March 30, 2011 / 7:12 PM / 8 years ago

UPDATE 1-Kinross Gold to invest $1.1 bln in Ecuador mine

* Says construction could begin in 2012

* Production could start two years later (Adds details, background)

QUITO, March 30 (Reuters) - Canada’s Kinross Gold (K.TO) will invest $1.1 billion in Ecuador’s Fruta del Norte gold project until 2016 and could begin digging an underground mine next year, a company executive said on Wednesday.

Dominic Channer, a vice president of the Toronto-based firm, said gold production could begin at the site in 2014.

Kinross says Fruta del Norte has proven and probable mineral reserves estimated at 6.8 million ounces of gold and 9.1 million ounces of silver, and that it should produce 410,000 gold equivalent ounces on average each year during its life.

Ecuador, which is holding a mining conference in Quito, expects to draw investment worth $7 billion in gold and copper projects over the next seven years, and says five projects will be signed in the next few months. [ID:nN2937519]

The OPEC member has a nascent mining industry. Some larger projects were initially delayed as the government of President Rafael Correa hammered out new regulations for the sector. (Reporting by Santiago Silva. Writing by Frank Jack Daniel and Daniel Wallis; editing by Jim Marshall)

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