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Polymetal International plc

Polymetal International plc 18% increase in Ore Reserves at Kyzyl gold deposit

Polymetal International (LON: POLY) has announced an 18% increase in Ore Reserves at Kyzyl gold deposit to 8.5 Moz of gold in accordance with the JORC Code (2012).

“We have concluded the first stage of extending open-pit life-of-mine at our flagship operation. The next step is to estimate Ore Reserves at East Bakyrchik in Q4 2020”, said Vitaly Nesis, Group CEO of Polymetal.

  • The updated JORC-compliant Ore Reserve estimate as of 1 July 2019 comprises 41.7 Mt of ore with an average grade of 6.3 g/t containing 8.5 Moz of gold. This represents an 18% increase in gold contained in comparison with the reserves as at the end of 20181.
  • Open-pit reserves increased by 37% to 4.2 Moz of gold contained at an average grade of 5.7 g/t, while underground reserves were up 4% to 4.3 Moz of gold contained at an average grade of 7.1 g/t.
  • Total life of mine extended by 8 years (to 2047), while life of mine for the open pit added 5 years (to 2031) in comparison with the previous Feasibility Study estimate conducted in 2015 (“FS”).
  • The updated Ore Reserve estimate incorporates data from the drilling campaign (additional 239 diamond drill holes, 41.5 km of drilling) which resulted in extension of mineralization zones within the existing ore bodies and update of the resource model.
  • Cut-off grades decreased from 2.0 g/t to 1.0 g/t for the open pit and from 3.7 g/t to 3.0 g/t for the underground compared to the previous FS. The decline was driven by lower mining and processing costs based on actual operational and economic data and lower concentrate processing and transportation expenses which now take into account concentrate processing at the Amursk POX.
  • The new mining schedule assumes increased capacity of the Kyzyl processing plant which grew from the originally designed 1.8 Mtpa to 2.0 Mtpa in 2019.

Ore Reserves (Proved + Probable) changes

Ore ReservesCategory01.01.2019[1]01.07.2019Change, %
Open pitTonnage, Mt13.622.968%
Au grade, g/t75.7-19%
Au content, Moz3.14.237%
UndergroundTonnage, Mt15.118.825%
Au grade, g/t8.57.1-16%
Au content, Moz4.14.34%
  TotalTonnage, Mt28.741.745%
Au grade, g/t7.86.3-19%
 Au content, Moz7.28.518%

Ore Reserves reconciliation, Moz

Ore Reserves, 01.01.2019DepletionRevaluationOre Reserves, 01.07.2019
7.2-0.21.58.5

Notes: Discrepancies in calculations are due to rounding. This note applies to all tables in this release.

ORE RESERVES

The Ore Reserve estimate is reported in accordance with the JORC Code (2012) as at 1 July 2019 using a gold price of US$ 1,200/oz and was prepared by Polymetal. A cut-off grade of 1.0 g/t of gold was applied for the open pit and 3.0 g/t for the underground. Ore Reserves were estimated solely for Zone 1 of the Bakyrchik deposit, Zone 2 (East Bakyrchik) reserves were not estimated.

Kyzyl Ore Reserves estimate as at 1 July 2019

Ore Reserves Tonnage,Gold grade,Gold content,
Mtg/tMoz
Proved   
Open pit1.26.30.3
Stockpiles0.55.90.1
Total Proved1.76.20.3
    
Probable   
Open pit21.25.73.9
Underground18.87.14.3
Total Probable40.06.38.1
    
Proved+Probable   
Open pit22.55.74.1
Underground18.87.14.3
Stockpiles0.55.90.1
Total Proved+Probable41.76.38.5

MINERAL RESOURCES

The Mineral Resources estimate for Zone 1 is reported in accordance with the JORC Code (2012) as at 1 July 2019 using a gold price of US$ 1,200/oz and was prepared by Polymetal. A cut-off grade of 1.0 g/t of gold was applied for the open pit and 3.0 g/t for the underground. The Mineral Resources estimate for Zone 2 was prepared by RPA Inc. in accordance with the JORC Code (2012) as at 1 January 2015. Cut-off grades for the open pit and the underground are 2.0 g/t and 3.7 g/t of gold, respectively. Revised estimate for Zone 2 was not conducted due to the lack of material changes.

Kyzyl Mineral Resources estimate

Mineral ResourcesTonnage,Gold grade,Gold content,
 Mtg/tMoz
Indicated   
Underground (Zone 1)2.350.4
Total Indicated2.350.4
Inferred
Open-pit0.53.80.1
  Zone 10.22.30.01
  Zone 20.34.80.05
Underground10.86.72.3
  Zone 12.46.40.5
  Zone 28.46.81.8
Total Inferred11.46.62.4
Indicated + Inferred
Open-pit0.53.80.1
  Zone 10.22.30.01
  Zone 20.34.80.05
Underground13.16.42.7
  Zone 14.75.70.9
  Zone 28.46.81.8
Total Indicated + Inferred13.66.32.8