Svetloye and development projects update

RNS Number : 5888Q

Polymetal International PLC

02 September 2014

 

Release time	IMMEDIATE
Date	2 September 2014

Polymetal International plc

Construction decision for Svetloye and development projects update

Polymetal International plc (LSE, MOEX: POLY, ADR: AUCOY) (together with its subsidiaries - "Polymetal", the "Company", or the "Group") is pleased to announce an update on its plans for the development and construction of the Svetloye gold project, and for the development of the Albazino-2, Kutyn and Maminskoye projects.

Following the forthcoming acquisition of the Kyzyl project, the Board has decided to re-prioritise the Company's internal project pipeline in order to focus capital and management resources on key priority projects and maintain a prudent level of leverage. It was decided to:

·      Proceed with the construction and development of the Svetloye gold project - a 1,000 Ktpa open pit heap leach operation with initial mine life of 8 years. Svetloye is a capital-light, low-risk project, which will provide low-cost production and cash flows in the medium-term. Production is expected to commence in Q3 2017 and is expected to run at nameplate capacity for the first full year. Svetloye is expected to add 70 Koz of gold to production at an average all-in sustaining cost of US$ 750-800/oz. Pre-production capital expenditures are estimated at US$90 million. For more information about the project, please see the press release published on 12 May 2014.

·      Terminate the development of the Albazino expansion project and incorporate additional resources into the life of mine with the existing processing capacity of the Albazino flotation plant. Polymetal will consider resuming work on the expansion should there be sufficient capital availability. Currently, mineral resources (in addition to reserves) are estimated at 25 Mt grading 4.8 g/t Au containing 3.6 Moz of gold. A new reserve and resource estimate is in progress and is expected in Q1 2015 as a part of an annual update of the reserves and resource statement.

·      Slow the development of the Kutyn gold project. Polymetal has ceased further exploration and is now working on completion of a statutory permitting and the pre-feasibility study by the end of Q2 2015.

·      Slow the development of the Maminskoye gold project. Polymetal has ceased exploration and postponed the pre-feasibility study.

"Following the acquisition of the Kyzyl project we have re-prioritised our project pipeline in order to focus our resources most effectively on low-risk and low-capital projects where we see clear scope for production growth and good upside potential." said Vitaly Nesis, CEO of Polymetal, "Going forward, we will continue to take a flexible view regarding our portfolio of development projects and will keep these under review."  

Enquiries

Media		Investor Relations
Instinctif Partners Leonid Fink Tony Friend	[phone]	Polymetal Maxim Nazimok Evgenia Onuschenko	[e-mail] [phone] (Russia) [phone] (UK)
Joint Corporate Brokers
Morgan Stanley Bill Hutchings Sam McLennan	[phone]	RBC Europe Limited Stephen Foss Jonny Hardy	[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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