REG - Polymetal Int PLC - Reserve and Resource update as at 1 January 2017 <Origin Href="QuoteRef">POLYP.L</Origin> - Part 1

Polymetal International PKAnnouncement

14/03/2017 07:08

RNS Number : 3698Z
Polymetal International PLC
14 March 2017
Release time
IMMEDIATE
Date
14March 2017
Polymetal International plc
Ore Reserves, Mineral Resources and Exploration update as at 1 January 2017
Polymetal International plc (LSE, MOEX: POLY, ADR: AUCOY) (together with its subsidiaries - "Polymetal", the "Company", or the "Group") is pleased to provide an Exploration update for the year ended 31 December 2016, and report its Ore Reserves and Mineral Resources as at 1 January 2017 in accordance with the JORC Code (2012).
2016 HIGHLIGHTS
 Polymetal's Ore Reserves decreased by 5% to 19.8 Moz of gold equivalent (GE) mainly due to mining depletion and a downgrade atVarvara which were partially offset by reserve additions from the new acquisition at Komar, Dolinnoye and an upgrade at Svetloye;
 Mineral Resources (additional to Ore Reserves) increased by 29% to 16.5 Moz of GE, mainly driven by the acquisitions of Kapan and Komar, as well as the initial Mineral Resources estimates at Levoberezhny and Lichkvaz;
 Mineral Resources (inclusive of Ore Reserves) at gold equivalent grew by 5% to 36.4 Moz;
 The average grade in Ore Reserves decreased by 8% to 3.8 g/t GE mainly due to additions from Komar. The average grade for Mineral Resources decreased by 11% to 4.2 g/t GE, mainly as a result of additions from Kapan;
 In 2016, we continued to use conservative gold and silver price assumptions in our reserve and resource estimates, US$1,200/oz and US$16/oz, respectively (2015: US$1,100/oz and US$15/oz);
 Exploration drilling volumes increased by 40% year-on-year to 324km, as the Company expanded its scope of exploration to include newly acquired assets and joint ventures; 
 9 new licences were obtained over the course of 2016, bringing the total number to 86, of which 47 currently involve active exploration activities. 
"In the course of 2016 we significantly strengthened the resource base of our operating mines and successfully advanced our long-term growth strategy." - said Vitaly Nesis, Group CEO of Polymetal, commenting on the results. "In 2017, we plan to focus on converting resource additions into reserves growth. The key elements of this plan involve initial reserve estimates at Nezhda and Kapan as well as material resource-to-reserve conversion at Kapan, Lichkvaz, Omolon and Komar."


Ore Reserves and Mineral Resources summary(1)

1 January 2017
1 January 2016
Change



Ore Reserves (Proved + Probable), gold equivalent Moz
19.8
20.8
-5%
Gold, Moz
17.6
17.7
-1%
Silver, Moz
163.0
207.2
-21%
Copper, Kt
65.4
85.4
-23%




Mineral Resources (Measured + Indicated + Inferred), gold equivalent Moz
16.5
12.8
+29%
Gold, Moz
14.4
11.3
+28%
Silver, Moz
87.5
48.6
+80%
Copper, Kt
206.7
132.0
+57%
1) Mineral Resources are additional to Ore Reserves. Mineral Resources and Ore Reserves of Lead and Zinc are not presented due to the immaterialityand are not included in the calculation of the gold equivalent. PGMMineralResources arepresentedseparatelyandare not included in the calculation of the gold equivalent.
Differences are due to rounding.
FY2017 OUTLOOK
In 2017, Polymetal will continue to invest in exploration with the goal to expand the pace and scope of drilling, as well as prospect evaluation. The key objectives are as follows:
 To achieve resource-to-reserve conversions and resource upgrades at our brownfield projects with particular focus on shorter life-of-mine assets. At Omolon the focus will be on Irbychan and Yolochka; at Voro - on Saum and Tamunier; at Okhotsk - on Levoberezhny, Gyrbykan, and Maimakan-Kundumi; at Dukat - on Primorskoye;
 To initiate a comprehensive exploration campaign at the deeper levels of Dukat with a goal to extend the scope of resource estimates at least 300 meters below current underground workings;
 To produce an initial JORC reserve and resource estimate at Nezhda JV's Zone 1 and continue drilling on smaller, potentially mineralised zones;
 To complete at least 25 km of diamond drilling at the Prognoz silver deposit;
 To publish a JORC-compliant reserve estimate and a combined LOM plan for Kapan and Lichkvaz;
 To complete a step-out drilling campaign at Komar and update the reserve and resource estimates for the deposit;
 To continue step-out and deep-level drilling at Kyzyl.
Ore Reserves and Mineral Resources by metal, 1 January 2017
Ore Reserves
Mineral Resources



Gold
89%
87%
Silver
9%
7%
Copper
2%
6%
Total
100%
100%
Ore Reserves reconciliation, gold equivalent, Moz
Ore Reserves, 01.01.2016
Gold/silver price ratio change1
Depletion
Revaluation 
Initial reserve estimates
Ore Reserves, 01.01.2017
20.8
-0.2
-1.5
-0.3
1.0
19.8
1) Please refer to the Appendix for the gold equivalent conversion ratios and applicable methodology.
Mineral Resources and Ore Reserves as at 1 January 2017(1)

Tonnage
 Grade
Content

Mt
 GE, g/t
GE, Moz
Mineral Resources




Measured
8.0
1.9
0.5
Indicated
34.6
3.4
3.8
Measured + Indicated
42.7
3.1
4.3
Inferred 
78.2
4.9
12.2
Measured + Indicated + Inferred
120.9
4.2
16.5





Ore Reserves 




Proved
61.5
2.6
5.2
Probable
98.9
4.6
14.6
Proved + Probable
160.5
3.8
19.8
1) Mineral Resources and Ore Reserves in accordance with the JORC Code (2012). Mineral Resources are additional to Ore Reserves. Mineral Resources and Ore Reserves of Lead and Zinc are not presented due to the immaterialityand are not included in the calculation of the gold equivalent. PGMMineralResources arepresentedseparatelyandare not included in the calculation of the gold equivalent.
Discrepancies in calculations are due to rounding.


Exploration areas and volumes (mine site exploration excluded) (1)
Drilling, km

2016
2015
Brownfield


Voro
13.7
17.5
North Kaluga
-
5.2
Voro flanks
1.9
3.1
Tamunier
6.2
6.9
Other
5.6
2.3



Varvara
75.8
62.1
Varvara
23.6
32.3
Tarutin
0.9
5.5
Dolinnoye
6.7
24.3
Komar
44.6
-



Dukat hub
51.3
38.2
 Dukat flanks
17.2
19.6
 Lunnoye flanks
13.8
-
 Primorskoye
11.0
5.0
Perevalnoye
-
10.0
Terem
4.7
1.5
Other
4.5
2.1



Albazino
27.9
16.0



Okhotsk hub
28.2
11.9
Khotorchan/Gyrbykan
7.0
2.8
Svetloye
0.6
3.6
Kirankan
1.6
2.3
Maimakan-Kundumi
2.5
-
Levoberezhny
8.3
0.2
Other
8.2
3.0



Omolon hub
32.8
16.3
Olcha
-
0.7
Oroch
1.7
-
Burgali
-
1.6
Yolochka
5.9
4.7
Irbychan
11.6
5.7
Nevenrekan
8.4
-
Other
5.1
3.6



Kyzyl project
10.5
45.6
Bakyrchik
5.7
36.1
 Bolshevik
4.9
9.5
Subtotal
240.1
207.6



Greenfield


Urals
6.2
8.3
Svetlobor (PGM)
0.1
2.4
Urals regional
6.1
5.9



North-West
12.8
-
Karelian PGM (inc. Viksha)
10.0
-
Other
2.9
-



Nezhda
39.4
-
Nezhda
39.4
-



Armenia
25.2
15.8
Lichkvaz
24.0
15.8
 Other
1.2
-
Subtotal
83.6
24.1
Total
323.7
231.7
1) Discrepancies in calculations are due to rounding.


EXPLORATION RESULTS
Dukat hub
 17 km have been drilled at the near flanks of the Dukat property at the Khrustalny, Mglystiy and Smeliy ore zones. Following on from last year's exploration, additional ore bodies have been traced to the north at Khrustalny. In 2017, we plan to carry out prospecting activities at the deeper levels of Dukat to confirm the presence of a second horizon of mineralisation and other targets around the Dukat hub area. 
 At the Primorskoye property (250 km from the Omsukchan concentrator), 11 km of exploration drilling was carried out in ore zones 1 and 3, along with detailed metallurgical and geomechanical studies. A bonanza section with anomalous high grade content was identified (17.9 g/t for gold, 4700 g/t for silver), holding more than 60% of all resources of ore zone 1. Mineral resource estimate comprised 311 Koz GE at 19.6 g/t GE. In 2017, we plan to continue drilling in order to expand the resources and produce a JORC-compliant reserve estimate for the property in 2018. 
Omolon
 An increased reserve estimate of 213 Koz GE at 2.3 g/t GE at Sopka (180 km from Kubaka mill) was a result of revaluation which made feasible the restart of open-pit mining, now scheduled for 2017.
 A resource estimate at the Central, Northern and Eastern zones of the Irbychan deposit (veinlet-disseminatedmineralisation type) has been completed, with the feasibility study being prepared. We plan to issue an initial reserve estimate in 2017 with the goal to start open-pit mining at the property in 2H 2019. 
 At Yolochka (veined and veinlet-disseminatedore bodies of low-sulphide gold-silver formation), as a result of infill drilling (6 km),new rich ore zones were discovered on the western flank. Core drilling will continue in 2017 with an aim to expand the resource base and prepare for the reserveand resource estimate in 2017.
 At Nevenrekan, 8 km of drilling was completed at ore zone 2, as well as zones 1 and 5. In ore zone 1, high-grade ore sections were discovered, which, with further exploration, are expected to increase the resource base of the property. Drilling will continue in 2017 with a goal to upgrade resources into higher categories and prepare for the reserve estimate in 2018.
Okhotsk
 At Maimakan-Kundumi(a new property approx. 30 km from Avlayakan), as a result of 2.5 km of prospecting drilling, 3 ore bodies containing high-grade gold and silver mineralisationwere identified. An initial mineral resource estimate for the property has been prepared and comprises 106 Koz of GE at an average grade of 13.7 g/t GE with further mineral potential estimated at 100-500 Koz of gold at an average grade of 6-15 g/t. In 2017, prospecting and evaluation activities will continue with 13 kmof planned drilling. 
 Polymetal will continue exploration at areas adjacent to the Khakanja plant with the goal to expand its mine life. Further exploration potential is associated with Khotorchan and Gyrbykan (180 km from the Khakanja mill), where new ore intercepts have been identified. The anticipated mineral potential for the properties is estimated at 100-200 Koz of gold at average grades of 10-15 g/t. In 2017, prospecting and evaluation activities are set to continue. 
 At Svetloye, advanced exploration activities yielded an increase in reserves for the second consecutive year, adding 157 Koz of GE through positive mine-to-model reconciliation and additional step-out drilling. 
 Evaluation activities at Levoberezhny (35 km from Svetloye) yielded positive results, confirming its future prospects. An initial mineral resource estimate at the property comprises 378 Koz of GE at 4.2 g/t GE. Further metallurgical testing and exploration activities are set to continue in 2017 with a goal to gain approval on the feasibility study and prepare an ore reserve estimate. 
Albazino
 Exploration drilling at the Farida and Ekaterina 1 & 2 ore zones was mainly focused on the deposit to prepare ore bodies for open-pit mining. The Company continues to work on outlining ore bodies and on upgrading resource categories. In 2017, we will continue exploration works within the license area in order to establish new prospective ore bodies. 
Voro hub
 At the recently acquired Saum property with VMS-style mineralisation, we plan to perform metallurgical studies and near-deposit geophysics in 2017.
 6 km of drilling has been completed at Tamunier, identifying 38 ore intercepts that meet the project targets. The traced mineralisation along strike is between 120 m to 800 m with the thickness varying between 0.5 m - 9.6 m, explored at a depth of 30-320 m. The average grade traced through the ore bodies varies from 1.02 - 23.0 g/t. In 2017, drilling aimed at outlining ore bodies will continue. A reserve estimate is expected in 2017. 
Varvara hub
 At the newly acquired Komar (187 km from Varvara plant), detailed in-fill and step-out exploration drilling (45 km) at the flanks of the deposit have been finished, leading to initial reserve and resource estimate in 2016. As at 1 January 2017 ore reserves and mineral resources comprise 873 Koz of gold at 1.8 g/t and 517 Koz of gold at 2.2 g/t, respectively. Additional prospecting activities aimed at the discovery of new ore bodies and the expansion of the resource base around the property are set to continue in 2017.
 Additional exploration drilling totalling 7 km was conducted at the North-Eastern and Northern areas of the Dolinnoye deposit within the optimised pit outline that was established based on exploration results from 2015. An initial reserve and resource estimate was prepared by CSA Global based on Polymetal's share in the deposit, amounting to 101 Koz of GE at 2.4 g/t GE in reserves and 247 Koz of GE at of 2.5 g/t GE in resources. 
 Exploration activities at Tarutin (150 km from Varvara plant) have been finalised. The feasibility study for the property has been completed and the deposit has now a clear path to production as another component of the hubstrategyatVarvara.
Kapan/Lichkvaz
 At Kapan, a revised JORC-compliant resource estimate was prepared by Polymetal and as at 1 January 2017 mineral resources comprise 1,928 Koz of GE (excludes zinc) at an average GE grade of 4.0 g/t. 
 An initial resource estimate for Lichkvaz (70 km from Kapan plant) prepared by CSA Global Pty Ltd. comprises 582 Koz of GE at 4.2 g/t GE. 24 km of further in-fill and step-out drilling aimed at identifying and delineating ore bodies has been completed in 2016 with a goal to establish an additional resources upgrade of existing resources into a higher category. 
 Polymetal plans to conduct additional drilling in 2017 to produce a JORC-compliant ore reserve estimate and combined life-of-mine plan for Lichkvaz and Kapan in Q3 2017. 
Kyzyl
 At Bakyrchik, drill testing of several targets near the main deposit (Promezhutochny and Gluboky) have yielded positive results. Out of 35 drill holes completed in 2016, 26 have ore intercepts with an average thickness varying from 0.5 m to 6.75 m, and gold content varying between 2.4 g/t to 24.2 g/t. In 2017, step-out drilling of existing ore bodies will continueto prepare the property for mining. 
 At Bolshevik, a satellite deposit to Bakyrchik, we completed drilling and sampling assessments paving the way for the preparation of a feasibility study, which is expected to be translated into an initial resource estimate in 2017. 
PGM's
 The exploration licence for the Viksha project has been successfully converted into a mining licence effective from July 18, 2016. An initial Mineral Resource estimate for the PGM Viksha project in Karelia comprises 9.5Moz of PdEq, making Viksha one of the largest open-pittable PGM resources in the world. The depth of the open-pit is 150 m below surface with an average thickness of 7 m. In 2017, we will proceed with further exploration program. A feasibility study for an ore reserve estimate is planned for Q3 2019. 
 Prospecting drilling activities at Kuolisma property, a new ore licene area, totalled 9 km as a result of which platinum and palladium mineralisation zones were identified. 
Prognoz 
 Polymetal acquired a 5% indirect interest in Prognoz in 2017. It is the largest undeveloped primary silver deposit in Russia, estimated to hold 292 Moz of silver at 586 g/t in JORC mineral resources as estimated by Micon (not included in the statement as of 1 January 2017). Polymetal plans to undertake 25 km of diamond drilling, and complete a technical study resulting in an externally audited JORC-compliant reserves estimate for the property before 31 March 2019. Preparations are already underway for the 2017 drilling campaign. 
Nezhda
 During the year, Polymetal performed an extensive exploration campaign at Nezhda JV obtaining significant additional comfort on the geology and metallurgy of the deposit.
 Diamond drilling totaling 39 km was completed at ore zone 1 of the Nezhda deposit in 2016. 141 ore intercepts have been traced in the southeast part of ore zone 1 with an average thickness of 5.3 m, and average grades from 2.3 g/t to 74.5 g/t for gold and 1.7 g/t to 54.6 g/t for silver. At the northwestern part of ore zone 1, 121 ore intercepts have been identified with an average thickness of 20.9 m, and grades from 1.1 g/t to 18.7 g/t for gold and 1.4 to 49.6 g/t for silver. In 2017 further exploration of ore zone 1 and adjacent areas is planned to expand open-pittable resources.


Ore Reserves as at 1 January 2017(1)

Tonnage
Grade
Content

Kt
Au, g/t
Ag, g/t
Cu, %
GE, g/t
Au, Koz
Ag, Koz
Cu, Kt
GE, Koz
Proved









Standalone Mines









Albazino 
2,660
3.9
-
-
3.9
336
-
-
336
Mayskoye
3,530
6.9
-
-
6.9
783
-
-
783










Dukat hub
7,870



4.3
189
74,565
-
1,091
Dukat 
5,100
0.5
280
-
3.9
89
45,892
-
635
Lunnoye
2,060
1.4
283
-
4.9
90
18,725
-
321
Goltsovoye
260
-
434
-
5.6
-
3,723
-
48
Arylakh
450
0.7
424
-
5.9
10
6,225
-
87










Varvara hub
20,310



1.2
753
-
11.2
807
Varvara (3)
13,470
0.9
-
0.41
1.0
385
-
11.2
438
Komar (4)
2,030
1.1
-
-
1.1
74
-
-
74
Maminskoye (5)
4,810
1.9
-
-
1.9
295
-
-
295










Omolon hub
10,450



2.7
771
12,378
-
911
Birkachan
4,940
1.8
6
-
1.9
289
882
-
299
Sopka Kvartsevaya 
2,780
1.4
64
-
2.1
129
5,696
-
190
Oroch 
810
3.7
163
-
5.9
96
4,198
-
151
Olcha
190
8.0
21
-
8.2
46
124
-
48
Dalneye (8)
1,120
1.9
28
-
2.2
70
1,018
-
78
Tsokol Kubaka
230
6.4
12
-
6.6
46
86
-
47
Burgali (9)
380
7.9
31
-
8.2
95
375
-
98










Voro hub
9,000



1.7
484
863
-
491
Voro 
9,000
1.7
3
-
1.7
484
863
-
491










Okhotsk hub
5,970



3.2
589
3,287
-
617
Svetloye
4,870
2.8
4
-
2.9
446
586
-
447
Avlayakan
230
14.8
122
-
16.2
108
886
-
118
Ozerny (11)
290
1.8
28
-
2.0
17
258
-
19
Khakanja (12)
580
1.0
83
-
1.8
18
1,556
-
34










Development and exploration projects









Veduga (14)
170
2.6
-
-
2.6
14
-
-
14
Kutyn (15)
1,580
3.3
-
-
3.3
169
-
-
169
Total Proved
61,540



2.6
4,089
91,094
11.2
5,221
Probable









Standalone Mines









Albazino
12,280
4.3
-
-
4.3
1,696
-
-
1,696
Mayskoye
2,940
6.9
-
-
6.9
646
-
-
646










Dukat hub
5,680



5.3
140
67,822
-
963
Dukat 
3,980
0.7
394
-
5.4
90
50,384
-
690
Lunnoye
910
1.4
276
-
4.8
42
8,117
-
143
Goltsovoye
200
-
363
-
4.7
-
2,315
-
30
Arylakh
240
1.0
276
-
4.4
8
2,147
-
34

Tonnage
Grade
Content

Kt
Au, g/t
Ag, g/t
Cu, %
GE, g/t
Au, Koz
Ag, Koz
Cu, Kt
GE, Koz
Perevalnoye (2)
350
-
428
-
5.9
-
4,860
-
67










Varvara hub
37,230



1.8
1,928
269
35.4
2,114
Varvara (3)
12,400
1.0
-
0.52
1.3
408
-
24.6
526
Komar (4)
12,970
1.9
-
-
1.9
799
-
-
799
Maminskoye (5)
9,890
1.9
-
-
1.9
618
-
-
618
Tarutin (6)
660
0.1
13
1.62
3.3
2
269
10.8
70
Dolinnoye (7)
1,310
2.4
-
-
2.4
101
-
-
101










Omolon hub
1,950



8.9
529
2,159
-
555
Birkachan
970
9.8
36
-
10.3
305
1,101
-
318
Sopka Kvartsevaya 
120
4.0
137
-
5.8
16
545
-
23
Oroch
10
2.5
178
-
4.8
1
78
-
2
Olcha
230
9.1
22
-
9.4
66
163
-
68
Tsokol Kubaka
460
8.0
9
-
8.1
117
128
-
119
Burgali (9)
160
4.7
28
-
5.0
24
144
-
25










Voro hub
1,840



6.3
267
1,267
18.9
370
Voro 
1,520
4.1
4
-
4.1
197
211
-
199
North Kaluga (10)
320
6.7
101
5.81
16.4
70
1,056
18.9
171










Okhotsk hub
2,590



3.1
256
368
-
258
Svetloye
2,510
2.8
3
-
2.8
227
240
-
228
Avlayakan
80
11.2
50
-
11.8
29
129
-
30










Development and exploration projects









Kyzyl project (Bakyrchik) (13)
29,150
7.7
-
-
7.7
7,254
-
-
7,254
Veduga (14)
3,200
5.2
-
-
5.2
535
-
-
535
Kutyn (15)
2,070
3.3
-
-
3.3
217
-
-
217
Total Probable
98,930



4.6
13,469
71,887
54.3
14,608










Proved + Probable









Standalone Mines









Albazino 
14,940
4.2
-
-
4.2
2,032
-
-
2,032
Mayskoye
6,470
6.9
-
-
6.9
1,429
-
-
1,429










Dukat hub
13,550



4.7
329
142,388
-
2,054
Dukat 
9,080
0.6
330
-
4.5
178
96,276
-
1,325
Lunnoye
2,970
1.4
281
-
4.8
132
26,843
-
464
Goltsovoye
460
-
404
-
5.2
-
6,038
-
77
Arylakh
690
0.8
373
-
5.4
18
8,372
-
122
Perevalnoye (2)
350
-
428
-
5.9
-
4,860
-
67










Varvara hub
57,540



1.6
2,681
269
46.6
2,921
Varvara (3)
25,870
1.0
-
0.48
1.2
792
-
35.8
964
Komar (4)
15,000
1.8
-
-
1.8
873
-
-
873
Maminskoye (5)
14,700
1.9
-
-
1.9
913
-
-
913
Tarutin (6)
660
0.1
13
1.62
3.3
2
269
10.8
70



Tonnage
Grade
Content

Kt
Au, g/t
Ag, g/t
Cu, %
GE, g/t
Au, Koz
Ag, Koz
Cu, Kt
GE, Koz
Dolinnoye (7)
1,310
2.4
-
-
2.4
101
-
-
101










Omolon hub
12,400



3.7
1,300
14,537
-
1,466
Birkachan
5,910
3.1
10
-
3.2
594
1,983
-
617
Sopka Kvartsevaya 
2,900
1.5
67
-
2.3
145
6,242
-
213
Oroch
820
3.7
163
-
5.8
97
4,276
-
154
Olcha
420
8.6
22
-
8.8
113
286
-
116
Dalneye (8)
1,120
1.9
28
-
2.2
70
1,018
-
78
Tsokol Kubaka
690
7.5
10
-
7.6
164
214
-
166
Burgali (9)
540
7.0
30
-
7.2
119
519
-
123










Voro hub
10,840



2.5
751
2,131
18.9
861
Voro 
10,520
2.0
3
-
2.0
681
1,075
-
690
North Kaluga (10)
320
6.7
101
5.81
16.4
70
1,056
18.9
171










Okhotsk hub
8,560



3.2
845
3,655
-
876
Svetloye
7,380
2.8
3
-
2.8
674
826
-
675
Avlayakan
310
13.8
103
-
15.0
137
1,015
-
148
Ozerny (11)
290
1.8
28
-
2.0
17
258
-
19
Khakanja (12)
580
1.0
83
-
1.8
18
1,556
-
34










Development and exploration projects









Kyzyl project (Bakyrchik) (13)
29,150
7.7
-
-
7.7
7,254
-
-
7,254
Veduga (14)
3,370
5.0
-
-
5.0
549
-
-
549
Kutyn (15)
3,650
3.3
-
-
3.3
386
-
-
386
Total Proved + Probable
160,470



3.8
17,558
162,980
65.4
19,829
1) Ore Reserves are reported in accordance with the JORC Code (2012). Discrepancies in calculations are due to rounding.
2) Initial estimate prepared by Polymetal as at 01.01.2016. Price: Ag = US$15/oz, Pb = US$1,700/t. Revised estimate was not performed due to lack of material changes.
3) Cu grade in Ore Reserves only represents average grade of Float feed. Ore Reserves of Float feed: 2.7 Mt Proved and 4.7 Mt Probable.
4) Initial estimate prepared by Polymetal as at 01.07.2016. Price: Au= US$1,100/oz. Revised estimate as at 01.01.2017.
5) Estimate prepared by Polymetal as at 01.01.2014. Price: Au= US$1,300/oz. Revised estimate was not performed due to lack of material changes.
6) Initial estimate prepared by Polymetal as at 01.01.2016. Price: Au= US$1,100/oz, Ag = US$15/oz, Cu = US$5,000/t. Revised estimate was not performed due to lack of material changes. Ore Reserves are presented in accordance with the Company's ownership equal to 75%.
7) Initial estimate prepared by CSA as at 28.07.2016. Price: Au= US$1,100/oz. Revised estimate prepared by Polymetal as at 01.01.2017 (onlystoping). Ore Reserves are presented in accordance with the Company's ownership equal to 25%.
8) Stockpiled Ore Reserves.
9) Initial estimate prepared by Polymetal as at 01.01.2016. Price: Au= US$1,100/oz, Ag = US$15/oz. Revised estimate was not performed due to lack of material changes.
10) Initial estimate prepared by Polymetal as at 01.07.2014. Price: Au= US$1,300/oz, Ag = US$20/oz, Cu = US$7,000/t, Zn = US$1,700/t. Revised estimate was not performed due to lack of material changes.
11) Stockpiled Ore Reserves.
12) Stockpiled Ore Reserves.
13) Estimate prepared by RPA Inc. as at 01.01.2015. Price: Au = US$1,200/oz. Revised estimate was not performed due to lack of material changes.
14) Initial estimate prepared by Snowden as at 01.01.2014. Price: Au= US$1,300/oz. Revised estimate prepared by Polymetal as at 01.01.2017(only stoping without Au price change). Ore Reserves are presented in accordance with the Company's ownership equal to 42.65%.
15) Initial estimate prepared by Snowden as at 01.01.2015. Price: Au= US$1,300/oz (only Ore Reserves estimate for Heap Leach). Revised estimate was not performed due to lack of material changes.


Mineral Resources as at 1 January 2017(1)
Tonnage
Grade
Content

Kt
Au, g/t
Ag, g/t
Cu, %
GE, g/t
Au, Koz
Ag, Koz
Cu, Kt
GE, Koz
Measured









Standalone Mines









Albazino 
30
4.3
-
-
4.3
5
-
-
5










Dukat hub
100



13.8
-
3,310
-
42
Goltsovoye
100
-
1,075
-
13.8
-
3,310
-
42










Varvara hub
6,860



1.4
198
-
21.1
299
Varvara (4)
5,880
0.8
-
0.40
1.3
154
-
21.1
255
Maminskoye (6)
980
1.4
-
-
1.4
44
-
-
44










Omolon hub
230



4.6
22
1,055
-
34
Sopka Kvartsevaya 
200
2.7
136
-
4.3
17
856
-
27
Oroch
30
4.9
198
-
7.5
5
199
-
8










Voro hub
80



2.1
6
11
-
6
Voro 
80
2.1
4
-
2.1
6
11
-
6










Development and exploration projects









Kutyn (22)
740
4.1
-
-
4.1
97
-
-
97
Total Measured
8,040



1.9
327
4,375
21.1
483










Indicated









Standalone Mines









Albazino 
2,220
5.1
-
-
5.1
361
-
-
361










Dukat hub
510



19.4
62
19,887
-
317
Goltsovoye
40
-
1,025
-
13.1
-
1,277
-
16
Primorskoye (3)
470
4.2
1,238
-
20.0
62
18,610
-
301










Varvara hub
18,310



1.6
772
90
33.5
941
Varvara (4)
12,630
1.1
-
0.57
1.4
447
-
27.8
581
Komar (5)
3,540
2.1
-
-
2.1
238
-
-
238
Maminskoye (6)
1,150
1.5
-
-
1.5
55
-
-
55
Tarutin (7)
450
0.1
6
1.25
2.5
1
90
5.7
37
Dolinnoye (8)
540
1.8
-
-
1.8
31
-
-
31










Omolon hub
600



9.8
121
5,671
-
189
Sopka Kvartsevaya 
110
4.4
161
-
6.3
16
589
-
23
Oroch
180
3.5
314
-
7.7
21
1,840
-
45
Irbychan (10)
240
8.9
189
-
11.3
68
1,439
-
86
Nevenrekan (12)
70
7.1
784
-
15.1
16
1,803
-
35










Voro hub
1,690



5.6
196
1,984
16.1
305
Voro
30
1.9
5
-
2.0
2
4
-
2
Tamunier (13)
870
4.6
23
-
4.8
130
655
-
133
Saum (14)
790
2.5
52
2.04
6.7
65
1,325
16.1
171











Tonnage
Grade
Content

Kt
Au, g/t
Ag, g/t
Cu, %
GE, g/t
Au, Koz
Ag, Koz
Cu, Kt
GE, Koz
Armenia
6,480



4.1
640
7,545
26.6 
858
Kapan (18)
3,650
3.1
52
0.52
4.5
361
6,079
18.9
522
Lichkvaz (19)
2,830
3.1
16
0.27
3.7
279
1,466
7.7 
336










Development and exploration projects









Kyzyl project (Bakyrchik) (20)
2,740
6.2
-
-
6.2
545
-
-
545
Kutyn (22)
2,070
4.2
-
-
4.2
279
-
-
279
Total Indicated
34,620



3.4
2,977
35,178
76.3
3,796










Measured + Indicated








Standalone Mines









Albazino 
2,250
5.1
-
-
5.1
366
-
-
366










Dukat hub
610



18.4
62
23,197
-
360
Goltsovoye
140
-
1,060
-
13.6
-
4,587
-
59
Primorskoye (3)
470
4.2
1,238
-
20.0
62
18,610
-
301










Varvara hub
25,170



1.5
970
90
54.6
1,241
Varvara (4)
18,510
1.0
-
0.48
1.4
601
-
48.9
836
Komar (5)
3,540
2.1
-
-
2.1
238
-
-
238
Maminskoye (6)
2,130
1.4
-
-
1.4
99
-
-
99
Tarutin (7)
450
0.1
6
1.25
2.5
1
90
5.7
37
Dolinnoye (8)
540
1.8
-
-
1.8
31
-
-
31










Omolon hub
830



8.4
143
6,726
-
223
Sopka Kvartsevaya 
310
3.3
145
-
5.0
33
1,445
-
50
Oroch
210
3.7
297
-
7.6
26
2,039
-
52
Irbychan (10)
240
8.9
189
-
11.3
68
1,439
-
86
Nevenrekan (12)
70
7.1
784
-
15.1
16
1,803
-
35










Voro hub
1,770



5.5
202
1,995
16.1
311
Voro
110
2.1
4
-
2.1
7
14
-
7
Tamunier (13)
870
4.6
23
-
4.8
130
655
-
133
Saum (14)
790
2.5
52
2.04
6.7
65
1,325
16.1
171










Armenia
6,480



4.1
640
7,545
26.6 
858
Kapan (18)
3,650
3.1
52
0.52
4.5
361
6,079
18.9
522
Lichkvaz (19)
2,830
3.1
16
0.27
3.7
279
1,466
7.7 
336










Development and exploration projects









Kyzyl project (Bakyrchik) (20)
2,740
6.2
-
-
6.2
545
-
-
545
Kutyn (22)
2,810
4.2
-
-
4.2
376
-
-
376
Total Measured + Indicated
42,660



3.1
3,304
39,553
97.3
4,279










Inferred









Standalone Mines









Albazino
7,610
5.3
-
-
5.3
1,300
-
-
1,300

Tonnage
Grade
Content

Kt
Au, g/t
Ag, g/t
Cu, %
GE, g/t
Au, Koz
Ag, Koz
Cu, Kt
GE, Koz
Mayskoye
8,450
11.9
-
-
11.9
3,239
-
-
3,239










Dukat hub
900



9.9
44
19,835
-
286
Dukat 
450
1.9
833
-
11.8
27
11,933
-
169
Lunnoye
230
1.8
346
-
6.0
13
2,629
-
46
Goltsovoye
80
-
940
-
12.1
-
2,484
-
32
Arylakh
90
0.9
639
-
8.7
2
1,782
-
24
Perevalnoye (2)
20
-
564
-
7.7
-
379
-
5
Primorskoye (3)
30
1.8
787
-
11.8
1
629
-
9










Varvara hub
26,230



1.7
1,223
125
43.3
1,439
Varvara (4)
19,720
1.1
-
0.61
1.4
726
-
37.4
906
Komar (5)
3,670
2.4
-
-
2.4
279
-
-
279
Tarutin (7)
350
0.1
11
1.71
3.5
1
125
5.9
39
Dolinnoye (8)
2,490
2.7
-
-
2.7
216
-
-
216










Omolon hub
920



12.1
271
7,510
-
359
Sopka Kvartsevaya 
50
2.3
98
-
3.7
4
150
-
5
Oroch
210
6.2
509
-
12.9
42
3,489
-
88
Olcha
160
10.0
44
-
10.5
53
236
-
56
Tsokol Kubaka
70
9.3
17
-
9.5
22
40
-
22
Burgali (9)
50
11.9
15
-
12.0
21
26
-
21
Irbychan (10)
20
19.3
265
-
22.6
10
141
-
12
Yolochka (11)
240
11.1
10
-
11.2
85
73
-
86
Nevenrekan (12)
120
8.6
861
-
17.3
33
3,355
-
68










Voro hub
3,930



4.0
490
1,096
1.0
502
Tamunier (13)
3,880
3.9
8
-
3.9
488
1,041
-
493
Saum (14)
50
1.4
33
1.82
4.9
2
55
1.0
8










Okhotsk hub
3,202



5.2
518
1,477
-
534
Avlayakan
20
32.7
133
-
34.3
19
77
-
20
Levoberezhny (15)
2,800
4.0
13
-
4.2
365
1,208
-
378
Kirankan (16)
142
6.5
8
-
6.7
30
39
-
30
Maimakan-Kundumi (17)
240
13.5
20
-
13.7
105
154
-
106










Armenia
12,860



4.0
1,128
17,845
65.2
1,651
Kapan (18)
11,390
2.6
47
0.50
3.8
934
17,253
57.0
1,406
Lichkvaz (19)
1,470
4.1
13
0.55
5.2
194
622
8.2
245










Development and exploration projects









Kyzyl project (Bakyrchik) (20)
11,420
7.0
-
-
7.0
2,562
-
-
2,562
Veduga (21)
580
4.1
-
-
4.1
77
-
-
77
Kutyn (22)
2,110
4.0
-
-
4.0
273
-
-
273
Total Inferred
78,212



4.9
11,124
47,918
109.4
12,221










Measured + Indicated + Inferred





Standalone Mines









Albazino 
9,860
5.3
-
-
5.3
1,665
-
-
1,665

Tonnage
Grade
Content

Kt
Au, g/t
Ag, g/t
Cu, %
GE, g/t
Au, Koz
Ag, Koz
Cu, 
Kt
GE, Koz
Mayskoye
8,450
11.9
-
-
11.9
3,239
-
-
3,239










Dukat hub
1,510



13.3
106
43,032
-
645
Dukat 
450
1.9
833
-
11.8
27
11,933
-
169
Lunnoye
230
1.8
346
-
6.0
13
2,629
-
46
Goltsovoye
220
-
1,015
-
13.0
-
7,071
-
91
Arylakh
90
0.9
639
-
8.7
2
1,782
-
24
Perevalnoye (2)
20
-
564
-
7.7
-
379
-
5
Primorskoye (3)
500
4.0
1,216
-
19.6
64
19,239
-
311










Varvara hub
51,400



1.6
2,193
215
97.8
2,680
Varvara (4)
38,230
1.1
-
0.53
1.4
1,327
-
86.2
1,742
Komar (5)
7,210
2.2
-
-
2.2
517
-
-
517
Maminskoye (6)
2,130
1.4
-
-
1.4
99
-
-
99
Tarutin (7)
800
0.1
8
1.45
2.9
3
215
11.6
76
Dolinnoye (8)
3,030
2.5
-
-
2.5
247
-
-
247










Omolon hub
1,750



10.3
414
14,235
-
582
Sopka Kvartsevaya 
360
3.2
139
-
4.8
37
1,595
-
55
Oroch
420
4.9
403
-
10.2
68
5,528
-
141
Olcha
160
10.0
44
-
10.5
53
236
-
56
Tsokol Kubaka
70
9.3
17
-
9.5
22
40
-
22
Burgali (9)
50
11.9
15
-
12.0
21
26
-
21
Irbychan (10)
260
9.6
194
-
12.0
78
1,580
-
98
Yolochka (11)
240
11.1
10
-
11.2
85
73
-
86
Nevenrekan (12)
190
8.0
832
-
16.5
50
5,157
-
102










Voro hub
5,700



4.4
692
3,091
17.1
812
Voro
110
2.1
4
-
2.1
7
14
-
7
Tamunier (13)
4,750
4.0
11
-
4.1
618
1,696
-
626
Saum (14)
840
2.5
51
2.03
6.6
67
1,380
17.1
179










Okhotsk hub
3,202



5.2
518
1,477
-
534
Avlayakan
20
32.7
133
-
34.3
19
77
-
20
Levoberezhny (15)
2,800
4.0
13
-
4.2
365
1,208
-
378
Kirankan (16)
142
6.5
8
-
6.7
30
39
-
30
Maimakan-Kundumi (17)
240
13.5
20
-
13.7
105
154
-
106










Armenia
19,340



4.0
1,769
25,422
91.8
2,510
Kapan (18)
15,040
2.7
48
0.50
4.0
1,295
23,333
75.9
1,928
Lichkvaz (19)
4,300
3.4
15
0.37
4.2
474
2,089
15.9
582










Development and exploration projects









Kyzyl project (Bakyrchik) (20)
14,160
6.8
-
-
6.8
3,107
-
-
3,107
Veduga (21)
580
4.1
-
-
4.1
77
-
-
77
Kutyn (22)
4,920
4.1
-
-
4.1
649
-
-
649
Total Measured + Indicated + Inferred
120,872



4.2
14,429
87,472
206.7
16,501
1) ineral Resources are reported in accordance with the JORC Code (2012). Mineral Resources are additional to Ore Reserves. Discrepancies in calculations are due to rounding.
2) Initial estimate prepared by Polymetal as at 01.01.2016. Price: Ag = US$15/oz, Pb = US$1,700/t. Revised estimate was not performed due to lack of material changes.
3) Estimate prepared by CSA Global Pty Ltd as at 01.01.2017. Price: Au = US$1,250/oz, Ag = US$16 /oz.
4) Cu estimate is listed for fresh ore and powder ore that has high Cu grade (total Mineral Resources for fresh ore and powder ore with high Cu grade of 10.5 and 5.7 Mt of ore respectively).
5) Initial estimate prepared by Polymetal as at 01.07.2016. Price: Au = US$1,100/oz. Revised estimate as at 01.01.2017.
6) Estimate prepared by Polymetal as at 01.01.2014. Price: Au = US$1,300/oz. Revised estimate was not performed due to lack of material changes.
7) Initial estimate prepared by Polymetal as at 01.01.2016. Price: Au= US$1,100/oz, Ag = US$15/oz, Cu = US$5,000/t. Revised estimate was not performed due to lack of material changes. ineral Resources are presented in accordance with the Company's ownership equal to 75%.
8) Initial estimate prepared by CSA as at 28.07.2016. Price: Au= US$1,100/oz. Revised estimate prepared by Polymetal as at 01.01.2017 (only stoping). ineral Resources are presented in accordance with the Company's ownership equal to 25%.
9) Estimate prepared by Polymetal as at 01.01.2016. Price: Au = US$1,100/oz, Ag = US$15/oz. Revised estimate was not performed due to lack of material changes.
10) Initial estimate prepared by Polymetal as at 01.01.2016. Price: Au = US$1,100/oz, Ag = US$15/oz. Revised estimate was not performed due to lack of material changes.
11) Initial estimate prepared by Polymetal as at 01.01.2016. Price: Au = US$1,100/oz, Ag = US$15/oz. Revised estimate was not performed due to lack of material changes.
12) Initial estimate prepared by Polymetal as at 01.01.2016. Price: Au = US$1,100/oz, Ag = US$15/oz. Revised estimate was not performed due to lack of material changes.
13) Estimate prepared by Polymetal as at 01.01.2016. Price: Au = US$1,100/oz, Ag = US$15/oz. Revised estimate was not performed due to lack of material changes.
14) Initial estimate prepared by Polymetal as at 01.01.2017. ineral Resources are presented in accordance with the Company's ownership equal to 80%.
15) Initial estimate prepared by Polymetal as at 01.01.2017.
16) Estimate prepared by Snowsden as at 01.07.2011. Price: Au = US$1,150/oz, Ag = US$18.5/oz. Revised estimate was not performed due to lack of material changes.
17) Initial estimate prepared by Polymetal as at 01.01.2017.
18) Initial estimate prepared by CSA as at 31.12.2014. Price: Au= US$1,300/oz, Ag = US$20/oz, Cu = US$6,600/t, Zn = US$2,200/t. Revised estimate prepared by Polymetal as at 01.01.2017 (only stoping). Zinc in the amount of 263 kt is not included in GE calculation.
19) Initial estimate prepared by CSA as at 01.01.2016. Price: Au= US$1,100/oz, Ag = US$15/oz, Cu = US$5,000/t. Revised estimate was not performed due to lack of material changes.
20) Estimate prepared by RPA Inc. as at 01.01.2015. Price: Au = US$1,200/oz. Revised estimate was not performed due to lack of material changes.
21) Initial estimate prepared by Snowden as at 01.01.2014. Price: Au= US$1,300/oz. Revised estimate prepared by Polymetal as at 01.01.2017. Mineral Resources are presented in accordance with the Company's ownership equal to 42.65%.
22) Initial estimate for open pit prepared by Snowden, for underground by CSA Global Pty Ltd as at 01.01.2015. Price: Au = US$1,300/oz. Revised estimate was not performed due to lack of material changes.


PGM Mineral Resources as at 1 January 2017(1)
Tonnage
Grade
Content

Mt
Pd, g/t
Pt, g/t
Au, g/t
Cu, 
%
PdEq(2), g/t
Pd, Moz
Pt, Moz
Au, 
Moz
Cu, 
Kt
PdEq, Moz
Indicated











Viksha project(3)











Viksha
27
0.6
0.2
0.1
0.10
1.4
0.5
0.1
0.1
29.6
1.3
Kenti
-
-
-
-
-
-
-
-
-
-
-
Shargi
-
-
-
-
-
-
-
-
-
-
-
Total Indicated
27
0.6
0.2
0.1
0.10
1.4
0.5
0.1
0.1
29.6
1.3












Inferred











Viksha project(3)











Viksha
52
0.6
0.2
0.1
0.09
1.3
1.0
0.3
0.2
49.5
2.3
Kenti
98
0.6
0.2
0.1
0.11
1.3
1.9
0.6
0.4
109.6
4.3
Shargi
36
0.6
0.2
0.1
0.08
1.3
0.7
0.2
0.1
31.7
1.5
Total Inferred
186
0.6
0.2
0.1
0.10
1.3
3.6
1.1
0.7
190.8
8.1












Indicated + Inferred









Viksha project(3)











Viksha
79
0.6
0.2
0.1
0.10
1.4
1.5
0.4
0.3
79.1
3.6
Kenti
98
0.6
0.2
0.1
0.11
1.3
1.9
0.6
0.4
109.6
4.3
Shargi
36
0.6
0.2
0.1
0.08
1.3
0.7
0.2
0.1
31.7
1.5
Total Indicated + Inferred
213
0.6
0.2
0.1
0.10
1.3
4.2
1.4
0.9
220.6
9.5
1) ineral Resources are reported in accordance with the JORC Code (2012). Mineral Resources are additional to Ore Reserves. Discrepancies in calculations are due to rounding.
2) PdEq is calculated using the following formula: PdEq = Pd(g/t) + Pt(g/t) *1.57 + Au(g/t) * 1.61 + Cu(%) * 2.33.
3) Initial estimate prepared by AMC Consultants as at 01.03.2015 using COG (PdEq) = 0.5 g/t/. Revised estimate was not performed due to lack of material changes.
This estimate was prepared by employees of JSC Polymetal Management Company and JSC Polymetal Engineering, subsidiaries of the Company, led by Mr. Valery Tsyplakov, who assumes overall responsibility for the Mineral Resources and Ore Reserves Report. 
Mr. Tsyplakov is the employed full-time as the Managing Director of JSC Polymetal Engineering and has more than 16 years' experience in gold, silver and polymetallic mining. He is a Member of the Institute of Materials, Minerals & Mining (MIMMM), London, and a Competent Person under the JORC Code. 
Listed below are other Competent Persons employed by the Company that are responsible for relevant research on which the Mineral Resources and Ore Reserves estimate is based:
 Geology and Mineral Resources - Roman Govorukha, Head of Geologic Modelling and Monitoring Department, MIMMM, with 16 years' relevant experience;
 Mining and Ore Reserves - Igor Epshteyn, Head of Mining Process Department, MIMMM, with 35 years' relevant experience;
 Concentration and Metals - Igor Agapov, Deputy Director of Science and Technology, MIMMM, with 19 years' relevant experience;
 Environmental issues - Tatiana Kuleshova, Director for Ecology, MIMMM, with 26 years' relevant experience.
All the above mentioned Competent Persons have sufficient experience that is relevant to the style of mineralisation and types of deposits under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (JORC Code).
All Competent Persons have given their consent to the inclusion in the report of the matters based on their information in the form and context in which it appears.
Metals prices used in estimating Mineral Resources and Ore Reserves are listed below (unless otherwise indicated in the footnotes):
Au = US$1,200/oz;
Ag = US$16.0/oz;
Cu = US$4,500/t;
Gold equivalent data is based on "Conversion ratios of metals into gold equivalent" provided in the Appendix below. Lead and zinc Ore Reserves and Mineral resources have not been assessed due to immateriality and are not included in the calculation of the gold equivalent.
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FORWARD-LOOKING STATEMENTS
THIS RELEASE MAY INCLUDE STATEMENTS THAT ARE, OR MAY BE DEEMED TO BE, "FORWARD-LOOKING STATEMENTS". THESE FORWARD-LOOKING STATEMENTS SPEAK ONLY AS AT THE DATE OF THIS RELEASE. THESE FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY, INCLUDING THE WORDS "TARGETS", "BELIEVES", "EXPECTS", "AIMS", "INTENDS", "WILL", "MAY", "ANTICIPATES", "WOULD", "COULD" OR "SHOULD" OR SIMILAR EXPRESSIONS OR, IN EACH CASE THEIR NEGATIVE OR OTHER VARIATIONS OR BY DISCUSSION OF STRATEGIES, PLANS, OBJECTIVES, GOALS, FUTURE EVENTS OR INTENTIONS. THESE FORWARD-LOOKING STATEMENTS ALL INCLUDE MATTERS THAT ARE NOT HISTORICAL FACTS. BY THEIR NATURE, SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER IMPORTANT FACTORS BEYOND THE COMPANY'S CONTROL THAT COULD CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. SUCH FORWARD-LOOKING STATEMENTS ARE BASED ON NUMEROUS ASSUMPTIONS REGARDING THE COMPANY'S PRESENT AND FUTURE BUSINESS STRATEGIES AND THE ENVIRONMENT IN WHICH THE COMPANY WILL OPERATE IN THE FUTURE. FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE. THERE ARE MANY FACTORS THAT COULD CAUSE THE COMPANY'S ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED IN SUCH FORWARD-LOOKING STATEMENTS. THE COMPANY EXPRESSLY DISCLAIMS ANY OBLIGATION OR UNDERTAKING TO DISSEMINATE ANY UPDATES OR REVISIONS TO ANY FORWARD-LOOKING STATEMENTS CONTAINED HEREIN TO REFLECT ANY CHANGE IN THE COMPANY'S EXPECTATIONS WITH REGARD THERETO OR ANY CHANGE IN EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICH ANY SUCH STATEMENTS ARE BASED.


Appendix
ReportingofMetalEquivalents
Gold equivalent conversion ratio 
AuEqv=Me/k
Where Me is the evaluated metal content (silver g/t, copper %)
Where k is the silver to gold equivalent conversion rate that is calculated considering the difference in metals value issuing the following formula:
For silver: k=((Au price/31.1035 - (Au price /31.1035 - treatment charge Au)*(Royalty Au)/100 - (treatment charge Au))*(recovery Au)/((Ag price/31.1035 - (Ag price/31.1035 - treatment charge Ag)*(Royalty Ag)/100 - (treatment charge Ag))*(recovery Ag)),
for copper (%): k = 100*((Au price/31.1035-treatment charge Au)*(1-royalty Au%/recovery Au%)*(recovery Au%))/((Cu price-treatment charge Cu)*(1-royalty Cu%/recovery Cu%)*(recovery Cu%)),
where Royalty is the mineral extraction tax at applicable rate, recovery - the life-of-mine expected recovery of the respective metal in the processing technology applied.
Silver/gold equivalent and copper/gold equivalent conversion ratios:
Deposit
Ore processing technology
k
Ag
Cu
Dukat
Conventional flotation
84

Lunnoye
Cyanidation+Merrill Crowe process
81

Goltsovoye
Conventional flotation
78

Arylakh
Cyanidation+Merrill Crowe process
81

Perevalnoye
Conventional flotation
73

Primorskoye
Conventional flotation
78

Varvara
Powder ore with high copper content (1)

0.67
Primary ore with high copper content - conventional flotation 

0.67
Tarutin
Primary ore - conventional flotation
94
0.53
Oxidised ore - conventional flotation
94
0.53
Birkachan
Cyanidation arbon-in-pulp
81

Heap leaching+arbon-in-colon
106

Sopka Kvartsevaya
Cyanidation+Merrill Crowe process
76

Heap leaching+Merrill Crowe process
110

Oroch
Cyanidation+Merrill Crowe process
76

Olcha
Cyanidation+Merrill Crowe process
86

Dalneye
Cyanidation+Merrill Crowe process
99

Heap leaching+Merrill Crowe process
130

Tsokol Kubaka
Cyanidation arbon-in-pulp
92

Burgali
Cyanidation+Merrill Crowe process
115

Irbychan
Cyanidation+Merrill Crowe process
80

Yolochka
Cyanidation arbon-in-pulp
91

Nevenrekan
Cyanidation+Merrill Crowe process
98

Voro
Heap leaching+Merrill Crowe process
233

Cyanidation arbon-in-pulp
117

North Kaluga
Conventional flotation
91
0.68
Tamunier
Conventional flotation
199

Saum
Conventional flotation
67
0.60
Svetloye
Heap leaching+Merrill Crowe process
639

Avlayakan
Cyanidation+Merrill Crowe process
86

Ozerny
Cyanidation+Merrill Crowe process
107

Khakanja
Cyanidation+Merrill Crowe process
102

Levoberezhnoye
Cyanidation arbon-in-pulp
88

Kirankan (2)
Cyanidation+Merrill Crowe process
60

Maimakan-Kundumi
Cyanidation+Merrill Crowe process
86

Kapan
Conventional flotation
82
0.70
Lichkvaz
Conventional flotation
100
0.59
1) This type of ore is currently not being processed, it is stockpiled and reflected only in Mineral Resources.
2) Silver to gold equivalent conversion ratios were not recalculated to deposits that were evaluated in 2011-2012.

This information is provided by RNS
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