PJSC Polyus (LSE, MOEX — PLZL) (“Polyus”, the “Company”), the largest gold producer in Russia, announces the results of its Ore Reserves and Mineral Resources review as at 31 December 2017 in accordance with JORC Code 2012.
Polyus’ Proved and Probable (P&P) Ore Reserves are estimated at 68 moz of gold. The Measured, Indicated and Inferred (MI&I) Mineral Resources stand at 190 moz, including 58 moz of Inferred Mineral Resource for Sukhoi Log, one of the world’s largest undeveloped gold deposits.
Polyus retains its status of the second largest company by attributable gold reserves and attributable gold resources among the world’s largest gold mining companies.
Ore Reserves Highlights
- Polyus’ Ore Reserves estimated at 68 moz of gold, down from 71 moz as of 31 December 2016, which reflects mining depletion during 2017.
- With processing at the Natalka Mill having been launched and now anticipated to be fully ramped up in the second half of 2018, over 95% of the Company’s Ore Reserves are located within the operating assets:
- The Krasnoyarsk Business Unit has the largest share of the Company’s Ore Reserves, with 28 moz of Ore Reserves reported at Olimpiada and 9.6 moz at Blagodatnoye.
- Ore Reserves at Verninskoye and Kuranakh were recorded at 5.1 moz and 4.4 moz, respectively.
- Natalka has estimated Ore Reserves of 16 moz.
- Polyus average Ore Reserve gold grade is estimated at 1.8 g/t, inclusive of Alluvial operations and lower grade ore for heap leaching operations. The gold grade of ore to be processed in plants stands at 2.0 g/t.
- In 2017, the Company launched a 180,000-metre drilling campaign at Sukhoi Log. Approximately 25,000 metres is now completed. Sukhoi Log’s Ore Reserves have not yet been estimated and the Company expects these to be included in its reserve statement in 2020.
- Further studies at Chertovo Koryto are expected to be completed in 2019 to enable update of the Ore Reserve estimate.
Mineral Resources Highlights
- The Company’s Mineral Resource estimates stand at 190 moz.
- More than 63% of the Company’s Mineral Resources are attributable to operational mines:
- Olimpiada’s Mineral Resources are estimated at 44 moz.
- Blagodatnoye’s Mineral Resources stand at 19 moz.
- Verninskoye and Kuranakh’s Mineral Resources include estimates of 12 moz and 9.0 moz, respectively.
- Natalka Mineral Resources amount to 34 moz.
- Inferred Mineral Resources for Sukhoi Log are estimated at 58 moz of gold grading 2.0 g/t. As previously outlined, the Company expects to upgrade the classification of a portion of this estimate from Inferred Mineral Resource before the end of 2018.
- At Bamskoye, the Company completed the exploration programme and expects to submit documentation to regulatory authorities in 2018.
Mineral Resource and Ore Reserve estimates
The Mineral Resource and Ore Reserve estimates are summarized in the Tables below. The effective date for the estimates is 31 December 2017. There is no material change to the estimates since the previous statement on 5 June 2017, apart from mining depletion.
Polyus Ore Reserve estimates as at 31 December 20171
| Deposit2 | Proved | Probable | Total | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Tonnes (Mt) |
Gold (g/t) |
Gold (Moz) |
Tonnes (Mt) |
Gold (g/t) |
Gold (Moz) |
Tonnes (Mt) |
Gold (g/t) |
Gold (Moz) |
|||||||||||||
| Mines in Operation | |||||||||||||||||||||
| Olimpiada | 6.5 | 2.9 | 0.6 | 288 | 2.9 | 27 | 295 | 2.9 | 28 | ||||||||||||
| Blagodatnoye | 52 | 0.9 | 1.6 | 164 | 1.5 | 8.0 | 216 | 1.4 | 9.6 | ||||||||||||
| Titimukhta | 5.3 | 1.6 | 0.3 | 6.3 | 3.1 | 0.6 | 12 | 2.4 | 0.9 | ||||||||||||
| Verninskoye | 12 | 1.3 | 0.5 | 82 | 1.7 | 4.6 | 94 | 1.7 | 5.1 | ||||||||||||
| Alluvials3 | 0.0 | 0.0 | 0.0 | 87 | 0.3 | 1.0 | 87 | 0.3 | 1.0 | ||||||||||||
| Kuranakh | 0.0 | 0.0 | 0.0 | 141 | 1.0 | 4.4 | 141 | 1.0 | 4.4 | ||||||||||||
| Natalka | 146 | 1.5 | 7.3 | 146 | 1.8 | 8.5 | 293 | 1.7 | 16 | ||||||||||||
| Development and Exploration Projects | |||||||||||||||||||||
| Chertovo Koryto |
0 | 0.0 | 0.0 | 62 | 1.5 | 3.1 | 62 | 1.5 | 3.1 | ||||||||||||
| Total4 | 222 | 1.4 | 10.2 | 976 | 1.8 | 57 | 1 ,199 | 1.8 | 68 | ||||||||||||
Polyus Mineral Resource estimates as at 31 December 2017
| Deposit2 | Measured | Indicated | Inferred | Total | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Tonnes (Mt) |
Grade (g/t) |
Gold (Moz) |
Tonnes (Mt) |
Grade (g/t) |
Gold (Moz) |
Tonnes (Mt) |
Grade (g/t) |
Gold (Moz) |
Tonnes (Mt) |
Grade (g/t) |
Gold (Moz) |
|||||||||||||
| Mines in Operation | ||||||||||||||||||||||||
| Olimpiada | 6.5 | 2.9 | 0.6 | 320 | 3.0 | 31 | 127 | 2.8 | 12 | 454 | 3.0 | 44 | ||||||||||||
| Blagodatnoye | 52 | 0.9 | 1.6 | 292 | 1.5 | 14 | 69 | 1.3 | 3.0 | 413 | 1.4 | 19 | ||||||||||||
| Titimukhta | 5.3 | 1.6 | 0.3 | 6.3 | 3.1 | 0.6 | 0.5 | 1.5 | 0.03 | 12 | 2.4 | 0.9 | ||||||||||||
| Verninskoye | 12 | 1.3 | 0.5 | 209 | 1.6 | 11 | 14 | 2.0 | 0.9 | 93 | 4.0 | 12 | ||||||||||||
| Alluvials3 | 0 | 0.0 | 0.0 | 224 | 0.2 | 1.4 | 34 | 0.4 | 0.4 | 258 | 0.2 | 1.9 | ||||||||||||
| Kuranakh | 0.0 | 0.0 | 0.0 | 153 | 1.1 | 5.4 | 97 | 1.2 | 3.7 | 250 | 1.1 | 9.1 | ||||||||||||
| Natalka | 150 | 1.7 | 8.2 | 261 | 1.8 | 15 | 148 | 2.1 | 9.9 | 558 | 1.9 | 34 | ||||||||||||
| Development and Exploration Projects | ||||||||||||||||||||||||
| Sukhoi Log5 | 0 | 0.0 | 0 | 0 | 0.0 | 0 | 887 | 2.0 | 58 | 887 | 2.0 | 58 | ||||||||||||
| Panimba | 5.0 | 2.3 | 0.4 | 11 | 2.3 | 0.8 | 24 | 1.8 | 1.4 | 40 | 2.0 | 2.6 | ||||||||||||
| Poputninskoye | 0 | 0.0 | 0 | 37 | 3.2 | 3.9 | 4.4 | 2.9 | 0.4 | 42 | 3.2 | 4.3 | ||||||||||||
| Zmeinoye | 0 | 0.0 | 0 | 0.9 | 5.0 | 0.1 | 2.0 | 4.5 | 0.3 | 2.9 | 4.6 | 0.4 | ||||||||||||
| Chertovo Koryto | 0 | 0.0 | 0 | 67 | 1.5 | 3.3 | 7.8 | 1.3 | 0.3 | 75 | 1.5 | 3.6 | ||||||||||||
| Bamskoye | 0 | 0.0 | 0 | 15 | 1.8 | 0.9 | 5.1 | 1.6 | 0.3 | 20 | 1.8 | 1.1 | ||||||||||||
| Medvezhy | 0 | 0.0 | 0 | 0 | 0.0 | 0 | 6.5 | 1.8 | 0.4 | 6.5 | 1.8 | 0.4 | ||||||||||||
| Total4 | 231 | 1.5 | 11 | 1, 596 | 1.7 | 88 | 1, 426 | 2.0 | 91 | 3, 111 | 1.9 | 190 | ||||||||||||
Competent persons
The Ore Reserve and Mineral Resource estimates are classified and reported according to the JORC Code reporting requirements. All material assumptions and technical parameters underpinning the estimates in the announcement have been reported previously, have not materially changed, and continue to apply.
The Competent Persons responsible for each estimate of Ore Reserves and Mineral Resources are:
- Mr Mark Chesher, AMC Principal Mining Engineer (Olimpiada open pit, Verninskoye, Chertovo Koryto, Kuranakh, Blagodatnoye, and Natalka Ore Reserve estimates).
- Mr Mikhail Satarov, Polyus Director of Department of Reserves and Operational Exploration (Titimukhta and Alluvials Ore Reserve estimates, Titimukhta, Alluvials, Panimba and Zmeinoye Mineral Resource Estimates. and all stockpile estimates).
- Mr Peter Cunningham, AMC Principal Mining Engineer (Olimpiada Underground Ore Reserve estimate).
- Mr Ingvar Kirchner, AMC, Principal Resource Geologist (Olimpiada, Blagodatnoye, Verninskoye, Kuranakh, Sukhoi Log, Poputninskoye, Chertovo Koryto, Bamskoye and Medvezhy Mineral resource estimates).
- Mr Mohan Srivastava, Micromine Consulting Services, Principal Consultant (Natalka Mineral Resource estimate).
All Competent Persons are Members of the Australasian Institute of Mining and Metallurgy, the Australian Institute of Geoscientists, or approved Recognized Professional Organisations, and have sufficient experience relevant to the style of mineralization and type of deposit under consideration and to the activity which is being undertaken to qualify as a Competent Persons as defined in the JORC Code.
In reporting the Mineral Resources and Ore Reserves referred to in this public release, AMC and Micromine acted as independent parties, have no interest in the outcomes of Polyus projects, and have no business relationship with Polyus other than undertaking those individual technical consulting assignments as engaged, and being paid according to standard per diem rates with reimbursement for out-of-pocket expenses. Therefore, AMC, Micromine and the Competent Persons believe that there is no conflict of interest in undertaking the assignments which are the subject of the statements.
Polyus
The Polyus group is the largest gold producer in Russia and one of the top 10 gold miners globally with the lowest cost position. Based on its 2017 Ore Reserves and Mineral Resources, the Polyus group ranks second by attributable gold reserves and gold resources among the world’s largest gold mining companies.
The Polyus group’s principal operations are located in Krasnoyarsk, Irkutsk and Magadan regions and the Sakha Republic (Yakutia).
Enquiries:
Investor contact
Victor Drozdov, Director Investor Relations
+7 (495) 641 33 77
drozdovvi@polyus.com
Media contact
Victoria Vasilyeva, Director Public Relations
+7 (495) 641 33 77
vasilevavs@polyus.com
Forward looking statements
This announcement may contain «forward-looking statements» concerning Polyus and/or Polyus group. Generally, the words “will”, “may”, “should”, “could”, “would”, “can”, “continue”, “opportunity”, “believes”, “expects”, “intends”, “anticipates”, “estimates” or similar expressions identify forward-looking statements. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Forward-looking statements include statements relating to future capital expenditures and business and management strategies and the expansion and growth of Polyus’ and/or Polyus group’s operations. Many of these risks and uncertainties relate to factors that are beyond Polyus’ and/or Polyus group’s ability to control or estimate precisely and therefore undue reliance should not be placed on such statements which speak only as at the date of this announcement. Polyus and/or any Polyus group company assumes no obligation in respect of, and does not intend to update, these forward-looking statements, except as required pursuant to applicable law.
1 using a gold price assumption of US$1,250/oz
2 the estimates for all deposits are presented on a 100% basis
3 for the Alluvials, cubic metres (m3) have been converted to tonnages using the general bulk density factor of 1,85 t/m3 strictly for the purpose of the summary accumulations. Gold grades have been adjusted from g/m3 to g/t accordingly. Contained gold estimates are not affected
4 any minor discrepancies for sums in the table are related to rounding
5 Sukhoi Log Mineral Resource estimate is as at 31 January 2017