Polymetal acquires controlling interest in Saum

RNS Number : 0014R

Polymetal International PLC

05 December 2016

 

Release time	IMMEDIATE
Date	5 December 2016

Polymetal International plc

Polymetal acquires controlling interest in Saum property

Polymetal International plc (LSE, MOEX: POLY, ADR: AUCOY) (together with its subsidiaries - "Polymetal", the "Company", or the "Group") is pleased to announce that it has acquired an 80% stake in Saum Mining Company LLC, a licence holder for the Saum polymetallic deposit ("Saum").

Polymetal has issued 1,120,690 new Company shares ("Consideration shares"), representing 0.26% of Polymetal's total increased share capital in connection with the acquisition of an 80% stake in Saum from an unconnected Russian seller. The total transaction value is approximately US$10.7 million.

Consideration shares are expected to be admitted to trading on the London Stock Exchange on 6 December 2016. Following admission, the total issued share capital of the Company will comprise 428,262,338 ordinary shares of no par value, each carrying one vote.

Location

The Saum licence covers an area of 34.2 km² in Russia's Sverdlovsk region in the Ural mountains. Saum is located 60 km from the town of Ivdel (population of approximately 16,000) and approximately 240 km from Polymetal's Voro processing plant. The closest paved road is 33 km away, the closest unpaved road is 15 km away, and the distance to the closest operational railway spur and power grid is approximately 45 km.

Historical exploration

Saum was discovered in 1971. Throughout the 1970s, 35 drill holes with a total length of 4,264 m were completed at the property. Exploration resumed in 2013 with a total diamond drilling volume of 2,228 m (28 drill holes). Metallurgical testwork and limited geotechnical analysis have also been undertaken. 

Saum Mineral Resources estimate, in accordance with the JORC Code (2012) as at 20 January 2016

	Tonnage	Grade					Content					Attributable resources GE (Koz)
	Mt	Cu (%)	Zn (%)	Au (g/t)	Ag (g/t)	GE, (g/t)	Cu (Kt)	Zn (Kt)	Au (Koz)	Ag (Moz)	GE, (Koz)
Inferred	1.5	1.9	1.2	1.3	30	5.4	29	18	64	1.2	259	208

Note: Metal prices used for the estimate: Au = US$ 1,200/oz, Ag = US$ 17.0/oz, Cu = US$ 4,500/t. GE means gold equivalent.

Saum is a volcanogenic massive sulfide polymetallic deposit. All identified ore bodies are confined to the package of sandstones and tuffs. Average ore body width is 30 meters with predominantly shallow dip. Resources were estimated up to the depth of 100 metres. The main minerals are gold-bearing pyrite, chalcopyrite and sphalerite. Oxidation is developed to the depths of 10 to 40 m. Mineralisation is open at depth and along strike in the western direction.

The deposit is suitable for open-pit mining. Oxidised ore is amenable to conventional cyanidation with recoveries in excess of 90% and represent potential source of feed for the existing CIP processing plant at Voro. Primary ore can be processed by conventional flotation followed by cyanide leaching of flotation tails with recoveries for all metals in the 80-90% range.

Polymetal is planning to prepare an Ore Reserves estimate in Q4 2017. Further drilling is planned on the property in 2017 and 2018.

"Saum furthers our strategy of accumulating resources for the potential upgrade of the Voro plant with a flotation circuit. High grade, shallow depth, and good infrastructure will enable capital-light and low-cost production from the deposit in the medium-term", said Vitaly Nesis, Group CEO of Polymetal.

 

Enquiries

Media		Investor Relations
FTI Consulting Leonid Fink Jenny Payne	[phone]	Polymetal Maxim Nazimok Evgenia Onuschenko Maryana Nesis	[e-mail] [phone] (Russia) [phone] (UK)
Joint Corporate Brokers
Morgan Stanley Sam McLennan Richard Brown	[phone]	RBC Europe Limited Tristan Lovegrove Marcus Jackson	[phone]

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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