Polymetal Int PLC POLY Reserves and resources results announcement
Polymetal Int PLC (POLY) - Reserves and resources results announcement
RNS Number : 8532Q
Polymetal International PLC
12 November 2012
Release time IMMEDIATE
Date 12 November
2012
Polymetal International plc
Reserves and resources results announcement for Tsokol, Ozerny, Avlayakan,
Dalniy
Polymetal International plc (LSE: POLY) (together with its subsidiaries,
including JSC "Polymetal" - "Polymetal", the "Company", or the "Group") is
pleased to provide an update on Ore Reserves and Mineral Resources for Tsokol,
Ozerny, Avlayakan, and Dalniy deposits according to JORC Code 2004.
Highlights
· As of July 1, 2012 Ore Reserves at our four deposits (Tsokol, Ozerny,
Avlayakan, Dalniy) were estimated at 4.4 Mt of ore with the average grade of
7.2 g/t of Au Eq^1 containing 1.0 Moz of Au Eq (86% gold, 14% silver). Ore
Reserves were estimated using gold price of $1300/oz and silver price of
$23/oz. This is the first estimate of Ore Reserves for all of these properties
with additions representing 7% of the Group's reserves as of 1 January, 2012.
Tonnage Grade Content
Ore Reserves Kt Au, g/t Ag, g/t AuEqv, g/t Au, Koz Ag, Koz AuEqv,
Koz
Ore Reserves
(proved+ probable)
Tsokol Kubaka 1,150 6.2 11 6.4 228 391 235
Ozerny 800 5.3 34 5.8 135 882 150
Avlayakan 470 19.2 132 21.4 290 1,992 323
Danliy 1,960 3.5 85 4.9 218 5,344 307
Total Reserves 4,380 6.2 61 7.2 871 8,609 1,015
· All of the properties belong to operating processing hubs owned by
Polymetal. Two deposits are already in production (Tsokol, Avlayakan) with the
remaining two (Ozerny, Dalniy) expected to start producing ore and generating
cash flows within the next 18 months.
· Discovery costs of approximately $80/oz of reserves (including original
asset acquisition costs) are very attractive given high grade of the deposits,
the ability to process ore at the existing processing facilities with very
modest further investment, and further significant exploration upside.
· As of July 1, 2012 Mineral Resources (in addition to ore resources) were
estimated at 2.3 Mt with the average grade of 4.8 g/t of Au Eq containing 0.36
Moz of Au Eq (88% gold, 12% silver). Mineral Resources were estimated using
gold price of $1500/oz and silver price of $26/oz.
· Substantial exploration potential identified, particularly at Ozerny and
Tsokol.
"These additions to ore reserves are very important for the Company as they
allow us to extend the life-of-mine of both Khakanja and Omolon by 2 years
while materially improving the grade outlook compared with other remaining
reserves at these operations" said Vitaly Nesis, CEO of Polymetal. "Such
results demonstrate excellent returns on investment in our brownfield
exploration activities and we expect further reserve additions at Khakanja and
Omolon in 2013".
^1 Gold equivalent at 60:1 Ag oz/Au oz conversion ratios
Asset details
· Tsokol Kubaka forms the part of Omolon operations and is located 3 km
away from the Kubaka mill. Open-pit mining at the deposit started in Q1 2012
and is expected to continue till the end of 2016 at the rate of 200 ktpa
followed by 2 years of underground mining at 100 ktpa. All ore will be
processed at the Kubaka mill.
Tsokol is a conventional low-sulfide epithermal deposit with main veins open
along strike (down plunge). Substantial further exploration potential for
narrow-vein selective underground mining exists at the property which will be
assessed in due course as the pit deepens.
· Ozerny is a satellite deposit to Khakanja and located 70 km from the
processing plant and accessible only by winter road. Ore from Ozerny will be
processed at Khakanja in 2013-2016 at the average rate of 200 ktpa.
Ozerny is a large brecciated shear zone on the contact between volcanic and
sedimentary rocks. Mineralisation is open at surface along strike in one
direction with active exploration drilling ongoing (6,192 m drilled, 44
thousand m3 of trenches made in 2012). Excellent potential exists to expand
the size of reserve by both resource conversion and identifying ore body
extensions by step-out drilling.
· Avlayakan is a part of the AK standalone green-field exploration project
with a trial open-pit mine feeding the Khakanja processing plant. AK is
located 740 km from Khakanja with ore transportation limited to summer months
due to seasonal sea navigation. It is expected that open-pit mining will
continue until 2014 followed by underground mining in 2015-2018 enabling
average ore shipment rate of 70 ktpa.
This approach to ore utilisation is expected to change if additional
significant reserves are discovered at AK project enabling the construction of
a stand-alone new operation with on-site processing facility. Active drilling
is ongoing at the AK project (6,760 m drilled in 2012) with the objective of
identifying new high-grade veins. Polymetal expects the development decision
on the AK project to be taken in Q4 2013.
· Dalniy forms the part of Omolon operations and is located 5 km away from
the operating Sopka mine. Sopka is 150 km away from the Kubaka mill with ore
transportation limited to winter road. Pre-stripping at Dalniy is expected to
commence in Q3 2013 with ore mining to start in 2014.
High-grade ore is expected to be trucked to the Kubaka mill in 2015-2017 at
100-150 ktpa while low-grade ore will be processed at the Sopka heap leach
facility to be launched in 2015. The actual tonnage split (internal cut-off
grade) between high-grade and low-grade ore will be determined at the time of
the mining based on then prevailing metal prices and actual operating costs.
Ore Reserves and Mineral Resources^
Tsokol
Tonnage Grade Content
Ore Reserves ^1,2,3,4 Kt Au, g/t Ag, AuEqv, g/t Au, Ag, AuEqv,
g/t Koz Koz Koz
Proved
Open Pit 330 5.6 8 5.8 60 87 61
Underground 70 10.9 23 11.3 25 52 25
Existing Stockpile 20 3.9 5 4.0 2 3 3
Subtotal Proved 420 6.4 11 6.6 87 142 89
Probable
Open Pit 570 4.9 9 5.1 90 167 93
Underground 160 10.1 16 10.4 52 82 53
Subtotal Probable 730 6.0 11 6.2 142 249 146
Proved+Probable
Open Pit 900 5.2 9 5.3 150 255 154
Underground 230 10.3 18 10.6 76 134 79
Existing Stockpile 20 3.9 5 4.0 2 3 3
Total Proved+Probable 1,150 6.2 11 6.4 228 391 235
^
^1 Mill only
^2 As of 01.06.2012
^3 Open Pit at COG AuEqv=1.15g/t
^4 Underground Mining at COG AuEqv=4.9g/t
Ozerny
Tonnage Grade Content
Ore Reserves ^1,2,3,4 Kt Au, g/t Ag, AuEqv, Au, Ag, AuEqv,
g/t g/t Koz Koz Koz
Proved 560 5.4 34 6.0 97 615 108
Probable 240 4.9 35 5.5 38 267 42
Total Proved+Probable 800 5.3 34 5.8 135 882 150
^
^1 Mill only
^2 Open Pit only
^3 As of 01.07.2012
^4 At COG AuEqv=2.7g/t
Avlayakan
Tonnage Grade Content
Ore Reserves ^1,2,3,4 Kt Au, g/t Ag, AuEqv, Au, Ag, Koz AuEqv,
g/t g/t Koz Koz
Proved
Open Pit 30 13.8 107 15.6 13 104 15
Underground - - - - - - -
Existing Stockpile 110 17.7 58 18.7 63 204 66
Subtotal Proved 140 16.9 68 18.0 76 308 81
Probable
Open Pit 70 12.8 63 13.8 29 142 31
Underground 260 22.1 184 25.2 185 1,542 210
Subtotal Probable 330 20.1 159 22.8 213 1,684 241
Proved+Probable
Open Pit 100 13.1 77 14.4 42 246 46
Underground 260 22.1 184 25.2 185 1,542 210
Existing Stockpile 110 17.7 58 18.7 63 204 66
Total Proved+Probable 470 19.2 132 21.4 290 1,992 323
^
^1 Mill only
^2 As of 01.07.2012
^3 Open Pit at COG AuEqv=8.05g/t
^4 Underground Mining at COG AuEqv=9.9g/t
Dalniy
Tonnage Grade Content
Ore Reserves ^1,2,3,4 Kt Au, Ag, AuEqv, g/t Au, Ag, Koz AuEqv,
g/t g/t Koz Koz
Proved
Heap Leach 1,630 2.5 54 3.4 130 2,831 177
Mill 330 8.3 237 12.2 88 2,513 130
Subtotal Proved 1,960 3.5 85 4.9 218 5,344 307
Probable
Heap Leach - - - - - - -
Mill - - - - - - -
Subtotal Probable - - - - - - -
Proved+Probable
Heap Leach 1,630 2.5 54 3.4 130 2,831 177
Mill 330 8.3 237 12.2 88 2,513 130
Total Proved+Probable 1,960 3.5 85 4.9 218 5,344 307
^
^1 Open Pit only
^2 As of 01.06.2012
^3 Mill at COG AuEqv=7.25g/t
^4 Heap Leach at COGAuEqv=1.1g/t
Total Mineral Resources^
Tonnage Grade Content
Mineral Resources ^1 Kt Au, Ag, AuEqv, Au, Ag, AuEqv,
g/t g/t g/t Koz Koz Koz
Measured+Indicated+Inferred
Tsokol Kubaka 510 6.3 11 6.4 103 184 106
Ozerny 960 2.9 17 3.2 90 517 98
Avlayakan 190 13.1 150 15.6 80 916 96
Danliy 630 2.1 43 2.8 42 868 57
Total Mineral Resources 2,290 4.3 34 4.8 315 2,485 356
^
^1 Mineral Resources are presented as additional to Ore Reserves
Tsokol
Tonnage Grade Content
Mineral Resources ^1,2,3,4,5 Kt Au, Ag, AuEqv, Au, Ag, AuEqv,
g/t g/t g/t Koz Koz Koz
Measured
Open Pit 10 5.1 8 5.3 2 3 2
Underground 10 6.6 14 6.9 2 5 2
Subtotal Measured 20 5.9 11 6.1 4 7 4
Indicated 50 3.4 8 3.5 5 12 6
Open Pit 90 5.8 10 5.9 17 30 17
Underground 140 4.9 9 5.1 22 42 23
Subtotal Indicated
Measured+Indicated
Open Pit 60 3.7 8 3.8 7 15 7
Underground 100 5.8 11 6.0 19 35 19
Subtotal Measured+Indicated 160 5.0 10 5.2 26 50 27
Inferred
Open Pit 10 2.1 5 2.2 1 2 1
Underground 340 7.0 12 7.2 76 133 78
Subtotal Inferred 350 6.8 12 7.0 77 134 79
Measured+Indicated+Inferred
Open Pit 70 3.4 7 3.6 8 16 8
Underground 440 6.7 12 6.9 95 168 98
Total 510 6.3 11 6.4 103 184 106
Measured+Indicated+Inferred
^
^1 Mineral Resources are presented as additional to Ore Reserves
^2 Mill only
^3 As of 01.06.2012
^4 Open Pit at COGAuEqv=1.0g/t
^5 Underground Mining at COGAuEqv=3.0g/t
Ozerny
Tonnage Grade Content
Mineral Resources ^1,2,3,4,5 Kt Au, Ag, AuEqv, Au, Ag, AuEqv,
g/t g/t g/t Koz Koz Koz
Measured 220 2.5 26 2.9 18 187 21
Indicated 490 2.9 13 3.2 46 206 50
Measured+Indicated 710 2.8 17 3.1 64 392 70
Inferred 250 3.2 16 3.5 26 125 28
Total 960 2.9 17 3.2 90 517 98
Measured+Indicated+Inferred
^
^1 Mineral Resources are presented as additional to Ore Reserves
^2 Open Pit only
^3 Mill only
^4 As of 01.07.2012
^5 At COGAuEqv=1.32g/t
Avlayakan
Tonnage Grade Content
Mineral Resources ^1,2,3,4,5 Kt Au, Ag, AuEqv, Au, Ag, AuEqv,
g/t g/t g/t Koz Koz Koz
Measured
Open Pit 10 12.1 112 14.0 4 36 4
Underground 10 10.1 157 12.8 3 51 4
Subtotal Measured 20 11.1 135 13.4 7 87 9
Indicated
Open Pit 50 11.3 75 12.6 18 121 20
Underground 50 14.0 113 15.9 23 181 26
Subtotal Indicated 100 12.6 94 14.2 41 302 46
Measured+Indicated
Open Pit 60 11.4 81 12.8 22 157 25
Underground 60 13.4 120 15.4 26 232 30
Subtotal Measured+Indicated 120 12.4 101 14.1 48 389 54
Inferred
Open Pit - - - - - - -
Underground 70 14.4 234 18.3 32 528 41
Subtotal Inferred 70 14.4 234 18.3 32 528 41
Measured+Indicated+Inferred
Open Pit 60 11.4 81 12.8 22 157 25
Underground 130 13.9 182 17.0 58 760 71
Total 190 13.1 150 15.6 80 916 96
Measured+Indicated+Inferred
^
^1 Mineral Resources are presented as additional to Ore Reserves
^2 Mill only
^3 As of 01.07.2012
^4 Open Pit at COGAuEqv=5.85g/t
^5 Underground Mining at COGAuEqv=9.4g/t
Dalniy
Tonnage Grade Content
Mineral Resources ^1,2,3,4,5 Kt Au, Ag, AuEqv, Au, Ag, AuEqv,
g/t g/t g/t Koz Koz Koz
Measured 430 2.0 41 2.7 28 572 38
Indicated 200 2.2 46 3.0 14 295 19
Measured+Indicated 630 2.1 43 2.8 42 868 57
Inferred - - - - - - -
Total 630 2.1 43 2.8 42 868 57
Measured+Indicated+Inferred
^
^1 Mineral Resources are presented as additional to Ore Reserves
^2 Open Pit only
^3 Heap Leach only
^4 As of 01.06.2012
^5 At COGAuEqv=0.5g/t
The previous assessment of Mineral Resources for all 4 deposits was reflected
in the Group's Annual Report 2011 as a part of Ore Reserves and Mineral
Resources update as at January 2012.
This estimate was prepared by employees of JSC Polymetal Management Company
and CJSC Polymetal Engineering, subsidiaries of the Company, led by Valery
Tsyplakov, who assumes overall responsibility for the Mineral Resources and
Ore Reserves Report. Mr Tsyplakov is the Managing Director of CJSC Polymetal
Engineering and has 12 years' experience in gold and silver mining. He is a
Member of the Institute of Materials, Minerals & Mining (MIMMM), London, and a
Competent Person under the JORC Code.
Other Competent Persons employed by the Company are responsible for relevant
research on which the Mineral Resources and Ore Reserves estimate is based.
They include:
· Geology and Mineral Resources - Vladimir Ryabukhin, Advisor to Director
General of JSC Polymetal Management Company, MIMMM, with 38 years' relevant
experience;
· Geology and Mineral Resources - Mikhail Fomkin, Head of Geologic
Modelling, MIMMM, with 26 years' relevant experience;
· Mining and Ore Reserves - Igor Epstein, Head of Mining Process
Department, MIMMM, with 30 years' relevant experience;
· Concentration and Metals - Igor Agapov, Deputy Director of Science and
Technology, MIMMM, with 14 years' relevant experience;
· Environmental Issues - Tatiana Kuleshova, Director for Ecology, MIMMM,
with 21 years' relevant experience.
All Competent Persons have given consent for their material to be included in
the Report, based on the information provided by them and in the form and the
context in which the material is hereby presented.
Enquiries
Media Investor Relations
College Hill +44 20 7457 Polymetal ir@polymetalinternational.com
2020
Leonid Fink Maxim Nazimok
Tony Friend Evgenia Onuschenko +7 812 313 5964 (Russia)
Elena Revenko +44 20 7016 9503 (UK)
Joint Corporate Brokers
Morgan Stanley +44 20 7425 Canaccord Genuity +44 20 7523 8350
8000
Sam McLennan Roger Lambert
Sandip Patodia
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END
MSCBTBFTMBABMFT -0- Nov/12/2012 07:00 GMT
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