Approval of Monchetundra Mine Permit Application

RNS Number : 2207U

Eurasia Mining PLC

11 July 2018

 

Eurasia Mining plc (AIM: EUA)

("Eurasia" or the "Company")

MNR approval of Monchetundra Mine permit application

Eurasia Mining plc (AIM: EUA), PGM and gold producing company is pleased to announce that the Ministry of Natural Resources ("MNR") has approved the Company's application for a Mining permit at Monchetundra and has now delivered the mine permit application to the office of Prime Minister Dmitry Medvedev for final authorisation.

The MNR approval was the final relevant Russian agency approval required for the Mining permit application. All necessary documentation with regard to the projects technical, financial and operational features has been received and accepted by the MNR and forwarded to the Prime Minister's office. The office of the prime minister will now make a final decision on whether to authorise and finally grant the mining permit, and there can at this point be no guarantee that the mining permit will be granted.

 Highlights

·     Ministry of Natural Resources, the parent organisation to Rosnedra, the federal subsoil licensing agency, has approved the mine permit application for the Monchetundra Project

·     Mine permit now with the office of the Prime Minister for final approval

·     Final notice of the approval of the Mining permit application, should approval be given, may be given publicly and without prior notice to the company or its representatives.

Christian Schaffalitzky, Managing Director for Eurasia, commented: "We are delighted to have now reached the final step in this process which commenced on submission of the mine permit application in December 2017. Our experience with the West Kytlim mine permit application is that this final approval can arrive without notice and soon after submission, in the case of West Kytlim in less than three weeks."

Further details on the Monchetundra Project

Monchetundra is Eurasia's 80% owned 2 million-ounce PGM (Reserve + Resource) project near the town of Monchegorsk on Kola Peninsula. A feasibility study and reserves estimate for the contained reserves and resources achieved state approvals in May 2017 (see announcement dated 31 May 2017). Subsequently, a discovery certificate, which guarantees mining rights to the holder, was issued in July 2017 for the reserves and resources contained within two open pittable locations, Loipishnune and West Nittis. A mining license application proceeded directly on receipt of the discovery certificate and later achieved provisional approval from Rosnedra, the Russian ministry for subsoil use. The application was later reviewed by the Federal Anti-Monopoly Service before being approved by both the Federal Securities Service (FSB) and Ministry of Defence (MOD). The Federal Anti-Monopoly Service, also reviewed the application before forwarding to the FSB and MOD. The permit application has now been approved at the Ministry for Economic Development and progresses to the Ministry of Natural Resources, the ministry which governs Rosnedra the federal agency for subsoil use. On approval at the Ministry for Natural Resources the application is signed by the office of Prime Minister as finally granted.

Currently, state approved reserves and resources within the Monchetundra Project comprise Russian standard C1 and C2 categories of 55.9 tonnes (about 2 million ounces) palladium equivalent (predominantly palladium) at two open-pittable locations, West Nittis and Loipishnune.  These open pits also contain significant gold and base metal credits including 28,124 tonnes of copper, 30,410 tonnes of nickel and 2 tonnes of gold. The PGM resources are palladium rich with an average palladium to platinum ratio of 2:1. Directors believe the project to be unique globally in being lead by high palladium grades, and that it represents a significant lower cost open pit mining operation which compares favourably to the relatively expensive underground operations in South Africa, the dominant player in the global PGM market.

Engineering Procurement Construction and Financing (EPCF) Contract

As previously announced, an EPCF (Engineering, Procurement, Construction & Finance) agreement is already in place with Sinosteel, a Chinese state owned major infrastructure project group. 85 per cent (or US$149,600,000) of the contract value has been arranged as debt-based by Sinosteel - this element of plant construction costs will remain on the Sinosteel balance sheet until such time as the plant is operating at full capacity and to designed specification. A further US$50,000,000 sub-contract has been assigned by Sinosteel to Eurasia's subsidiary Terskaya Gornaya Kompany(TGK) for the development of the two open pits in preparation for mining and may be drawn down in advance of the main mine construction.

Discussions continue with other third-party service providers regarding the running of the mine at Monchetundra. The Company hopes to emulate the contract mining arrangement utilised at West Kytlim by contracting the mining operation to a reputable international specialist company with experience in Russia, while maintaining control of the project, for a percentage of gross revenue.

Consent for release

Christian Schaffalitzky, FIMMM, PGeo, CEng, is a director of the Company. He has reviewed the update and consents to the inclusion of the exploration information in the form and context in which it appears here. He is a Competent Person for the purposes of the reporting of these results.

This announcement includes inside information as defined in Article 7 of the Market Abuse Regulation No. 596/2014 and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.

Enquiries:

Eurasia Mining PLC Christian Schaffalitzky / Keith Byrne	Tel: [phone]
WH Ireland Limited (Nominated Adviser & Broker) Katy Mitchell / James Sinclair-Ford	Tel: [phone]
First Equity Limited (Joint Broker)	Tel: [phone]
Jason Robertson

 

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