Good morning. My name is Ian, and I will be your conference operator today. At this time, I would like to welcome everyone to the Kinross Gold Operations Update. At this, all participants are in a listen-only mode to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star, then the number 1 on your telephone keypad. If you would like to withdraw your question, press the pound key. Thank you. At this time, I would like to turn the call over to Mr. Tom Elliott, Senior Vice President, Investor Relations. Mr. Elliott, you may begin your conference.
Thank you, and good morning. Before we begin, I'd like to bring to your attention the fact that we will be making forward-looking statements during this presentation. For a complete discussion of the risks, uncertainties, and assumptions which may lead to actual results and performance being different from estimates contained in our forward-looking information, please refer to page two and three of this presentation, our news release dated October 20th, 2020, the MD&A for the period ending June 30th, 2020, and our most recently filed AIF, all of which are available on our website. With us today, we have Paul Rollinson, Chief Executive Officer, Paul Tomory, Chief Technical Officer, and four senior members of our technical team, John Sims and Richard Adolfo for geology, Scott Hicks for mine planning, and Yves Breau for metallurgy. With that, I'll turn the call over to Paul.
Thanks, Tom. Thank you, everyone, for joining us today. Before we get started, I just want to reiterate what our objective is here today. We're here to provide a technical update on our operations and projects that we feel underpin a positive story for Kinross. We're not here to talk about the third quarter. We've just gone into blackout. I'm not here to talk about rumors in the media. Let's kick it off. We have four of our most senior technical people here today. I'd encourage you to use the time wisely. We don't have this group assembled very often for this kind of an event. I think anyone who follows Kinross knows that we take our guidance very seriously. We're very proud of our long-term track record of achievement. Entering 2020, this year, we had met guidance for eight consecutive years.
Despite the ongoing pandemic, we have reiterated that we are on track to meet this year's original guidance, which would make 2020 the ninth consecutive year in a row that we've delivered on our targets. We intend to maintain this record going forward. Our confidence stems from the fact that our company is in very good operational and financial condition. We've invested in our mines to make them as safe and productive as possible. We've supported them with brownfields exploration programs to not only optimize but extend mine life. As a result, we have a portfolio of operations with long lives and strong upside potential, and particularly at higher commodity prices. This morning, we will provide additional detail on the multi-year guidance we spoke about in September.
Paul Tomory and his team will provide a technical briefing that will review, asset by asset, our plan to increase production by 20% by 2023, or said another way, increase production by approximately 500,000 ounces over the next three years. There are three things driving this production increase in the near term, and these same three things put us in an excellent position for the longer term. First, we are realizing the benefits of our three-year capital reinvestment program, which has upgraded our operations and created a platform for further growth. By platform, what we mean is we've invested. We have infrastructure as a result of those capital investments that will help enable additional opportunities. We'll cover that in a bit more detail. Second, the culture of CI is ingrained here, and our continuous improvement programs have allowed us to reduce costs, improve productivity, and also extend mine life.
One of the best examples of this is Paracatu, where you'll have noted over the last couple of years, our drive towards productivity improvement has helped turn this asset into a Tier 1 gold mine, where we've increased production without shortening mine life. I guess the third contributor, of course, is our exploration results, where we've had great success this year, you'll hear more about. We've increased mine life at a number of sites, and in particular at our underground mines, Kupol and Chirano, where we anticipate extending production through to at least 2025 as we sit here today. In addition, this morning, we will also share some of our expectations for production beyond 2023. Part of our intention with today's session is to demonstrate that we have adequate plans and opportunities in our portfolio to carry production through the rest of the decade.
We will offer an overview based on what we know today of our current reserves and resources and the potential new projects and additional organic opportunities that are expected to help us produce an average of approximately 2.5 million ounces annually for the next 10 years. I will, however, caution that the further out we look, the less definitive we can be. Said another way, we can see resources and grades, but in some cases, we haven't completed the necessary technical or permitting work that will be required. As you will see, we have attractive projects in all our regions. We will also touch on several more opportunities that we will continue to study that could further extend the production profile over the coming years.
We have a strong track record of success with mine life extensions, and our large estimated 30-million-ish ounce measured and indicated mineral resource gives us comfort that we can continue. I'm very pleased with where the company is today, and I'm very appreciative of the hard work from our dedicated teams from around the world to help get us where we are today. I'm also very excited about where we're headed. With that opening, I'll now turn the session over to Paul.
All right. Thanks very much, Paul. Just to orient you what we're going to be doing here, we've got about 35, 40 slides that we're going to be going through, stepping through asset by asset. We're going to reserve Q&A for the end, so save your questions up as we go along. I'll be calling out slide numbers. In a couple of spaces, I may be flipping back and forth between slides. A few context setting points here. I'm looking at slide eight, flipping back and forth between seven and eight. I want to reiterate three very important themes for the call today. Number one is the difference between guidance and outlook. Paul talked about it, but the three-year guidance we put out is essentially budget level guidance, where it's the highest level of confidence.
We have detailed models built up in our forecasting tools, Excel and XERAS, that support that. The 10-year outlook is the collection of our projects and study at various stages, from scoping through pre-feasibility to feasibility. Slide eight illustrates that universe of opportunities that underpin our confidence in putting out an outlook at 2.5 average over that time period. There's going to be ups and downs at a 2.5 average. What we're going to be doing over the next months and years and quarters is working to allocate capital in a priority fashion that works in the context of the overall portfolio, that creates a production profile that is manageable with a capital profile that's manageable, and with a little bit of luck and good hard work, we would look to smooth out and augment that profile.
The second thing, and Paul touched on this is going to be a very important theme that runs through the entire presentation today, are those three drivers of growth that Paul outlined. Leveraging CapEx that's already in place, exploration strategy, and CI. I'll be touching on all three of those regularly through this presentation, and we'll be providing lots of illustrations. Here on slide eight, the way to look at this, very roughly speaking, I'm going to make some generalizations. It may not be 100% specific with certain sites, but I'm going to generalize just to orient you to the way we're looking at this. The base case production is generally speaking what's in the market already. It's generally well-known. These are things that are supported either by detailed press releases or NI 43-101 technical reports. I would call these generally well understood and expected by the market.
The things in the middle category, expected growth projects, are things that we've touched on lightly. For example, in the case of Chulbatkan, we've got some high-level numbers out there that accompanied the acquisition. We've just acquired the Peak project in Alaska, again, similar high-level numbers. In general, this middle area is not perhaps quite as well understood by market participants, but there are early inclinations of what they may look like. Over on the right are things that are very much in our hopper. These are, for the large part, ounces that are contained in our $1,400 resource. There are some exploration opportunities that aren't in a resource, but these are, in general, less well understood or understood to varying degrees of detail by the market.
We want to spend a lot of time today on some of these additional pipeline opportunities that though they are currently in our $1,400 resource, underpinned by the three drivers of growth that Paul outlined, we believe that a good number of these could come into a $1,200 economic framework. That's what will underpin our work over the coming quarters and years, is to make these work. I'll draw your attention to the footnotes there. What is base case production? I'll just read these off to you. These are projects and operations in execution at least a PFS study or higher. For the most part, these are already in reserves or anticipated to be in reserves by the end of this year.
Expected growth projects implies projects and operations ranging from scoping to FS and level of confidence and everything in the additional pipeline are really spanning the range from exploration targets to scoping, to in some cases, PFS level of study in that category. The key takeaway here is that we have a very large array of pipeline opportunities in our resources and we're very excited to be advancing these. And as we have over the last four or five years, we will continue to advance these in a disciplined fashion, adhering to our strong principles of operating and technical excellence, and in general, taking the same conservative Kinross approach to advancing these. A final point I'll make here is that we continue to do our long-term plans at $1,200. Our reserves are calculated at $1,200, and they will be calculated at $1,200 with our current year-end.
We have no immediate plans to change our reserve price, obviously, in the context of the current gold price environment, if there are opportunities that are perhaps marginal at $1,200 and are low capital, low risk, we would consider them in this environment. However, we're not close to green-lighting any major capital investment that requires a gold price higher than $1,200. I think that's an important point to reiterate, in the context of what we're talking about today. Okay. Slide nine, overview of the agenda, just the roadmap of the assets we're going to be talking through. We'll get right into it here. Slide 10, this is the guidance, the three-year guidance. What are the key drivers of increased production, cumulative production in the first three years? We thought it would be important to highlight where these are coming from.
The bar chart there on the right, waterfalls the gap between what would be a two and a half million production profile over the next three years to what we have guided. As you can see, in order, the biggest drivers are Chirano, Fort Knox, Paracatu, Kupol, and then Bald Mountain. Chirano and Kupol, those are largely the result of exploration success, but also, as we'll keep talking about today, good continuous improvements to drive down costs, as well as strong engineering and optimizing our mine plans. Fort Knox, the way to look at that is it's largely a pull forward, a re-optimization of the Gil Satellite mine plan, but also a greatly improved operation strategy on how we're using the mill and the tailings.
I think I'm going to spend some time talking about that because that's a pretty big change from what we've been talking about in the past, and this is a strong positive change in the way we operate Fort Knox. At Paracatu, that's also a mine plan acceleration, and in Bald Mountain, it's a re-sequencing of the north and south areas, in that timeframe. Those are the key drivers for the guidance increase over the next three years. Let's get into Russia. The thing that jumps off the page here is that we're now confident to say that we will have continuous production in Russia uninterrupted, and this wasn't always the case. I mean, at Kupol, we have had a strong track record of adding reserves through exploration.
As recently as a year ago, we were potentially contemplating a gap in production between the end of Kupol and the startup of Chuvaayka. That is now no longer the case. We now have continuous production into that overlap period in 2025, we are very optimistic, and John and Richard will talk about this in a moment, we're very optimistic about the continued prospects for exploration in Russia. You can see the base case production profile there. As we've been using throughout this deck, we then show the growth opportunities as well as the additional pipelines that could come in to support this production plan here. Let's get into Kupol. I'm on slide 12 right now, the chart is illustrative.
We've put on here the end of mine life. That's what I want to point out first is back in 2008, the mine would've been long done by now, based on the reserves known at the time. With the acquisition of Dvoinoye, you can see with that first step up in the mine life, took it out to call it 2019 and stayed at 2019 for a number of years as we optimized the operation, as we really improved our ability to operate in Russia and stabilize operating performance, really. Starting in 2014, 2015, and then really into 2016, 2017, we ramped up our exploration focus and have shown a pretty consistent track record of adding new ounces into the reserve at year-end.
Given the large magnitude of Kupol production back, say, four or five years ago, up above half a million ounces a year, it was difficult to replace that level of production. We still had a net declining reserve life there when you factor in the high production. However, as Kupol has adjusted down to being a half a million ounce producer, including feed from Dvoinoye, it has become easier to replace that production. Certainly this year, we anticipate at Kupol only having better than a replacement year. In other words, fully offsetting and then some the depletion this year at Kupol. That chart shows how the mine life has been extended year-over-year, largely as a result of exploration success.
I should note that Dvoinoye, the mine is now moving into suspension, so we are putting the mine into a care and maintenance scenario in the near term, looking to suspend it. Dvoinoye will continue providing stockpile ounces into the Kupol mill for three years. In this three-year guidance timeframe, there will be production from stockpiles at Dvoinoye through 2021, 2022, 2023. We're looking at roughly 90, 50, 300,000 ounces in each of those three years from the stockpiles at Dvoinoye. I should also touch on Kupol's very significant focus on innovation and CI. Sometimes at high grade operations at Kupol, you forget that CI is just as important as it is at the bigger, lower grade open pits. I want to touch on a couple examples here that perhaps we haven't talked about as much.
A couple years ago, we invested in a dry stack tailings project at Kupol, which enabled an increase in the tailings capacity at Kupol, which at the time we didn't have the reserves to fully support that dry stack, but we were very confident that we would add them, and of course, it has played out that way. That dry stack is really helping us now in terms of continued mine life investment. We've invested in things like dry stack. We've upgraded the road. We of course have a permanent road between Dvoinoye and Kupol. Our supply chain strategy into Kupol has also been a focus of very significant continuous improvement, optimizing our logistics, our procurement, our management of working capital supplies and stocks at site. All these things contribute to a more effective cost structure that drives down the cut-off grade for bringing ounces into the economic profile.
In terms of CI in the operations, very significant investments in upgrading the way we mine. We're focused more on narrower veins right now, I'll talk a little bit about that in a moment. Just general cost control. Of course, the ruble being where it is, has also helped. Let's move to slide 13. This is an illustration of the Kupol ore body. It remains open along strike. We have significant runway and room to grow the inferred pipeline as we advance things from exploration potential to inferred, then onward to indicated and reserved. That has been the conveyor belt of pipeline development at Kupol for a number of years right now. As I mentioned, we have been transitioning the mine to narrower vein mining. This has been critical to the enablement of further life of mine extensions.
As we get into mining veins that are narrower than had been historically the case at Kupol, we find that there's still very high grades in those narrow veins. Richard will talk about that. Currently we're getting about 5% of our ounce production from narrow veins, but that will ramp up to close to 30% in the next three, four years. Potentially more than 30% of ounces coming from narrower veins out beyond 2024. Lastly, CI efforts have been successfully, very successfully focused on dilution control so that we can maintain the feed grade as we get into those narrower veins. Also areas like ventilation optimization. We've invested a lot of effort into optimizing our ventilation to allow access to some of these more distal parts of the ore body as we get into these newly opened up zones with exploration.
We're getting deeper and further away from our portals. On slide 14, I'm going to hand over to Richard Adofo. Richard is VP of Global Greenfields Exploration and he'll be making comments today on our Russian and African sites. Richard, over to you on the numerous opportunities there.
Thanks, Paul. At Kupol, what we've done over the years, within the last three to four years, is that we've done a bit of a more systematic drilling underground and surface, because of the reinterpretation of the ore body. We align our drilling in such a way that we'll be able to pick these ones. At the very north of Kupol, in 2016, we picked up a down throw of the Kupol ore body, and based on that down throw, we decided to explore from the known to unknown, and it has led us into that expansion to the north. Specifically, within the last year, we've realized that there's a bit of a flexure in the mineralization to the west, and that is the zone that we are calling Zone 42.
Because of the narrowness of the ore body, we need to be very close to it to be able to drill and get it right. In the same way to the south, we have also, due to reinterpretation, come to realize that the original Kupol trend mineralization is also strained a little bit. For the next few years, we are going to drill this area between the south of Kupol to the known Graben. Previously, we thought that at the end of the Graben, that was the end of the mineralization, but reinterpretation is telling us that we still have enough space to drill. At the depth portions of Kupol, we continue to pick mineralization with depth, which is also quite significant for us. On the eastern end of the Kupol license is Moroshka.
Moroshka, initially we thought it was a simple straight ore body, but reinterpretation has shown us other splays of Moroshka, which we also will continue to explore. From Moroshka, we go to Providence, which is also another area that is going to be explored. We have given ourselves, or we've managed to get quite a significant amount of years ahead of us to continue to drill, and we will continue to do that. When we go to the next slide, we look at the regional perspective of Kupol. At the center of the circle is the Kupol license that is shown red. What we've done is that over the last few years, we've done an estimate engineering to show that any material that is 130 kilometers radius from the Kupol mine, we will be able to track it down to Kupol.
That is the focus and exploration, because we have a long way from the mine, we can now go outside and search for the next Kupol, and basically that is the plan. Fortunately, we have also recently acquired the Kayenmyvaam license, which is quite a big one, on the eastern end of the circle. We've realized that it's also got quite significant amount of epithermal type veins, which we will be exploring. The initial review is that some of these veins are even more longer than the Kupol veins. In the coming years, we will find a lot more time to explore within these areas. Also the other small target areas that we have.
I think all the licenses that we have ordered, finds here are licenses that we own. We are continuing exploring within these areas, for any potential Kupol or bigger than Kupol deposit within the area.
Thanks very much, Richard. Just to touch on a point that Richard mentioned there, this Kiamlyvan property, we actually closed that acquisition this morning, and we're very excited to get going on exploration there. This Kupol synergy project, the circle that Richard talked about, what we're looking for is roughly four-gram type material in that radius, four gram or better. What we've learned is that with our experience at Dvoinoye, the cost of trucking in that radius, depending on the terrain, is between one and two grams. The cost of trucking to Kupol is one to two grams. That is also, by the way, the strategy we used in this Peak Gold acquisition in Alaska, looking at economic radii around what is in effect a hungry mill. I'll talk about that when we get to Fort Knox.
That mill has capacity with our renewed focus on operating strategy in that mill. We've opened up a very large radius of potential opportunity at Fort Knox. We're treating Fort Knox and Kupol very similarly in that way, in that we're the only real mill of any size in the area, and it makes good economic sense to look at things further afield, as long as the grade is there. Let's move on now on to slide 16 and Chulbatkan. The numbers on the page are the scoping study estimates, which are essentially unchanged from what we've been signaling now since the acquisition. Just to provide an update on what's been happening at Chulbatkan. We've had a successful drill campaign this year, notwithstanding COVID. It got a little bit delayed, but we were able to catch up on the program.
We've drilled, roughly speaking, 50,000 meters thus far in the year. On the engineering side, we have advanced engineering on a number of fronts, logistics, power supply, power generation. We've been looking at the schedule. We've delivered an internal project schedule that incorporates permitting studies, engineering, operations, and early works as they would relate to the project. Another thing I would like to start introducing here is this word Udinsk. Chulbatkan is what we refer to as the broader land package. We have the large principal license, and I'm also happy to say we've recently acquired adjoining licenses as well. Udinsk is the pioneer pit. It's the first pit that we're going to be developing at Chulbatkan, or we expect to develop. The numbers that we've got on the page here refer specifically to that Udinsk pit.
I'm going to hand it back here to Richard to talk about other potential targets and exciting opportunities we see in exploration in the broader land package. Slide 17.
During the summer, we did do a geophysics and geochemical, more or less a reconnaissance exploration targeting program, where we ran an IP over the Udinsk property along strike. Also we did quite a lot of soil sampling. On the figure is the soil sampling, the gold anomalies that is shown. What we've realized is that we've come up based on the multi-element testing of the geochemistry, and then also in some areas of the geophysics, we've identified some anomalies or targets that even have bigger or higher geologic signatures than Udinsk. These areas we will continue to follow that. The good thing is that we have interpreted that along strike the Udinsk, both to the north and to the south, we've interpreted anomalies that goes into the newly acquired surrounding property.
We are encouraged with what we have seen and will continue to explore in the years to come.
Thanks very much, Richard. That concludes our comments on Russia. We're going to be moving on to Africa right now. Again, slide 18 orients you to the base case and the growth aspects of what we see coming down the pipeline. I'll get right into the detail on Tasiast here on slide 19. I just want to take a step backward here and reflect on what's happened to Tasiast over the last year. Of all Kinross sites, it has been the one most impacted by the COVID-19 pandemic. We haven't had a production interruption, nor do we expect a significant impact to production this year. However, as we've talked about publicly before, we have fallen behind on stripping due primarily to quarantine and camp impact.
Because we've been quarantining people, in effect, we've had a reduction in the number of people on site and have had to curtail stripping. I'm happy to report that we've recently reduced quarantining requirements dramatically. Camp space has opened back up and the mining rate is now very close, not quite 100%, but well over 90% of where we expect it to be, so that we're getting back on track. The net result is we won't be able to make up that stripping shortfall, and in other words, there will be deferral of production, as you see on the slide here on the bottom right there. There's about 100,000 ounces that will be deferred from 2021-2022, as well as capital, some capital that will have been unspent this year in both stripping and the 21/24k project that will be deferred into subsequent years.
The project, notwithstanding the deferral of some CapEx, remains on time and on budget. You might ask, well, how can we say we've had some deferred CapEx and it's still on time? The CapEx has been deferred in areas that weren't on the critical path, most notably the power plant. The single largest scope of work on the project is the power plant, and we took a three to four month delay on that. I'm happy to report that we are now ramping up the EPC contractor on power plant construction as we speak. Otherwise, the project's doing well. Mechanical and civil works are well advanced. We're now 15% in construction or 45% overall, and like I said, we remain on time and budget. Going to the next slide. Most of you are familiar with the overall Tasiast land package, but I'll provide a couple of reminders right now.
Over on the right, the upper chart, you can see right in the middle, the current mining area, the southern portion of that current mining area is the West Branch. That is where all the current ore feed is coming from. The northern part of the mining area is the historic pit mount pits, which we intend to go back into down the road. There's still a reserve there. On the principal Tasiast permit, which is known as Algytra, there are other targets, Fennec, C67, C68, which we are currently assessing, with further drilling and study. Richard will now talk about those three, Fennec, 67, 68, as well as mineralization at depth in West Branch.
Okay, yeah, it is the same deposit and the same geologic understanding that we are going to imply on. What we've seen within this area is the flatness of the deposit, which is quite good for us. We will continue to explore this further.
Conceptually, what we're looking at for Tasiast Sud is picking up where we left off a year and a half ago, where we're going to reengage on a study to determine the potential for a dump leach operation at Tasiast Sud. As Richard mentioned, Tamaya has a sufficient quantity of high-grade CIL ore that it would warrant trucking up to the big Tasiast mill. Parallel to that, we are looking at the potential for almost a standalone operation for dump leach potential down there. That concludes comments for Tasiast. Let's move on to Chirano on slide 22. Like Kupol, this has been a very encouraging and important exploration success story. It's enabled a three-year mine life extension, and in this three-year extension we'll be mining from a number of different deposits, principally underground, but also some open pit.
Like Kupol and Fort Knox, this is a hungry mill. We're doing 10,000 tons a day, so there is capacity to feed this mill, and that is one of our operating strategies for Chirano. As I've noted on at least a couple of quarterly calls, Chirano is transitioning to a slightly lower production in the range of, let's say, 150 to 160, 170 over this time period at a slightly higher unit cost. It's still a reliable cash flow generator where we continue to be optimistic about the future there. Richard can touch on that in a second. As I mentioned at the outset in my opening comments, Chirano is the biggest contributor to the three-year increase in production guidance, principally because there are now three years of production that weren't there before.
Like other assets, Chirano is one where we have focused a lot on cost control and productivity improvement. We are mining more headings than we were in the past, and a big focus has been on optimizing the mine plan, the mine profile, and how we dispatch equipment and miners. We're happy to say that, like at Kupol, hand in hand with the exploration success, has been a successful focus on cost reduction and productivity. The biggest contributor at Chirano to the mine life extension is a deposit that we call Obra, and Richard, could you please give some more detail on this one?
Thanks, Paul. At Obra, between 2017 and 2020, we have been doing a little bit of surface drilling, trying to extend high grade that was picked around 2014, depth drilling. Over the years, we have continuously achieved results, and as you can see from the slide, what it was in 2017 and what it is now at the end of 2020. That is quite a big amount of material that is coming into the Chirano's life of mine expansion. We will continue to extend and test the down plunge of the mineralization. On the section on your right, I must say that the last intersection of the last drill hole there is currently not in our plan because it is classified as instead, and it shows that that mineralization continue to extend, and we will continue to explore the depth extensions of the Obra.
Obra is actually quite wide, tunnel-like type deposit. You have an average width of 30 meters and a grade is around 2.5 grams. It's got the bulk of the material that can be mined at a profit. Turning on to the next slide where we have the entire Chirano deposit. From Akwaaba all the way to what we are calling Mamnao is approximately a 78-kilometer strike. All the round dotted outlines are the key areas that currently have been added onto our life of mine. Anything below that is the potential areas that we are drilling. At Akwaaba, in the early years, we had a hanging wall split at upper portion, but it was not consistent. As we explore at depth, we realized that the hanging wall is becoming as consistent as the main zone.
That has given us another advantage, and we will continue to explore it. At Suraw. Suraw has also been one of the areas that have been dormant a bit, but we have currently reopened it up and we will continue to explore the depth extensions of Suraw. As I said, we still believe that Obra will extend, especially to the north. Also we have seen a little bit more of the open pit at Mamnao, where originally there is a series of working splits that we are currently exploring as potential open pit for the future. Yes, we are encouraged by what we've seen and what is going on at Chirano.
Thanks again, Richard. That concludes our comments for Africa, and we'll be moving on to the Americas portfolio right now. The Americas portfolio, other than Kettle River-Buckhorn, large open pit mines, and referring back to Paul's opening comments on leveraging CapEx, each of these big open pits has benefited, in this case, less from exploration, but much more so from a pretty intense focus on optimization, both in the cost of productivity structure, but also in ore body understanding, where we understand these ore bodies better. We have more robust resource models, and we're able to tailor mine plans much more effectively to anticipated changes in ore characteristics. In addition, Phase W Vantage Complex at Bald, the Gil Satellite Project, and the overall asset optimization at Paracatu have entailed capital investments that were predicated on what is in effect the first phase.
We justify those investments with robust IRRs, strong paybacks on a first phase of a given pushback. What we are now looking at is, given that we have that infrastructure in place, given that we've made that capital investment, what further potential pushbacks, satellites are enabled by both an optimized cost structure but also a more effective set of capital equipment at site? I'll talk about a number of these examples. Let's start with Paracatu. Just everybody knows this, but it is one of the world's largest gold mines. It is expected to average 600,000 ounces a year for the next three years. It is a tier 1 asset by any definition, and we have been very happy with its performance. On top of its own operating performance, we've benefited from a very strong tailwind from the FX impact.
We continue to plan Brazil's mine plan at 1,200 and also a pretty conservative rail. We're using either 3.5 or 3.75, which is quite far off the current spot price. Paracatu, just to remind what we've been doing there for the last several years, we carried out what was in effect an internal feasibility study, something we call the Asset Optimization Project, which was very heavily focused on developing a better understanding of the ore body, its metallurgical, its geologic, its geochemical characteristics, and tailoring the feeding of the mill, the blending of the ores to optimize recovery and production. We've also implemented a world-class grade control program so that we always have drilled inventory at the grade control level in front of us, to increase reliability and our confidence in month-to-month, quarter-to-quarter, and year-to-year mine plans.
As a result of this higher confidence, we've invested in fleet at Paracatu recently, and that has allowed us to mine more principally into the western portion of the pit where we have higher grades. It's somewhat comical, at Paracatu, a high grade is 0.44 compared to, say, 0.38. On a very high throughput operation as like Paracatu, that makes a big difference. We've pulled forward production and we've pulled forward significant cash flow at this asset. We've done so with the confidence that we're not impacting the long term, we're going to talk about this in a moment here. We do believe that there is strong potential to extend mine life at Paracatu, something that we haven't talked a lot about in recent years, we've been advancing engineering studies. I should also touch on the impact of COVID at Paracatu.
After Tasiast, probably the second most impacted asset. We haven't had any particular impacts to production, but we've had, at times, numerous people off-site, and we've been able to manage through it. But like at Tasiast, I'm happy to say that the worst is behind us. We're now coming out of the COVID impacted period. I'm going to hand it over to Scott Hicks here, he's Vice President of Mine Planning and Technical Evaluations, to talk about some engineering we've been doing at the northwest part of the main deposit.
Thanks, Paul. We wanted to highlight in the graph on slide 27 that at Paracatu, you can see the outstanding continuity of what Paul alluded to, this relatively high-grade ore from this operation. As he mentioned, we are currently studying pushback optimization and working on tailings deposition plans to accommodate what we are illustrating as Northwest Phase 1 on this site plan. This chart has illustrative resource shell gold prices at 13 and $1,400. However, as we said, through asset optimization and as Paul mentioned through today's presentation, we've seen significant operational efficiency gains and together with some required pit engineering, we'd love to see at least some portion of the 4 million indicated resource ounces come into our $1,200 reserve estimate in the not too distant future. The strip ratio to access this ore remains very low.
It ranges from less than half at the northern extent of what's labeled Phase 1B to less than two at the southwestern extent. As Paul mentioned, we've recently invested in additional mining fleet and hope that some acceleration of mining in this western portion of the pit might allow us to continue to increase our production through mine plan optimization and stockpile optimization as well. Thanks, Paul.
All right, Scott, let's move on to Fort Knox here. Fort Knox, have to admit, it's had a challenging couple of years here. We've had some pretty bad luck with rain and geotechnical issues in the pits. Record rainfall, but happy to say the last couple of quarters of Fort Knox have been very strong. We're optimistic about its near-term operating performance, and we've also done what we call some technical resets at the site over the last, say, year. Now let me talk a little bit about each of those. We've invested very heavily in dewatering, so we're very rapidly dewatering the current tailings storage facility, and that's freeing up potentially significant amounts of tailings capacity, and we're also permitted for tailings in the pit.
What we had previously thought was a limitation of Fort Knox tailings capacity, we are now viewing this asset as having a very substantial capacity for future mill production. Of course, with mill production, we would only feed that material into the mill that makes economic sense, and the preponderance of material coming out of the Gil deposit will be heap leach, but there are mill grades that we will be feeding. The other thing we've done in resetting the operating strategy is this is a mill that can do 14 million tons a year, and we've now put in place a mill operating strategy that allows us to run efficiently down to 4 million tons a year. With this spare capacity in both the mill and the tailings, it made the Peak deal extremely attractive, given its high grade and a relatively low consumption of tailings space.
With this improved outlook on operating strategy at Fort Knox, with the capital invested in the Barnes Creek heap leach pad, we have pulled some fleet forward, and Fort Knox, as a result, is the second biggest contributor to the growth in three-year production. Things are looking good for us right now at Fort Knox, and we're happy with operating performance. Again, on the topic of engineering optimization, I'm going to hand it back to Scott here to talk about some satellite deposits we're considering at Fort Knox.
On slide 29, the Gil Satellite project is currently envisioned to be a series of multiple small, both mill and heap leach grade pits that could contribute nicely to Fort Knox by adding incremental high-margin ounces, starting in late 2021, possibly through early 2024, pending permitting and some further study and engineering. This is a deposit that we looked at for some time, the Sourdough area, that we have been able to optimize into a smaller project with excellent returns. As mentioned, the feasibility study and permitting are underway. We're looking forward to telling you more about this in early 2021. What I can say is, while the capital is modest, this project could scale larger at higher gold prices in the future, utilizing the road and some minor infrastructure that we're looking to build there.
As alluded to earlier, it continues to utilize Fort Knox's milling infrastructure with the intent to operationally bridge to the project that Paul will describe next. This slide provides some detail regarding the Gil Satellite $1,400 resources on the bottom right, and the text provides an illustrative subset of these ounces at our $1,200 planning price that we're currently advancing through our feasibility study.
Great. Thanks, Scott. Let's talk a little bit about Peak, our newest acquisition in the Americas. Like I talked about earlier, there's an economic radius around Fort Knox, given the mill capacity that we have, that makes a good chunk of the state of Alaska very attractive for potential bolt-ons. Unlike at Kupol, where we would be building and maintaining our own roads, in Alaska, we benefit from a good installed base of existing infrastructure. For example, at Peak, which is about 400 km away, the penalty on the grade is 1.3. In other words, the cost of trucking to Fort Knox is 1.3 grams per ton, which means that the delivered grade is still very high compared to Fort Knox in situ grade of nearly 10 times higher.
The plan contemplates crushing at the project and then trucking material to Fort Knox, and in our scoping level estimate, we're contemplating first production in 2024. This is anticipated to give a very substantial lift to production for four or four and a half years, at Fort Knox. We're very excited to advance this, and our first work is going to be working closely with the community in developing a mutually beneficial plan and then getting going on some drilling. At Fort Knox, it's not just the satellites and Peak, but we're also focused on an area known as the Northwest Bulge, which John Sims will talk about. John is our Senior Vice President of Resource Geology and Brownfield Exploration, as well as our company QP.
Thanks, Paul. I think I'd like to just add a little color to the brownfield side. I think a recurring theme that you're going to see through the entire deck is the fact that we've really gone from a generative focus to a MinEx focus, and we've implemented a resource characterization process, which really helped us focus in on orebody characteristics. Then we just chase the mineralization out of the known footprint. You're going to see that recurring theme. Now we've allowed ourselves some runway so we can go back to some of that generative work, and that's going to be the focus going forward in a lot of areas. We're just working through that. I think we got way ahead of the process. It's going very well, as you've seen through many of these slides.
For the northwest bulge, Fort Knox is basically a granitic dome that sits at the crest of an anticlinum within the Fairbanks schist. The northwest bulge is a perfect example of where we're chasing the mineralization structurally controlled out of the pit, and because we've done the work on the ore body characterization piece. We're chasing this now to the northwest along these structures, and the granite dome is coming closer to the surface in many areas, so it's really helped a lot to the strip. The only issue that we might have with some of this is the boundary of the schist, where the grade distributions become fairly erratic. The drilling has to be closer spaced along these edges to try to figure out where those boundaries are. There's these erratic grades.
Within the granite dome itself, the grade distributions are very well behaved. You can see the potential expansion, that $1,400 that we see right now, and this could extend the mine life significantly if we can chase it up further.
All right. Thanks, John.
Yeah.
Okay. That concludes Fort Knox. Let's move over to Nevada with Round Mountain. Round Mountain is a fabulous asset, and we've been thrilled with the performance here, and it continues to give in terms of the opportunity. Geologically, it's a very interesting ore body, and it continues to yield some potential. We are studying two separate pushbacks at Round Mountain. More than any other site, these are enabled by the capital that we've put into the place. With the Phase W project, there's about $200 million of capital put into infrastructure, meaning truck shops, ancillary structures, fleet. We now have a very efficient fleet with electric rope shovels and large trucks. The combination of the new infrastructure as well as the refreshed fleet is now allowing us to look at economic thresholds for things like Phase S and Phase X.
Let me go to slide 33 here, where you see the plan view. Phase S obviously is the south part of the pit there. Our current inventory there is just over a million ounces, about a million ounces of indicated. Phase X, we have close to 1.4 million ounces of indicated. Phase X is, in effect, the second pushback or the next major pushback in Phase W. When we situated the infrastructure for the pushback, both the new leach pad as well as the truck shop and ancillary facilities, we made allowance for that Phase X pushback. However, in terms of meeting an economic threshold, Phase S likely comes first in the plan.
We're currently working on a scoping study that contemplates capital in the $50 million range, and we're planning to submit for environmental approval early part of next year for a potential start of mining, if we get good economics and successful permits, in the start of 2022. This would augment and extend open pit operations until 2029 and mill life into the early 2030s. That's on the basis of Phase S alone. Phase S is something that's currently in the $1,400 resource, but early indications are that we can make it work at $1,200, where our work is not yet done, but we're going to be sharing results with you in the early part of next year. Phase X is deeper, a lot more stripping. It's currently a $1,400 opportunity. This is not one where we'd love to make it work at $1,200. We're not there yet.
What could change the game here is some of what we're seeing at depth. I'm going to ask John to talk about some of what we're seeing there in the depth zones of the Phase W pushback in terms of the grades we're encountering.
Sure. Thanks, Paul. First of all, Round Mountain is an epithermal alkalic low-sulfidation system, and it plunges deep to the northwest where we're seeing this on this cross-section. The grades there can be very high, but they're erratic. We hit some really high grades and then hit mid-grades. What we're seeing, though, is we're seeing a lot of grade in the cover that we never expected. When we modeled the cover, we've been hitting grades in the drilling that we have there, which actually will provide some relief on the strip to go and be able to get to Phase X. We're going to continue that drilling and see what we get there and model that up and see if it helps with the strip to be able to allow us to get to Phase X.
One of the things that gives us some confidence there is that in the Phase W pushback, we didn't model any of those upper zone ounces, but we are encountering them now as we mine down through Phase W. That gives the geologists a perspective to potentially include those in a model in a Phase X. We've also put on here some conceptual underground diagrams. That is not off the table. One of the things we're looking at from an engineering point of view is, what is Phase X? Is it a big pushback with a very significant amount of stripping, or is it a more targeted underground? We don't yet know, but we are advancing studies on both open pit and underground potential for Phase X. Moving on to Bald Mountain.
Bald is a contributor for increased production in the three-year timeframe, that's really as a result of resequencing the mine plan. We will preferentially mine more in the north and less so in the south, push out some of the south reserves to later on. It's really a pretty simple resequencing. Bald Mountain remains very prospective. Slide 36, John will talk about some of what we're seeing in terms of the prospectivity.
Sure. As you can imagine, Bald Mountain's a huge land package. Given the fact that we've closed in on ourselves to do the MinEx, mostly in the north, we really focused on the MinEx around the known pits and grew those resources and put much of that into reserves, and there's still a lot of resources to be converted. The north is intrusion related, and the south is a more Carlin-style mineralization. As you can see, we have the expected mine life extensions to the left in the left box, and then the potential resource extensions to the right. You can see we have a number of targets.
Given the fact that we went to MinEx and we chased a lot of this stuff out of the pits, the known pits, we're probably going to move to a more generative program in the south and actually in the north as well. We'll be doing a lot of things at the same time. We've given ourselves some runway to be able to do those things because in the last three years or so, we've really focused on the MinEx piece. Back to you, Paul.
Yeah, thanks, John. I should also add that Bald Mountain, I'll reiterate, we're still planning at $1,200, but Bald Mountain is an asset where a lot of potential mine life has opened up at the consideration of higher gold prices. We're not moving there yet, but if we were to move then to past the $1,400 down the road, Bald would be a very strong candidate for that. Okay, heading to the finish line here with Chile. Let's move on to La Coipa on slide 37. The project, notwithstanding COVID impacts and some early delays, is moving very well. We've established the access road to the Phase 7 pit. The fleet refurbishment is advancing very well. It's about 40% complete. This is the fleet that we moved over from Maricunga. Early works have been completed on repairing some of the roof structures, the water supply.
The camp and the office are being refurbished right now. A bridge crane and things like that are being replaced. The project is advancing well, and we've been able to make up some of the lost time from the early phases of COVID. You've got the key numbers here. I'm not going to talk about those here, rather let's go to slide 38. As we said in the feasibility study, the life of mine from the Phase 7 pit is relatively short. It's 2022, 2023, 2024, three years of production. However, when we entered into the decision to build La Coipa, to restart it, we did so knowing that we had additional deposits on the property that we would advance engineering and permitting on to potentially bring them into the life of mine. Let me give some anecdotal commentary on these.
The Puren deposit is a joint venture with Codelco. We're a 65% owner, they're a 35% owner. It is already in reserves. You can see there on the table the quantum of reserves there. The discussions with Codelco are going well. This is a $1,200 reserve, if all goes well, we'll be incorporating that into the mine plan. We have two more historic pits, Coipa Norte and Can-Can. Coipa Norte is where we finished mining when we shut La Coipa down a number of years ago. Again, with the investment in the infrastructure, with a strong focus on cost containment in Chile, we're working on a plan that could bring Coipa Norte into the mine plan. Can-Can, there are also some high-grade remnants there that we're assessing.
Catalina is an interesting underground. John, can you give a little bit more detail on what we're looking at at Catalina?
Sure. Catalina is actually a vein-hosted deposit, relatively deep and a lot of strip. I think, the plan there would be to either do a trade-off study for underground or possibly from the Pompeya pit once we've mined down on that. We're just doing that work right now. The grades are high, and actually, it's not closed off. We have some indications of mineralization between Pompeya and Catalina, so which we would also possibly cross an underground drift scenario. There's a lot of that still to be played out to see what we might do at Catalina.
That's analogous to what I just described at Phase W, where if things go well on bringing Puren, Coipa Norte, Can-Can into the mine plan, we have a good amount of time to study, as John said, the trade-off between open pit and underground at Catalina, with the potential to grow it from an exploration perspective. These are the things we're working on at La Coipa, and as time goes by, we'll be sharing more details as we incrementally hope to bring these into the overall mine plan. Lobo-Marte on slide 39. Nothing really new here from a market perspective. We're advancing right now the feasibility study. Things are going well. It's going to take us just over a year to do this study. It's a large project, and I should add that its reserve grade is quite high.
It's an attractive basic project, and our key focus of activities here in the feasibility study is to drive down CapEx and to see if we can optimize our capital expenditures, having learned from a number of our other projects. Lobo-Marte advancing well, and currently we're contemplating first production in 2027. Very last here in the deck, John will talk about an interesting little exploration project we have ongoing in the Kettle River complex.
Sure. Curlew is a structurally hosted, low-sulfidation system. It sits under a large basin, and it sort of hugs up against that basin within an andesitic host rock. Multiple veins. We've been drilling it from surface and swinging some really long holes and trying to be surgical at depth, and it's been really difficult. We've had a lot of success doing that. We just can't get the spacing right. What we've done is we proposed to do a lot of rehabilitation and get back underground and do the drilling from underground. Because we've had a lot of success. An example would be Kupol. We moved from drilling from surface, trying to be surgical, to underground drilling with a lot of success. Same at Chirano. This would be sort of a similar situation.
I think drilling from underground is the best way to go, because the nature of these veins, they're short strike length, short dip length, but there's a lot of them, and you can package them up together for mineability. I think the underground will probably turn up a lot of veins. We just hit a new vein we didn't even know existed a while ago, and there tends to be a lot of these that pop up. It's just putting them together and making the shapes and wrapping a really solid resource and reserve around this. I think the underground drilling is going to be key for this project.
Between the inventories already identified and some scoping level desktop estimates from an engineering perspective, we felt comfortable investing $30 million in the next couple of years in this advanced exploration project. With that concludes our remarks. We stuck to just over an hour, that should make Tom happy. We'll turn it back to Paul here for some concluding remarks.
Thanks, Paul and team, for those comments. Before we get to questions, just wrap up by saying we've consciously worked very hard over the last eight years to invest in our portfolio. What we think we've created is a really strong foundation that'll sustain production going forward. We'll be able to reduce costs, improve our cash flow, and obviously, we've got the balance sheet and the financial strength for flexibility to continue to be opportunistic with our portfolio. We've demonstrated we're great operators globally. We've got a great balance sheet. We've got a peer-leading cash flow. We're very excited about our future. Today, as we said, was meant to give you some visibility into the longer term. I hope that's been accomplished. With that, operator, Ian, maybe we could open up the line to questions.
At this time, if you would like to ask a question over the phone lines, please press star then one on your telephone keypad. We will pause for a moment to compile the Q&A roster. Your first question comes from line of Greg Barnes of TD Securities. Your line is open.
Great. Thank you. Paul Tomory, running through this presentation, it sounds to me like this really is a bridge towards a $1,400 reserve calculation. Is that the way you're thinking about it, assuming the gold price remains strong?
Yeah, Greg, we continue to do our planning at $1,200, and our primary focus is moving what are currently $1,400 resources into a $1,200 reserve. The three enablers are what we talked about, leveraging the CapEx we've invested, our lower cost structure, and adding ounces. The way to look at this is a good chunk of those additional opportunities on that first slide I showed, the things over on the right, we hope to be able to bring a good number of those into reserve at $1,200. For example, Phase S and go out.
Phase W.
Yeah, that's exactly what happened at Phase W. We have a strong track record of taking what was previously a higher priced resource and bringing it into a reserve. Our first order of business is, in fact, to make these work at $1,200. That's a very important point. We're not using this as a signal that we're going to be imminently moving to a $1,400 reserve price. That is not what we're doing. We're certainly not doing that year-end this year. I'm going to go out on a limb and say we're likely not going to do it next year either. We may, here and there, approve small capital that requires perhaps a $1,300 or $1,350 if there's a quick in-year payback. It would be foolish, in fact, not to do those things, especially if there's a lower snow payback.
We certainly are not contemplating significant capital investment that requires anything more than $1,200. I want to be really clear on that.
You wouldn't push Phase X, for example, on that basis.
Yeah, Phase X requires more study. I think it requires more study, more drilling, more engineering. One thing that could happen, we don't know, but if John and Richard and the exploration guys find more high grade there, that could drive the incentive price lower for Phase X, but we don't know that yet, which is why in Round Mountain, we're focused immediately on Phase S, which we see a clearer path to a $1,200 reserve.
Just a second question. On the Kupol regional plan, you mentioned the one to two gram penalty on trucking. I don't believe that there's road infrastructure there. You just did mention you'd have to build roads and maintain them. It sounds like a bit more than a one to two gram penalty for that kind of work that would be required for infrastructure.
Well, we've done it, Dvoinoye. We built and maintain that road, and the penalty there is in that same range. We've looked at other deposits in that region, and we've done assessments. What I have to say on that one is, over the years at Russia, we have become very good at building and maintaining roads in these harsh conditions, and that is our assessment that the penalty is one to two grams in that 120 km radius. That is backed by engineering and audits.
Okay. Good to know. Thank you.
Thanks, Greg.
Again, if you'd like to ask a question, please press star then one on your telephone keypad. Your next question comes from the line of Carey MacRury of Canaccord Genuity. Your line is open.
Please ensure your line is not on mute. Your line is open.
Sorry about that. Paul, I think you mentioned at the beginning, Bald Mountain, in terms of the 10-year plan, you've got the production profile, but keeping CapEx manageable. I'm just wondering, is there a certain capital envelope we should think about, or how do you define manageable?
Yeah, look, maybe I'll lead off and segue to Paul. Carey, we've said in different meetings and discussions around capital, if you look back in the rearview, from a combination of both sustaining and growth, something in the $300 per ounce range is the thumb suck, whether you look historically. I wouldn't expect it would change a lot looking forward. Depending upon what our production profile is, to the extent we want to continue with that production profile, probably a good safe place to start for modeling would be $300 an ounce.
Right. Carey, this is something that kingdoms have arisen and fallen here in Kinross in debating how to guide CapEx. The three-year guidance that we put out, the capital in that guidance supports that three-year plan. We couldn't put capital in that guidance for unapproved projects, for example, like Phase S or Kupol extensions or Chirano overall underground development or whatever.
Peak.
Peak, yeah. We can't put CapEx out there for projects that either haven't really been daylighted from an economics perspective or from an acquisition perspective or from an exploration perspective. What will likely happen, and this would be a good news story, is as we approve incremental adds to the mine life, capital will come up. The envelope that we're working with is exactly what Paul said, is that we feel comfortable saying, in general, that our capital would be roughly $300 an ounce in a given year to maintain a production profile of 2.5 million or higher. That's a very crude rule of thumb on how to look at the next 10 years.
Maybe second question, obviously a lot of potential laybacks. Any detail you can provide on strip ratios, like for example, Phase S or even what does the Tasiast strip ratio look like in the $1,400 pit?
We had a debate. Do we talk about strip ratios and tons and all this detailed modeling? We would prefer to leave those to the individual calls where we provide more detail, say, on Phase S or Phase X. In general, these pushbacks are relatively high strip pushbacks, similar to Phase W. For example, Phase S, the reason I don't want to give a number right now is we have waste dumps on the pit rim at Phase S, and those are waste dumps that were created in the '80s and '90s. In some cases, there's higher grade in those waste dumps than what we're pulling out of the pit. We're still trying to assess whether to model grade in those waste dumps or not.
I'm not going to give you an answer on strip ratio, but rather ask for patience on waiting until we have a specific quarterly call or a dedicated call on some of these individual projects. I make the commitment is that we will take the tried and trusted Kinross approach to making these work at $1,200 with robust returns and our typical conservative approach to project assessment.
Okay, maybe just one more for me. You had the 12,000 phase 1 expansion at Tasiast. I think the mill's running at closer to 17,000. You're on your way to 24,000. I assume the guidance is still based on 24,000. Is there a feeling that the 24,000 is going to be something bigger than 24,000?
I'll hand it over to Yves Breau, our VP of Metallurgy and Engineering. He's got some views on that mill. He'll explain how we get to 24, what the elements are, and how we look at potentially beyond there.
Thanks, Paul. Yeah, basically the 24,000 is what we would say our fair and conservative approach that we've done on the other options that we've looked at. The hardness, look, we know the ore body. We know the hardness. We know the recovery. Right now, we're doing really well on recovery, so we anticipate that we could actually push a bit more the leach circuit. If there's anything missing that we would push over 24,000, we would probably put a pre-crusher in there, but that would be something really easy to add on. Right now, I'd say 24 is probably a fair bet and a bit of conservative on our side.
The reason we actually deliberately model the two-phase ramp-up to 21 and 24 is we want to see where we got to actually with 21, given our experience with 12 going higher. We want to see what the thing can do before over-committing on CapEx. Like Yves said, we're really happy with the performance at mill, both from a recovery and a throughput point of view, and we're looking forward to start to unlock these bottlenecks in increments as we complete phases of the project.
Great. I'll pass it on. Thanks.
Your next question comes from the line of Mike Parkin of National Bank.
Hi, guys. Thanks for taking my question. With Chulbatkan, you've got an initial capital estimate of $500 million. Can we kind of think of that and also a spend of $330 through 2021 to 2023? Given that's an earlier stage project, is that $500 million kind of still being optimized, that $330 could actually be a bit conservative and we might see that come in lower than that?
Well, we're about to launch on a formal PFS. We're going to award the EPCM contract in the coming weeks. That $330 is our current best guess view. Of course, we're going to look to optimize that, but I don't want to get ahead of myself and make commitments either higher or lower there. It's our current best estimate, and I would expect that it'll come in roughly ± that estimate.
Okay.
In there, the big year, of course, is 2023.
Right.
Rest of the balance into 2024.
Okay. With respect to that region, can you just give a bit of commentary around the ease of operating at Chulbatkan, relative to Kupol? Obviously, the climate, just from the picture, you can tell it's dramatically different. Ease of infrastructure, workforce, et cetera. It would seem like it's dramatically better around there than what you're experiencing and have experienced up in Kupol.
Sure. Maybe I'll lead off and, again, segue to Paul. Yeah, look, I think bottom line is we're further south. We're in the tree line, so to speak, to use a Canadian analogy, as opposed to above the tree line. The climate is not quite as harsh. It is remote, but not as remote, and there's certainly more infrastructure in the region, and there's more mining company activity in the region, and there's more skills in the region. It is very much an area that is open to mining and welcoming, and we've had a lot of support since the announcement.
Another way to answer it is it's really a matter of perspective. If you'd only ever mined in Ontario or Nevada, yeah, Khabarovsk would be a pretty hard place to mine. If you're used to Chukotka, it's a pretty easy place to mine. It's a relative comparison. At Kupol, as you guys know, we build and maintain a 400-kilometer winter road down from Pevek. We have a seasonal shipping campaign. It's actually one of the most impressive things that Kinross does, and it just happens in the background every year. At Chulbatkan, the roads aren't that far away, but what's more than that is it's right on the Amur River, on a branch of the Amur River, and it has good barge access.
In terms of other mines operating in the area, Polymetal has its Albazino mine, I was going to say just across the river, very proximal there. There are a lot of mines in the area. The towns and cities in the region are good service hubs for things like rebuilds, fabrication, and mechanical electrical support. Compared to Chukotka, Khabarovsk is a much easier place to operate a mine. I don't want to say it's a slam dunk compared to places that are comparatively easier. We feel very confident with our experience in Russia in servicing and operating very remote installations, that this is something within our wheelhouse.
Okay. That's good. Certainly looks encouraging from a capital budget perspective. Switching over to Alaska, you're kind of implementing the hub and spoke model there. Given that you've got significant mill capacity, are you seeing a lot of opportunity regionally to exploit smaller deposits that don't really work on a standalone basis, and definitely are attractive as what you've done with the Peak project?
Again, I'd say, look, we try to keep track on what's going on around us, wherever we're operating. That's point 1. I guess, is there a whole bunch of these? Look, I think there's definitely potential, and I think the most important part of Peak is we've kind of printed a roadmap for others. This is a great opportunity where, whether it's for environmental reasons or just sheer cost, there's a trade-off study to be done as it relates to building your own infrastructure versus utilizing our fixed infrastructure. I think we've got a reasonable handle on what's out there, and hopefully to the extent there's others, this is a nice roadmap to demonstrate what we can, how we could partner.
The other thing is Alaska has a great network of rivers, that opens up a lot of potential for barging. I mean, this is all conceptual stuff, it does open up a very wide radius of potential in Alaska.
That's good. All right, that's it for me. Thanks very much, guys.
Thanks, Mike.
Your next question comes from the line of Anita Soni of CIBC World Markets. Your line is open.
Hi, good morning, everyone. Just a quick question in terms of Tasiast. I'm just going back to the technical report and trying to understand, I guess, relook at some of the capital numbers. Do I understand that some of the capital, as you mentioned, is going to be pushed into 2021, that didn't happen this year? Is that going to be pushed into 2022 as well?
Yeah, there's between $80 million and $100 million of capital that will be deferred.
After this year into subsequent years. A lot of that is stripping. Next year is going to be a high strip year anyway, it's difficult to make that all up in one year. Yeah, there's about $80 million-$100 million of stripping and project CapEx that is being deferred from 2020 into 2021 and 2022.
All right. Secondly, I'm just trying to go back over what the grade assumptions are going forward. I noticed it's the 560,000 ounces, I guess, on average, and I'm not quite getting there through the 24k ton per day. Could you remind me what the grades come up to help you get that average?
Right. What we had in the technical report, the background of the technical report, which is now, as I said, altered because of the capital deferral. We had early grades of, say, 2.3, 2.7, 2.7 in the near term, then dropping to two. Just to remind what's happening at Tasiast, we have big pushbacks as we get into the heart of West Branch, and at the culmination of each of those pushbacks, we hit very high grades, in some cases three grams, as we get there. That's really what drives the sawtooth and the production profile. What was in the technical report is, and like I said, this has now changed. We had 2.3 grams in 2021 and 2.7, 2.7 in 2022, 2023. The key impact of this stripping deferral is a drop in grade in 2021.
We still have the same tons going through, but we have a significant drop in grade happening. That grade gets pushed out. It doesn't go anywhere, it just gets pushed out in the profile.
Okay. Do we just assume that it basically gets pushed out, like to push down the 2022 number from 2.7 and continues on with the chain reaction effect, I guess, is that's the?
Yeah. Yes, Scott will give you a bit more detail.
Hi, Anita. We're optimizing the mine plan, and the intent at this point is to still catch up on those pushed back four ounces within the three-year guidance window.
Okay
We optimized to try to capture all of that still, and that's one of the reasons why on that mine site by mine site chart, by no means we weren't silent on Tasiast. We had already disclosed that that was a significant production increase. Over the three-year period, we're still comfortable that we'll achieve the ounces as stated in the technical report. We just expect it to be more backend loaded, as Paul's alluding to, in that three-year window.
Anita, I just want to be clear. Grade will be lower in 2021, it will be the same or higher in 2022 and 2023, actually.
Okay.
We're just deferring the point at which we access the high grade portion of what we're calling the West Branch 4 pushback.
Okay. Just finishing off on West Africa there, Chirano, can we just assume, in terms of grade profile, similar for the next three years, I guess? Any sort of fluctuations there?
No, I'd say, Anita, it'll be similar.
Okay.
We are including some open pit production that comes at a slightly lower grade, but as we said, there's capacity in the mill, and so we would continue to process those. They would be economic, certainly, with a bit of a bump in the final year of production as we close out some of the pillars and other underground infrastructure in those mines.
We're looking at ±1.8 for the next number of years, but like Scott said, higher grade in the final year.
Okay, thanks. Other questions for Mike Parkin.
Your next question comes from the line of Josh Wolfson of RBC Capital Markets. Your line is open.
Thanks. First off, as it relates to Chulbatkan, there were some kind of broad stroke numbers that were provided in terms of what the expected minable resource was going to be and production outlook. Given some of the exploration results you've seen so far, but that haven't been reported publicly yet, are you lining up with your expectations originally, or is there a potential upside you could see even for that mine plan so far?
I'll hand over to John or Richard here in a second, but the drill program has really been focused on establishing the resource that we bought and confirming that it's there. Most of those drill meters have not yet been focused on expanding that Udinsk pit. Where the exploration has been focused is identifying parallel structures, potential secondary ore bodies. John or Richard, one of you may want to comment on what we've been focusing on.
Sure. The drilling program so far this year has been on drilling out the known pit, as Paul said. We are just now focusing on the high-grade area that we hit earlier in the year. Because of COVID, we have been unable to complete our structural analysis, which is really key to be able to chase this stuff out of the pit. The equipment's in country, the structural analysis is beginning, and then the high-grade drilling's underway. Once we have that structural analysis to put that together in 3D, surface structural analysis along with the drilling, and we can see where these structures are and how to chase them out of the pit, that's when we'll step out and start drilling to expand the resource. Actually, we've hit some along strike. The strike remains open.
Depth actually remains open, it's just the grades were similar to what we've been hitting. We need to expand that pit and allow it to go a little deeper. There's still a lot of work to be done. The COVID thing hit us a bit on the structural piece, which we expected to have done mid this year, but it didn't happen. People are getting in the country, and we're actually getting the work done. Hopefully Q1 of next year, we should know what that picture looks like.
Just to manage your expectations, the PFS we're going to put out on this asset will be the Udinsk pit. I would guide you to think of these numbers that you see here are going to be largely in line. It might be slightly higher, it might be slightly lower, but the PFS is focused on this current pit. Anything that comes beyond there, if it comes, hopefully it comes, we would look at those as bolt-ons, tack-ons. It wouldn't necessarily change our mind in terms of the scope of construction. I think it's really important to lock down a scope that I believe provides a platform for future expansion and leverage. What we don't want to do is chase a large an ever-increasing ore body, because that's when you lose control of your discipline on your capital plan.
What you should expect is a PFS on this Udinsk pit, roughly in line with what these numbers are here.
Got it. Thank you. On the larger sort of strategy side of things, I did hear the introduction remarks that there wouldn't be much comments on some of the rumors that have been surfacing. Is there any sort of commentary that can be provided on thoughts on M&A in terms of long-term outlook for the company in the context of the new plan?
Sure. Our consistent message on M&A has been, we don't feel under pressure. In fact, we're thrilled with the performance of the company. We've been happy with our relative share price performance. We've had a great story to tell in terms of our operations credibility, our outlook, our pipeline today. On M&A, we've stressed. If I hinted anything for the market, it was we like synergistic asset deals. That's how we referred to Bald and Round. That's how we referred to Chulbatkan, and lo and behold, we just announced an acquisition in the Americas, which is a synergistic asset both times. We've got lots in our pipeline, lots of room to grow and extend, and we look at opportunities from time to time. In the past eight years, those are the three announcements that we've made. That's the discipline within the organization.
I don't see a lot of upside in debating the rumor of the week, and there's rumors every week. That's not helpful to anyone, and it's certainly not helpful internally for our employees. The Americas is arguably four of seven mines right now. It is the largest part of our production. It's an important part of our asset base. We're focused on the portfolio and making it the best we can be, and we don't feel under any pressure as it relates to M&A.
Great. Thank you.
Your next question comes from the line of Tanya Jakusconek of SocGen. Your line is open.
Good morning, everybody. Wanted to come back to just some company-wide as we look at your reserves, Paul, as we come to year-end. I think what I took away from this is that you will see reserves addition at Kupol, Chirano. At Chulbatkan, what should we think? Are we just going to have now just a resource there, or will anything go into reserves? Maybe just the rest of the portfolio, do they look like we'll be replacing? My first question.
Yes, you're correct on Kupol, Chirano. We anticipate a reserve add there. In the case of Chulbatkan, there won't be a reserve added year-end this year. We are going to wait for the completion of that PFS. In terms of the other mines, I would say we continue to work on these optimizations and the reserve adds, barring small moves here and there, the reserve adds will be tied to the announcement of any potential expansion being approved. In the case of Round Mountain, if and when we approve Phase S, there would be associated reserve or reserve growth number.
Okay. Hopefully, we try and replace, I guess is what I read from that. For just this year, additions when you approve things.
Yes, that's right.
Okay. Maybe if I could just move on to maybe, Paul R, just looking at the host countries that you operate in. I think we saw Russia come out, not putting any additional taxation on gold and silver mining. I think you have your Mauritania agreement. Can you talk about just any other place you work and potential governments looking at increased royalties or taxation due to COVID?
Yeah, there's nothing imminent to Mauritania. Clearly, there's an awareness on our part when the entire world's in a situation such as we're in, and our business has continued to operate, notwithstanding the challenges of COVID, and our commodity price has done what it's done, there tends to be a focus on who's doing well and where are revenues. We're aware of that. I call it the tallest poppy syndrome. There's been some noise in Nevada, which hasn't come to anything yet. There's nothing that we feel compelled to highlight at this point where we're overly concerned there's going to be some rewriting of the rules to try to get more from the gold industry.
Maybe not maybe getting more, maybe advancing some of the taxation payments forward. Have you heard anything of that, maybe in Ghana or Brazil?
No, there's been a noise every once in a while around have we got the royalty right, is the mineral policy correct, but no, nothing that's keeping us awake right now.
Just maybe on just following up on the M&A. I know that I think we had talked about last year that you had mentioned a company in the size of 1.5 million to 3 million ounces, you believe to be the critical size needed to keep a technical team and sort of have the attention of the generalist. Do you still see that as being valid?
Yeah. What I said, just to be crystal clear, is I like our size because with our size, we can accommodate some of the inherent features we've built. One of the things you know that I think what we're most proud of here is our internal technical team. It's just a question of size. Smaller companies don't have the capacity to necessarily carry that kind of a team internally, and therefore have to be more reliant on external consultants. We're of a critical mass where we don't have to do that. It probably builds a slight bias to conservatism because we do all of our own studies, we do all of our own project execution, and then we hand off to our partners in operations. When we look at stuff, we look at it as owners, not agents.
That's a big advantage to the critical mass we have today. Obviously, as you get bigger, there's pros and cons. There's bigger, more diversified portfolios, and a portfolio is always better than single asset concentration. There is a point where as you get bigger, the question becomes, is there growth? Is there an ability to replace or maintain? What I was trying to say is the bubble we're in right now, and we've been a 2.5-ish producer for many years, that's a good place for us. We like that space, and working with the portfolio, I'm really impressed with what we've been able to do and to put out now a nice 20% growth over the next three years with that portfolio is again, testament to the strength of a strong internal technical team. I'm still of that opinion.
Okay. Maybe my last question just to ask, in order to keep replacing your reserves and maintaining that two and a half million, I understand it's production, but mainly focusing on the mine life, what do you think you need to spend annually on exploration to do this?
Yeah. I'll turn it over to the guys. The combination there is really around what is the actual opportunity set within the portfolio. Everything here is competition for capital, even in exploration. Historically, we've been in the sort of the 70-ish kind of range, combination of brownfields and greenfields, mostly brownfields. I will say, and we haven't come through our budget process yet, we just finished our life of mine planning, which is what this event is really anchored to, our recent two weeks ago life of mine planning. We're now going into budget cycle, but we are seeing some great opportunities and we are looking to increase our budget. Haven't done that yet, but we're talking about increasing our budget given the opportunity set as we go into 2021 and out years.
Tanya, I think the salient point here is that we will be increasing our exploration budget, but we have good targets at our existing sites on the MinEx and generative site, but we've also acquired some good exploration potential. Peak has exploration potential. This Kiamlyvan thing in Russia we talked about has exploration potential. The Chulbatkan adjoining licenses, which we've recently acquired. We have a lot more ground on which to drill, and it will be accompanied by an increase in spending. We see the target and we're up spending for the sake of spending. We see really good targets and really good prospectivity that supports an increased spending on exploration.
Okay. Thank you.
Thanks, Tanya.
Your next question comes from the line of Carey MacRury of Canaccord Genuity. Your line is open.
Hi, maybe just one more question for me. You mentioned you've got a lot of big open pits. There looks like a lot of future ways to move. Have you guys looked at autonomous vehicles, and is that an opportunity that can come in in the next few years to further lower costs?
We always look at things in our innovation area. One of the challenges of big open pits is we have an established fleet at mines that are older. I think the best place to look at autonomous fleets in big open pits is on greenfields or at yet relatively young mines. I should add, in places where labor replacement doesn't become a government relations issue, because that's a factor as well. Global market, would we look at autonomous fleet? Potentially. I think that's one area where we might look at it. For our big established U.S. and Brazil open pits, I would say we're likely not going to look at autonomous fleet. Chulbatkan, could it happen? Yes, it could. We do make use of autonomous in some places, dozers and drills.
It's not what I'm talking about here, we wouldn't do wholesale switches to autonomous, but we do make use of autonomous technology on a spot basis, say, with individual pieces of equipment.
Got it. Thank you.
Your next question comes from the line of Fahad Tariq of Credit Suisse. Your line is open.
Hi, good morning. Just one from me. On slide eight, you talked a lot about additional pipeline opportunities, and they're really all over the portfolio, so there's plenty of opportunities. As you think about competition for capital, how much does the geography matter versus just the inherent mining potential of these opportunities?
Look, I think as it relates to geography, that bridge has been crossed already to the extent we're there and we've decided we're comfortable operating there. Again, you look at our geographies. Mauritania, we've been operating there successfully now for 10 years. We've produced over 2.5 million ounces. Russia, I make the point, as a public company, we're 27 years old, and we've been in Russia for. We have, by definition, gotten comfortable with geographies. When we look at the opportunity, I would say geography is not our prime consideration. It's really about the return, bang for the buck, the risk/reward scenario that we go through. When we think about our bigger portfolio and in aggregate, where our mines are around the world, we will have thoughts from time to time about a preferred geography over another.
One of the things we've said many times, for example, is we don't have a mine in Canada, and we have a head office in Canada. Would we be open to Canada? Absolutely. If we're going to be open to Canada, we've got to find something that creates value for our shareholders. As you know, M&A is very difficult and easier said than done. That's how we come at it. Hope that's helpful.
Yeah, that's great. Thank you.
There are no further questions over the phone lines at this time. I turn the call back over to the presenters.
Well, thank you, Anne. Thanks everyone today. Hope this was helpful and some great questions, and we look forward to catching up with you all along the way in the coming venues. Thank you for calling in today.
This concludes today's conference call. You may now disconnect.