REG-Polymetal International plc Polymetal: Ore Reserves increase at Kutyn

Polymetal International PKAnnouncement

12/02/2020 07:05

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   Polymetal International plc (POLY)
   Polymetal: Ore Reserves increase at Kutyn

   12-Feb-2020 / 10:00 MSK
   Dissemination of a Regulatory Announcement, transmitted by EQS Group.
   The issuer is solely responsible for the content of this announcement.

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   Release time IMMEDIATE                      LSE, MOEX, AIX: POLY / ADR:
                AUCOY
   Date         12 February 2020

    

    

   Polymetal International plc

   Ore Reserves increase at Kutyn

   Polymetal is pleased to announce a twofold increase in Ore Reserves at the
   Kutyn gold project  to 0.8 Moz of  gold in accordance  with the JORC  Code
   (2012).

     • The updated  JORC-compliant open-pit  Ore Reserves  estimate as  at  1
       October 2019 comprises 8.4 Mt of ore with an average grade of 3.0  g/t
       containing 812 Koz of  gold. This represents a  110% increase in  gold
       contained in comparison with the previous reserve estimate prepared in
       2015 1  1 .
     • The growth of reserves is attributable to the updated geological model
       based on  32.3  km of  drilling  (440  diamond drill  holes)  and  180
       thousand m3 of trenching conducted in 2017-2019.
     • The reserves  represent  only  oxidised  material  suitable  for  heap
       leaching (average recovery based on extensive geometallurgical work is
       70.7%). Life-of-mine stripping ratio is 8.1 t/t.
     • The reserve  assessment is  based on  a  1.3 Mt  per year  heap  leach
       facility. The  flowsheet  envisions  two-stage  crushing  to  -40  mm,
       stacking by  truck  and the  Merrill-Crowe  process to  recover  gold.
       Annual average production is estimated  to be approximately 80 Koz  of
       gold.
     • Mineral Resources of Kutyn (additional to Ore Reserves) amount to  6.6
       Mt of ore for open-pit and underground mining with an average grade of
       3.7 g/t representing 785 Koz of gold contained.
     • 2020 work plan  at Kutyn  includes 13  km of  exploration drilling  to
       continue resource-to-reserve conversion as well as the commencement of
       statutory permitting and the establishment of a permanent access  road
       from the sea access point.

   "The new reserve estimate significantly enhances the value of Kutyn for  a
   potential acquirer or partner", said Vitaly Nesis, Group CEO of Polymetal.
   "We continue to evaluate various strategic options and plan to announce  a
   transaction in 2H 2020".

   Ore Reserves (Proved + Probable) changes

      Category     01.01.2015 01.10.2019 Change, %
     Tonnage, Mt      3.7        8.4       +130%
    Au grade, g/t     3.3        3.0        -9%
   Au content, Koz    386        812       +110%

    

    

   ORE RESERVE AND MINERAL RESOURCE STATAMENT 2  2 

   Kutyn Open Pit Ore Reserves

   Ore Reserves          Tonnage, Gold grade, Gold content,
                            Mt        g/t          Koz
   Proved                  1.9        3.5          211
                                                     
   Probable                6.5        2.9          601
                                                     
   Total Proved+Probable   8.4        3.0          812

   Kutyn Mineral Resources

   Mineral Resources          Tonnage, Gold grade, Gold content,
                                 Mt        g/t          Koz
   Measured
   Open-pit                     0.0        4.5           1
   Underground                  0.6        4.3          76
   Total Measured               0.6        4.3          77
                                                          
   Indicated
   Open-pit                     1.0        3.2          102
   Underground                  2.0        4.5          295
   Total Indicated              3.0        4.1          396
    
   Measured + Indicated
   Open-pit                     1.0        3.2          103
   Underground                  2.6        4.5          370
   Total Measured + Indicated   3.6        4.1          473
                                                          
   Inferred
   Open-pit                     2.5        2.9          228
   Underground                  0.6        4.3          84
   Total Inferred               3.1        3.2          312
    
   Measured + Indicated + Inferred
   Open-pit                     3.5        3.0          330
   Underground                  3.2        4.4          454
   Total Indicated + Inferred   6.6        3.7          785

   Note: Mineral Resources are additional  to Ore Reserves. Discrepancies  in
   calculations are due to rounding.

    

   ABOUT KUTYN

   Kutyn deposit is located in the Khabarovsk Territory, Far East Russia, 114
   km north-west of the  Albazino mine operated by  Polymetal and 10 km  from
   the Sea of  Okhotsk. The license  area covers 120  square kilometres.  The
   Kutyn site can  be accessed using  a winter  road and by  sea through  the
   deep-water Gulf of Ulban from July through October.

   Polymetal acquired the deposit in  2011. During the extensive  exploration
   campaign from 2012 through 2014, the Company completed a total of 31.8  km
   drilling and 245 thousand m3 of  trenching with the focus on  near-surface
   heap leachable  mineralisation  including  the  extensions  of  known  ore
   bodies. In September 2014, following the acquisition of the Kyzyl project,
   Polymetal announced  the decision  to postpone  development of  the  Kutyn
   project and suspended further exploration activities. The asset was marked
   for sale/JV due to relatively small size in terms of the Company's  target
   portfolio and focus on  Kyzyl and other  larger projects. The  exploration
   campaign was recommenced in 2017.

   To date, 10 zones of mineralisation have been identified extending for  up
   to 2  km along  strike. The  zones of  mineralisation are  represented  by
   several subparallel lenses with the average ore body thickness of 4 m.

   Competent persons

   This estimate  was  prepared  by employees  of  JSC  Polymetal  Management
   Company, Khabarovsk Branch  of JSC  Polymetal Management  Company and  JSC
   Polymetal Engineering, led by Mr. Vladimir Makhinya.

   Mr. Makhinya  is employed  full-time as  the Deputy  Director for  Mineral
   Resources, Khabarovsk Branch of Polymetal Management Company, and has more
   than 30 years' experience in gold, silver and polymetallic mining. Being a
   Member of the Institute of  Materials, Minerals & Mining (MIMMM),  London,
   he is a Competent Person under the JORC Code.

   Listed below are other Competent Persons  employed by the Company and  its
   subsidiaries that  are  responsible for  relevant  research on  which  the
   Mineral Resources and Ore Reserves estimate is based:

     • Mining and Ore Reserves:  Open Pit -  Anton Ignatov, Chief  Specialist
       for  Open-pit  Mining,  Technical  Department,  Polymetal   Management
       Company, MIMMM, with 17 years' relevant experience;
     • Concentration  and  Metals  -  Andrey  Galyutin,  Chief  Metallurgist,
       Khabarovsk Branch  of Polymetal  Management  Company, MIMMM,  with  20
       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.

    

   About Polymetal 

   Polymetal International (LSE, MOEX: POLY,  ADR: AUCOY) (together with  its
   subsidiaries - "Polymetal",  the "Company",  or the "Group")  is a  top-20
   global gold producer  and a top-5  global silver producer  with assets  in
   Russia and Kazakhstan. The  Company combines strong  growth with a  robust
   dividend yield.

   Enquiries

       Media                      Investor Relations
                              Polymetal
                                              3 ir@polymetalinternational.com
   FTI Consulting             Evgeny
                              Monakhov       +44 20 7887 1475 (UK)
   Leonid Fink     +44 20
                   3727 1000  Timofey         
   Viktor Pomichal            Kulakov
                                             +7 812 334 3666 (Russia)
                              Kirill
                              Kuznetsov
       Joint Corporate             
       Brokers
                   +44 20
   Morgan Stanley  7425 8000
                              RBC Europe
   Andrew Foster              Limited

   Richard Brown              Marcus Jackson +44 20 7653 4000

   Panmure Gordon             Jamil Miah

   James Stearns   +44 20
                   7886 2500

    

   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.

    

    

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    4  1  The previous Kutyn Ore Reserves and Mineral Reserves estimate was
   prepared as at 01 January 2015. The Ore Reserves and Mineral Resources
   audit was completed by Snowden Mining Industry Consultants for the open
   pit and the audit of Mineral Resources completed by CSA Global Pty Ltd
   ("CSA Global") for the underground.

    5  2  The Ore Reserves and Mineral Resources estimate is reported in
   accordance with the JORC Code (2012) as at 1 October 2019 using a gold
   price of US$ 1,300/oz and was prepared by Polymetal. The cut-off grade is
   0.5 g/t recoverable gold (by heap leach). The general cut-off grade at the
   real recovery rates for the entire Kutyn project was not calculated. The
   pits were optimised on the basis of total value for each of the blocks
   generated.

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   ISIN:          JE00B6T5S470
   Category Code: MSCM
   TIDM:          POLY
   Sequence No.:  46175
   EQS News ID:   972847


    
   End of Announcement EQS News Service

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References

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