12th May 2014 08:25
LONDON (Alliance News) - Polymetal International PLC Monday announced the completion of its Reserves and Resources Audit for the Svetloye Gold Deposit, which offers the company additional medium-term low-risk and low-cost production of around 70,000 ounces of gold per year and positive cash flows.
The gold, silver and copper-mining exploration and production company, with operations in Russia and Kazakhstan, said Snowden Mining Industry Consultants estimates Total Ore Reserves at 7.3 million tonnes at an average grade of 2.8 grams per tonne of gold, for a total of 700,000 ounces of gold contained.
The consultants also found Total Mineral Resources at 1.1 million tonnes of ore at an average grade of 2.3 grams per tonne of gold, for a total of 100,000 ounces of gold.
The company said its pre-feasibility study based on the results expects a 1.0 million tonnes per year open-pit heap leach operation at the site, giving it an initial mine life of eight years, which should mean it can produce an annual average of 70,000 ounces of gold at an average all-in sustaining cash cost of USD750-USD800 per ounce of gold.
Polymetal said pre-production capital expenditures for the site are estimated at USD90 million but it noted that the site could achieve significantly more value through using equipment from its Khakanja and Omolon sites, or expanding the reserve base of the project.
The company said the project is expected to go under board review in the third quarter and, if agreed, construction would commence in 2015 towards first production in the third quarter 2017.
Svetloye is located in the Far East of Russia, and Polymetal acquired the site in 2010 for a total payment of USD9.3 million.
Polymetal shares were up 2.5% to 566.50 pence, putting it in the top three FTSE 250 risers in early trading Monday.
By Tom McIvor; [email protected]; @TomMcIvor1
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