herein and in our most recently filed Annual Information Form and our Management’s Discussion and Analysis (MD&A) as well as: (1) there being no significant disruptions affecting the operations of the Company whether due to extreme weather events (including, without limitation, excessive or lack of rainfall, in particular, the potential for further production curtailments at Paracatu resulting from insufficient rainfall) and other or related natural disasters, labour disruptions (including but not limited to workforce reductions), supply disruptions, power disruptions, damage to equipment or otherwise; (2) permitting, development, operations and production from the Company’s operations being consistent with Kinross’ current expectations including, without limitation, the maintenance of existing permits and approvals and the timely receipt of all permits and authorizations necessary for the development and operation of the Tasiast Phase Two expansion and the Round Mountain Phase W expansion including, without limitation, work permits, necessary import authorizations for goods and equipment and exploration licence conversions at Tasiast; and land acquisitions and permitting for the construction and operation of the new tailings facility, water and power supply and launch of the new tailings reprocessing facility at Paracatu; (3) political and legal developments in any jurisdiction in which the Company operates being consistent with its current expectations including, without limitation, the impact of any political tensions and uncertainty in the Russian Federation and Ukraine or any related sanctions and any other similar restrictions or penalties imposed, or actions taken, by any government, including but not limited to potential power rationing, tailings facility regulation and amendments to mining laws in Brazil, potential amendments to water laws and/or other water use restrictions and regulatory actions in Chile, potential amendments to minerals and mining laws, energy levies laws, and dam safety regulation in Ghana, potential amendments to customs and mining laws (including, but not limited, amendments to the VAT) and regulations relating to work permits in Mauritania, the potential passing of Environmental Protection Agency regulations in the U.S. relating to the provision of financial assurances under the Comprehensive Environmental Response, Compensation and Liability Act, and potential amendments to and enforcement of tax laws in Russia (including, but not limited to, the interpretation, implementation, application and enforcement of any such laws and amendments thereto), being consistent with Kinross’ current expectations; (4) the exchange rate between the Canadian dollar, Brazilian real, Chilean peso, Russian rouble, Mauritanian ouguiya, Ghanaian cedi and the U.S. dollar being approximately consistent with current levels; (5) certain price assumptions for gold and silver; (6) prices for diesel, natural gas, fuel oil, electricity and other key supplies being approximately consistent with current levels; (7) production and cost of sales forecasts for the Company meeting expectations; (8) the accuracy of the current mineral reserve and mineral resource estimates of the Company (including, but not limited to, ore tonnage and ore grade estimates) and mine plans for the Company’s mining operations (including, but not limited to, throughput and recoveries being affected by metallurgical characteristics at Paracatu); (9) labour and materials costs increasing on a basis consistent with Kinross’ current expectations; (10) the terms and conditions of the legal and fiscal stability agreements for the Tasiast and Chirano operations being interpreted and applied in a manner consistent with their intent and Kinross’ expectations; (11) goodwill and/or asset impairment potential; (12) the regulatory and legislative regime regarding mining, electricity production and transmission (including rules related to power tariffs) in Brazil being consistent with Kinross’ current 74 KINROSS ANNUAL REPORT 2017 expectations; and (13) access to capital markets including, but not limited to, maintaining a debt rating consistent with the Company’s current expectations. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Such factors include, but are not limited to: sanctions (any other similar restrictions or penalties) now or subsequently imposed, other actions taken, by, against, in respect of or otherwise impacting any jurisdiction in which the Company is domiciled or operates (including, but not limited to, the Russian Federation, Canada, the European Union and the United States), or any government or citizens of, persons or companies domiciled in, or the Company’s business, operations or other activities in, any such jurisdiction; fluctuations in the currency markets; fluctuations in the spot and forward price of gold or certain other commodities (such as fuel and electricity); changes in the discount rates applied to calculate the present value of net future cash flows based on country-specific real weighted average cost of capital; changes in the market valuations of peer group gold producers and the Company, and the resulting impact on market price to net asset value multiples; changes in various market variables, such as interest rates, foreign exchange rates, gold or silver prices and lease rates, or global fuel prices, that could impact the mark-to-market value of outstanding derivative instruments and ongoing payments/receipts under any financial obligations; risks arising from holding derivative instruments (such as credit risk, market liquidity risk and mark-to-market risk); changes in national and local government legislation, taxation (including, but not limited to, income tax, advance income tax, stamp tax, withholding tax, capital tax, tariffs, value-added or sales tax, capital outflow tax, capital gains tax, windfall or windfall profits tax, royalty, excise tax, customs/import or export taxes/duties, asset taxes, asset transfer tax, property use or other real estate tax, together with any related fine, penalty, surcharge, or interest imposed in connection with such taxes), controls, policies and regulations; the security of personnel and assets; political or economic developments in Canada, the United States, Chile, Brazil, Russia, Mauritania, Ghana, or other countries in which Kinross does business or may carry on business; business opportunities that may be presented to, or pursued by, us; our ability to successfully integrate acquisitions and complete divestitures; operating or technical difficulties in connection with mining or development activities; employee relations; litigation or other claims against, or regulatory investigations and/or any enforcement actions or sanctions in respect of the Company (and/or its directors, officers, or employees) including, but not limited to, securities class action litigation in Canada and/or the United States, or any investigations, enforcement actions and/or sanctions under any applicable anti-corruption, international sanctions and/or anti-money laundering laws and regulations in Canada, the United States or any other applicable jurisdiction; the speculative nature of gold exploration and development including, but not limited to, the risks of obtaining necessary licences and permits; diminishing quantities or grades of reserves; adverse changes in our credit rating; and contests over title to properties, particularly title to undeveloped properties. In addition, there are risks and hazards associated with the business of gold exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion losses (and the risk of inadequate insurance, or the inability to obtain insurance, to cover these risks). Many of these uncertainties and contingencies can directly or indirectly affect, and could cause, Kinross’ actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of Kinross, including but not limited to, resulting in an impairment charge on goodwill and/or assets. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management’s expectations and plans relating to the future. All of the forward-looking statements made in this Annual Report are qualified by these cautionary statements and those made in our other filings with the securities regulators of Canada and the United States including, but not limited to, the cautionary statements made in the ‘‘Risk Factors’’ section of our most recently filed Annual Information Form and the “Risk Analysis” section of our full year 2017 MD&A. These factors are not intended to represent a complete list of the factors that could affect Kinross. Kinross disclaims any intention or obligation to update or revise any forward-looking statements or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law. KINROSS ANNUAL REPORT 2017 75 Key Sensitivities Approximately 70%-80% of the Company’s costs are denominated in U.S. dollars. A 10% change in foreign currency exchange rates would be expected to result in an approximate $17 impact on production cost of sales per ounce.7 Specific to the Russian rouble, a 10% change in the exchange rate would be expected to result in an approximate $19 impact on Russian production cost of sales per ounce. Specific to the Brazilian real, a 10% change in the exchange rate would be expected to result in an approximate $38 impact on Brazilian production cost of sales per ounce. A $10 per barrel change in the price of oil would be expected to result in an approximate $3 impact on production cost of sales per ounce. A $100 change in the price of gold would be expected to result in an approximate $4 impact on production cost of sales per ounce as a result of a change in royalties. Other information Where we say ‘‘we’’, ‘‘us’’, ‘‘our’’, the ‘‘Company’’, or ‘‘Kinross’’ in this Annual Report, we mean Kinross Gold Corporation and/or one or more or all of its subsidiaries, as may be applicable. The technical information about the Company’s mineral properties contained in this Annual Report has been prepared under the supervision of Mr. John Sims, an officer of the Company who is a “qualified person” within the meaning of National Instrument 43-101. ENDNOTES 1 These figures are non-GAAP financial measures and are defined and reconciled in Section 11, Supplemental Information of Management’s Discussion and Analysis. 2 Unless otherwise stated, production figures in this Annual Report are based on Kinross’ 90% share of Chirano production. 3 Kinross’ guidance and outlook for 2018 represents forward-looking information and users are cautioned that actual results may vary. Forecasts for production, production cost of sales, all-in sustaining costs and capital expenditures are + or – 5 %. Please refer to the Cautionary Statement on page 74, as well as the Company’s News Release dated February 14, 2018, available on our website at Kinross.com. 4 See Mineral Reserve and Mineral Resource Statement in this 2017 Annual Report, page 68, and news release dated February 14, 2018 titled “Kinross provides update on organic development projects and full-year 2017 exploration results”. 5 Reported net earnings includes a non-cash impairment charge, net of reversals, of $21.5 million in 2017 (2016: $139.6 million; 2015: $699.0 million). 6 On June 10, 2013, the Company announced its decision to cease development of Fruta del Norte (FDN). As a result, FDN was classified as a discontinued operation. On December 17, 2014, the Company sold its interest in FDN. The comparative results exclude FDN. 7 Refers to all currencies in the countries where the Company has mining operations, fluctuating simultaneously by 10% in the same direction, either appreciating, or depreciating, taking into consideration the impact of hedging and the weighting of each currency within our consolidated cost structure. 8 Average realized gold price is a non-GAAP financial measure and is defined in Section 11, Supplemental Information of Management’s Discussion and Analysis. 76 KINROSS ANNUAL REPORT 2017 Publications To obtain copies of Kinross’ publications, please visit our corporate website at Kinross.com, or contact us by email at info@kinross.com or call 1-866-561-3636. Corporate Responsibility Report Kinross publishes its corporate responsibility performance data annually and a comprehensive Global Reporting Initiative Report every two years. In 2018, we will publish our 2017 Corporate Responsibility Report online at 2017corporateresponsibilityreport. kinross.com. Corporate Information Corporate Information Transfer Agent and Registrar Computershare Investor Services Inc. Toronto, Ontario, Canada Toll-free: 1-800-564-6253 Proxy Solicitation Agent Kingsdale Advisors Toronto, Ontario, Canada Annual Shareholders Meeting Wednesday, May 9th, 2018 at 10:00 a.m. EDT at the Glenn Gould Studio, 250 Front Street West, Toronto, Ontario, Canada Trading Data TSX K – common NYSE KGC – common Legal Counsel Osler, Hoskin & Harcourt LLP Toronto, Ontario, Canada Sullivan & Cromwell LLP New York, New York, United States Auditors KPMG LLP Toronto, Ontario, Canada @KinrossGold Contact Information General Kinross Gold Corporation 25 York Street, 17th Floor Toronto, Ontario, Canada M5J 2V5 Website: Kinross.com Telephone: 416-365-5123 Toll-freee: 1-866-561-3636 Facsimile: 416-363-6622 Email: info@kinross.com Investor Relations Tom Elliott, Senior Vice-President, Investor Relations and Corporate Development Telephone: 416-365-3390 Email: tom.elliott@kinross.com Media Relations Louie Diaz, Director, Corporate Communications Telephone: 416-369-6469 Email: louie.diaz@kinross.com Corporate Responsibility Ed Opitz, Vice-President, Safety and Sustainabillity Telephone: 416-369-6476 Email: ed.opitz@kinross.com Shareholder Inquiries Computershare Investor Services Inc. 9th Floor, 100 University Avenue Toronto, Ontario, Canada, M5J 2Y1 Toll-free: 1-800-564-6253 Toll-free facsimile: 1-888-453-0330 designed and produced by: www.smithandassoc.com Please recycle. ifc-rev.pdf - p1 (March 15, 2018 21:11:34) DT KINROSS GOLD CORPORATION 25 York Street, 17th Floor Toronto, Ontario M5J 2V5 Canada 

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