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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Polymetal International Plc | LSE:POLY | London | Ordinary Share | JE00B6T5S470 | ORD NPV |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 215.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMPOLY
RNS Number : 7960M
Polymetal International PLC
18 October 2016
Release time IMMEDIATE Date 18 October 2016
Polymetal International plc
Q3 2016 production results
Polymetal International plc (LSE, MOEX: POLY; ADR: AUCOY) (together with its subsidiaries - "Polymetal", the "Company", or the "Group") is pleased to announce the Group's production results for the third quarter and nine months ended September 30, 2016.
HIGHLIGHTS
-- Polymetal produced 372 Koz of gold equivalent (GE) in Q3 2016, an increase of 29% quarter-on-quarter. The increase in production was driven by seasonal de-stockpiling at Mayskoye, launch of the Svetloye heap leach at Okhotsk operations, and a strong performance at Albazino and Varvara.
-- Year-on-year GE production dropped 5% as grades declined at Dukat and Omolon. Polymetal remains on track to deliver 1.26 Moz gold equivalent production for the year. We also re-iterate the cost guidance for the full year: TCC of US$ 525-575/GE oz and AISC of US$ 700-750/GE oz.
-- Polymetal generated significant free cash flow in the third quarter. Net debt remained essentially unchanged at US$ 1,469 million after the company paid US$ 38 million of interim dividends and spent US$ 100 million to acquire Komarovskoye.
-- At Kyzyl, construction activities are progressing on schedule. The amended subsoil contract, together with the program of work, received the final approval of the Kazakh government. The project remains on track to produce its first concentrate in Q3 2018.
-- At Svetloye, gold production commenced in August, delivering 15 Koz of gold during the quarter. Svetloye is currently running at 100% of design capacity and is set to become the key driver for sustaining production levels at the Okhotsk hub in the long term.
-- Polymetal regrettably reports a fatal incident at Svetloye on 8th October 2016. The Company will continue to implement additional measures to reinforce safety risk management procedures in order to fully eliminate fatalities at all of its operations.
-- Polymetal reconfirms its production guidance for 2017 at 1.4 Moz of GE and for 2018 at 1.55 Moz of GE.
-- Polymetal will be hosting an Analyst and Investor Day on November 14 in London to provide an update on key development projects.
"We remain firmly on track to meet our annual production and cost guidance. The commissioning of Svetloye, acquisition of Komar and successful integration of Kapan, are important milestones in our medium-term growth plans", said Vitaly Nesis, Group CEO of Polymetal, commenting on the results. "As originally expected, we delivered solid free cash flow for the quarter and remain strongly committed to shareholder returns."
Hot Features
Premium
3 months ended Sep 30, % change(1) 9 months ended Sep 30, % change(1)
------------------------- ----------------- ------------------------- -----------------
2016 2015 2016 2015
------------ ----------- ----------------- ------------ ----------- -----------------
Waste mined, Mt 23.9 17.2 +39% 58.2 50.0 +16%
Underground development,
km 24.6 18.1 +36% 68.3 54.0 +26%
Ore mined, Kt 3,462 3,116 +11% 9,194 9,124 +1%
Open-pit 2,405 2,360 +2% 6,448 6,855 -6%
Underground 1,057 755 +40% 2,746 2,269 +21%
Ore processed, Kt 3,306 2,852 +16% 8,593 8,289 +4%
Production
Gold, Koz 268 270 -1% 606 642 -6%
Silver, Moz 8.0 9.3 -14% 22.2 24.9 -11%
Copper, tonnes 311 670 -54% 1,266 808 +57%
Gold equivalent, Koz(2) 372 390 -5% 894 957 -7%
Sales
Gold, Koz 242 261 -7% 561 614 -9%
Silver, Moz 8.3 8.4 -2% 21.3 22.4 -5%
Copper, kt 0.3 - NA 0.5 0.7 -36%
Zinc, kt 1.4 - NA 1.5 - NA
Revenue, US$m(3) 466 402 +16% 1,059 1,050 +1%
Net debt, US$m(4) 1,469 1,435 +2% 1,469 1,298 +13%
Safety(5)
Fatalities - 2 -100% 2 5 -60%
LTIFR 0.19 0.19 - 0.18 0.21 -14%
Notes: (1) % changes can be different from zero even when absolute numbers are unchanged because
of rounding. Likewise, % changes can be equal to zero when absolute numbers differ due to
the same reason. This note applies to all tables in this release.
(2) Based on 1:80 Ag/Au, 5:1 Cu/Au and 2:1 Zn/Au conversion ratios.
(3) Calculated based on the unaudited consolidated management accounts. Concentrate sales
are recorded based on forward prices for the expected dates of final settlement and concentrate
revenue is presented net of refining and treatment charges.
(4) Non-IFRS measure based on unaudited consolidated management accounts. Net debt equals
to current and non-current borrowings less cash and cash equivalents and includes the liability
for dividend payable. Comparative information is presented for 30 June 2016 (for the three
months period) and 31 December 2015 (for the nine months period).
(5) LTIFR =lost time injury frequency rate per 200,000 hours worked.
(6) NA = not available, NM - not material
PRODUCTION BY MINE
3 months % 9 months %
ended Sep 30, change(1) ended Sep 30, change(1)
----------------- ----------- ----------------- -----------
2016 2015 2016 2015
-------- ------- ----------- -------- ------- -----------
GOLD EQ. (KOZ) (2)
Dukat 93 108 -14% 280 297 -6%
Albazino-Amursk 72 64 +13% 190 173 +10%
Mayskoye 47 71 -34% 68 91 -25%
Omolon 41 60 -32% 108 155 -30%
Voro 36 34 +7% 93 105 -11%
Varvara 22 20 +5% 57 58 -2%
Okhotsk 49 33 +49% 79 77 +2%
Kapan 12 - NA 18 - NA
-------------------- -------- ------- ----------- -------- ------- -----------
TOTAL 372 390 -5% 894 957 -7%
Notes: (1) % changes can be different from zero even when absolute numbers are unchanged because of rounding. Likewise, % changes can be equal to zero when absolute numbers differ due to the same reason. This note applies to all tables in this release.
(2) Based on 1:80 Ag/Au, 5:1 Cu/Au and 2:1 Zn/Au conversion ratios.
CONFERENCE CALL AND WEBCAST
Polymetal will hold a conference call and webcast on Tuesday, 18 October, 16:00 Moscow time (14:00 London time).
To participate in the call, please dial:
8 10 800 204 140 11 access code 95884697# (free from Russia), or
+44 (0) 20 3367 9462 (free from the UK), or
+1 855 402 7761 (free from the US), or
Any of the above numbers (from outside the UK, the US and Russia) or follow the link: http://www.audio-webcast.com/cgi-bin/visitors.ssp?fn=visitor&id=4019
Please be prepared to introduce yourself to the moderator or register.
Webcast replay will be available on Polymetal's website (www.polymetalinternational.com) and at http://www.audio-webcast.com/cgi-bin/visitors.ssp?fn=visitor&id=4019. A recording of the call will be available immediately after the call at +44 20 3367 9460 (from within the UK), +1 87 7642 3018 (from within the US) and +7 495 745 7948 (from within Russia), access code 304009#, from 16:30 Moscow time Tuesday, October 18 , till 16:30 Moscow time Tuesday, October 25, 2016.
Enquiries
Media Investor Relations
---------------- ----------------- ----------------------------------------------------
FTI Consulting +44 20 3727 1000 Polymetal ir@polymetalinternational.com
Leonid Fink Maxim Nazimok
Jenny Payne Evgenia Onuschenko +7 812 313 5964 (Russia)
Maryana Nesis +44 20 7016 9503 (UK)
---------------- ----------------- -------------------- ------------------------------
Joint Corporate Brokers
----------------------------------- ----------------------------------------------------
Morgan Stanley RBC Europe Limited
Sam McLennan Tristan Lovegrove
Richard Brown +44 20 7425 8000 Marcus Jackson +44 20 7653 4000
---------------- ----------------- -------------------- ------------------------------
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", "INTS", "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
DUKAT OPERATIONS
3 months ended Sep 30, % change 9 months ended Sep 30, % change
------------------------- --------- ------------------------- ---------
2016 2015 2016 2015
------------ ----------- --------- ------------ ----------- ---------
MINING
Dukat
Underground development, m 8,928 8,218 +9% 26,514 26,248 +1%
Ore mined (underground), Kt 409 434 -6% 1,211 1,228 -1%
Goltsovoye
Underground development, m 1,449 1,996 -27% 4,712 5,615 -16%
Ore mined (underground), Kt 48 40 +21% 141 151 -7%
Lunnoye + Arylakh
Underground development, m 1,407 1,478 -5% 3,952 4,188 -6%
Ore mined (underground), Kt 104 106 -3% 314 293 +7%
PROCESSING
Dukat
Ore processed, Kt 474 484 -2% 1,458 1,363 +7%
Head grades
Gold, g/t 0.7 0.7 -3% 0.6 0.6 -7%
Silver, g/t 386 477 -19% 374 467 -20%
Recovery(1)
Gold 87.1% 84.2% +3% 86.3% 84.4% +2%
Silver 85.6% 86.4% -1% 85.2% 85.8% -1%
Production
Gold, Koz 9.2 9.3 -2% 23.9 23.1 +4%
Silver, Moz 4.9 6.3 -22% 14.8 17.0 -13%
Lunnoye
Ore processed, Kt 107 101 +6% 325 311 +4%
Head grades
Gold, g/t 1.4 1.4 +2% 1.5 1.5 +3%
Silver, g/t 465 418 +11% 463 426 +9%
Recovery(1)
Gold 91.9% 92.3% -0% 92.4% 90.7% +2%
Silver 91.0% 89.7% +1% 92.0% 88.9% +3%
Production
Gold, Koz 4.5 4.4 +2% 15.2 13.9 +9%
Silver, Moz 1.5 1.2 +17% 4.5 3.8 +17%
TOTAL PRODUCTION
Gold, Koz 13.6 13.7 -0% 39.1 37.0 +6%
Silver, Moz 6.4 7.6 -16% 19.3 20.8 -7%
Note: (1) Technological recovery, includes gold and silver within work-in-progress inventory (concentrate, precipitate)
Year-on-year silver production fell by 16%, driven mostly by a normalisation of the grade profile at the Dukat underground mine, which produced exceptionally high grades last year. The Dukat concentrator continues to operate significantly above nameplate throughput capacity, with additional tonnage sourced from historic low-grade stockpiles.
At Lunnoye, both grades and ore volumes mined were higher y-o-y and q-o-q, leading to a 17% increase in silver production for the quarter.
ALBAZINO-AMURSK
3 months ended Sep 30, % change 9 months ended Sep 30, % change
------------------------- --------- ------------------------- ---------
2016 2015 2016 2015
------------ ----------- --------- ------------ ----------- ---------
MINING
Waste mined, Kt 5,226 4,576 +14% 13,845 12,715 +9%
Underground development, m 1,447 1,310 +10% 4,379 3,514 +25%
Ore mined, Kt 482 389 +24% 1,367 1,119 +22%
Open-pit 409 389 +5% 1,163 1,119 +4%
Underground 72 - NA 205 - NA
PROCESSING
Albazino concentrator
Ore processed, Kt 409 388 +5% 1,239 1,191 +4%
Gold head grade, g/t 5.1 5.5 -7% 5.1 5.3 -4%
Gold recovery(1) 88.0% 86.0% +2% 87.0% 87.4% -0%
Concentrate produced, Kt 34.2 34.7 -1% 102.8 100.3 +2%
Concentrate gold grade, g/t 53.6 52.6 +2% 53.2 54.8 -3%
Gold in concentrate, Koz(2) 58.9 58.6 +1% 175.8 176.8 -1%
Amursk POX
Concentrate processed, Kt 43.9 41.9 +5% 117.1 115.4 +1%
Gold head grade, g/t 53.3 55.3 -4% 52.1 52.6 -1%
Recovery 94.1% 94.0% +0% 94.1% 94.1% +0%
Gold produced, Koz 71.9 63.8 +13% 189.9 173.4 +10%
TOTAL PRODUCTION
Gold, Koz 71.9 63.8 +13% 189.9 173.4 +10%
Notes: (1) To concentrate
(2) For information only; not considered as gold produced and therefore not reflected in the table representing total production. Included in total production upon completion of downstream processing at the Amursk POX
Q3 Albazino/Amursk gold production was up 13% year-on-year. Quarterly throughput at the POX plant increased by 5% year-on-year. The decline in grades at Albazino was more than compensated for by increased throughput and better recoveries at the concentrator.
Albazino underground mine productivity and dilution control continued to improve. Careful geotechnical management of ground conditions remains essential for further improvement in productivity and grades.
The POX debottlenecking project has been approved by the board of directors. The capacity of the POX facility is expected to increase by approximately 50% in terms of concentrate processed. The key additions to the equipment will comprise a second oxygen plant, an autoclave discharge thickener, press filters for thickener underflow and upgrades to heat recovery and water treatment sections.
The increase in POX capacity will enable Polymetal to retain approximately 50% of Kyzyl concentrate for in-house treatment as opposed to a 3rd party off-take and is expected to improve effective gold recovery from concentrate, as well as bring down processing and transportation costs. Polymetal plans to ramp up the debottlenecked POX plant to full expanded capacity in the second half of 2018, in time to take first feed from the Kyzyl concentrator.
MAYSKOYE
3 months ended Sep 30, % change 9 months ended Sep 30, % change
------------------------- --------- ------------------------- ---------
2016 2015 2016 2015
------------ ----------- --------- ------------- ---------- ---------
MINING
Underground development, m 4,800 3,446 +39% 14,832 9,440 +57%
Ore mined (underground), Kt 213 152 +40% 502 519 -3%
PROCESSING
Mayskoye concentrator
Ore processed, Kt 214 197 +9% 541 634 -15%
Gold head grade, g/t 5.1 5.3 -5% 5.4 6.8 -21%
Gold recovery(1) 87.1% 83.2% +5% 87.6% 86.0% +2%
Concentrate produced, Kt 18.7 17.6 +6% 51.6 63.0 -18%
Concentrate gold grade, g/t 50.5 49.1 +3% 49.8 58.8 -15%
Gold in concentrate, Koz(2) 30.3 27.8 +9% 82.6 119.2 -31%
Concentrate sold, Kt 29.7 29.7 -0% 29.7 29.7 -0%
Payable gold in concentrate sold, Koz 43.2 59.6 -28% 43.2 59.6 -28%
Amursk POX
Concentrate processed, Kt 2.0 4.1 -50% 13.7 16.8 -19%
Gold head grade, g/t 51.9 59.4 -12% 54.8 58.4 -6%
Recovery 94.0% 94.0% +0% 94.1% 94.1% +0%
Gold produced, Koz 4.1 11.5 -64% 25.0 31.8 -21%
TOTAL PRODUCTION
Gold, Koz 47.2 71.1 -34% 68.2 91.5 -25%
Notes: (1) To concentrate
(2) For information only; not considered as gold produced and therefore not reflected in the table representing total production. Included in total production upon sale to off-taker or internal downstream processing to saleable metal product.
For the 9 months, total gold production at Mayskoye decreased by 25% to 68 Koz year-on-year, mainly influenced by higher levels of dilution that led to grade declines in ore processed. The new mining method is making good progress as the amount of ore mined grew 27% quarter-on-quarter to 213 Kt. The focus is now on achieving rapid backfill to ensure lower dilution from secondary stopes and reduced primary stope length.
OMOLON
3 months ended Sep 30, % change 9 months ended Sep 30, % change
------------------------- --------- ------------------------- ---------
2016 2015 2016 2015
------------ ----------- --------- ------------ ----------- ---------
MINING
Dalneye
Waste mined, Kt - - NA - 1,042 -100%
Ore mined (open pit), Kt - - NA - 635 -100%
Tsokol
Waste mined, Kt - - NA - 396 -100%
Underground development, m 1,022 684 +49% 2,954 785 +276%
Ore mined (open pit), Kt - - NA - 176 -100%
Ore mined (underground), Kt 41 - NA 70 - NA
Birkachan
Waste mined, Kt 792 777 +2% 2,174 1,447 +50%
Underground development, m 869 - NA 1,574 1,254 +26%
Ore mined (open pit), Kt 230 256 -10% 589 441 +34%
Ore mined (underground), Kt 23 - NA 27 1 NM
Oroch
Waste mined, Kt 1,178 1,127 +4% 4,085 2,628 +55%
Ore mined (open pit), Kt 282 195 +45% 691 232 +198%
Olcha
Waste mined, Kt 288 - NA 288 - NA
Ore mined (open pit), Kt 40 - NA 40 - NA
TOTAL HUB
Waste mined, Kt 2,257 1,904 +19% 6,546 5,515 +19%
Underground development, m 1,891 684 +176% 4,528 2,039 +122%
Ore mined, Kt 617 451 +37% 1,417 1,485 -5%
Open-pit 553 451 +23% 1,320 1,484 -11%
Underground 64 - NA 97 1 NM
PROCESSING
Kubaka Mill
Ore processed, Kt 212 207 +2% 629 622 +1%
Grade
Gold, g/t 4.3 6.3 -31% 4.6 6.1 -24%
Silver, g/t 182 227 -20% 110 184 -40%
Recovery(1)
Gold 92.5% 94.6% -2% 90.7% 95.6% -5%
Silver 91.3% 88.3% +3% 86.2% 87.4% -1%
Gold production, Koz 27.4 41.8 -34% 85.7 115.3 -26%
Silver production, Moz 1.1 1.5 -26% 1.8 3.1 -42%
TOTAL PRODUCTION
Gold, Koz 27.4 41.8 -34% 85.7 115.4 -26%
Silver, Moz 1.1 1.5 -26% 1.8 3.1 -42%
Note: (1) Technological recovery, includes gold and silver within work-in-progress inventory
For the 9 months, gold and silver production at Omolon decreased year-on-year by 26% and 42% respectively, as high-grade ore from Sopka was replaced by Dalneye stockpiles and ore from Oroch.
Open-pit mining at Olcha commenced in August. The objective is to truck approximately 150 Kt of ore to the Kubaka plant in Q1 2017, which should result in higher grades and production levels.
Underground mining at Tsokol and Birkachan has been making good progress with a total increase of 176% year-on-year.
VORO
3 months ended Sep 30, % change 9 months ended Sep 30, % change
------------------------- --------- ------------------------- ---------
2016 2015 2016 2015
------------ ----------- --------- ------------ ----------- ---------
MINING
Voro
Waste mined, Kt 2,679 2,636 +2% 7,993 7,818 +2%
Ore mined (open pit), Kt 353 506 -30% 986 1,422 -31%
* primary 237 379 -37% 775 1,086 -29%
* oxidised 115 127 -9% 211 336 -37%
PROCESSING
Voro Heap Leach
Ore stacked, Kt 232 243 -5% 295 423 -30%
Gold head grade, g/t 1.7 1.9 -10% 1.2 1.8 -32%
Gold production, Koz 6.7 8.3 -19% 12.2 19.2 -36%
Voro CIP
Ore processed, Kt 252 243 +4% 750 698 +8%
Gold head grade, g/t 4.3 4.0 +8% 4.3 4.1 +6%
Gold recovery(1) 78.3% 79.2% -1% 78.4% 78.8% -1%
Gold production, Koz 29.4 25.5 +15% 80.2 84.8 -5%
TOTAL PRODUCTION
Gold, Koz 36.1 33.8 +7% 92.4 104.0 -11%
Note: (1) Technological recovery, includes gold within work-in-progress inventory
Quarterly gold production at Voro increased by 7% year-on-year to 36.1 Koz, driven by improved head grades and ore volumes processed at the CIP plant.
VARVARA
3 months ended Sep 30, % change 9 months ended Sep 30, % change
------------------------- --------- ------------------------- ---------
2016 2015 2016 2015
------------ ----------- --------- ------------ ----------- ---------
MINING
Varvara
Waste mined, Kt 4,866 8,051 -40% 14,320 22,471 -36%
Ore mined (open pit), Kt 701 1,014 -31% 1,937 2,546 -24%
* float ore 15 21 -30% 44 118 -63%
* leach ore 686 992 -31% 1,894 2,428 -22%
Komarovskoye(2)
Waste mined, Kt 1,109 - NA 1,109 - NA
Ore mined (open pit), Kt 65 - NA 65 - NA
PROCESSING Flotation Ore processed, Kt 1 234 -100% 355 311 +14% Grade Gold, g/t 3.6 1.2 +203% 1.3 1.1 +16% Copper 0.29% 0.39% -24% 0.33% 0.36% -8% Recovery(1) Gold 93.1% 48.1% +94% 70.4% 46.2% +52% Copper 72.8% 72.3% +1% 72.6% 72.2% +0% Production Gold (in concentrate), Koz 0.5 3.3 -87% 7.0 4.1 +71% Copper (in concentrate), t 20 670 -97% 836 808 +4% Leaching Ore processed, Kt 731 594 +23% 1,954 2,265 -14% Gold head grade, g/t 1.1 0.9 +28% 0.9 0.8 +5% Gold recovery(1) 82.1% 76.8% +7% 78.0% 78.1% -0% Gold production (in dore), Koz 21.0 13.7 +53% 45.8 50.0 -8% Total ore processed, Kt 732 828 -12% 2,310 2,576 -10% TOTAL PRODUCTION Gold, Koz 21.4 17.1 +25% 52.8 54.1 -2% Copper, t 20 670 -97% 836 808 +4% Note: (1) Technological recovery, includes gold and copper within work-in-progress inventory
(2) Since the acquisition date (1 August 2016)
Quarterly Varvara gold production increased 25% year-on-year, mostly driven by improved grades and recovery levels at the leaching circuit.
Meanwhile, open-pit mining at Komarovskoye is ramping up with the first 30 Kt of ore railed to Varvara for processing. Grade levels and ore tonnage are expected to improve once mining catches up with the historic stripping backlog.
OKHOTSK OPERATIONS
3 months ended Sep 30, % change 9 months ended Sep 30, % change
------------------------- --------- ------------------------- ---------
2016 2015 2016 2015
------------ ----------- --------- ------------ ----------- ---------
MINING
Khakanja
Waste mined, Kt - 529 -100% - 1,478 -100%
Ore mined (open-pit), Kt - 104 -100% - 180 -100%
Ozerny
Underground development, m - - NA - 42 -100%
Ore mined (underground), Kt - - NA - 105 -100%
Avlayakan
Underground development, m 1,107 985 +12% 3,438 2,990 +15%
Ore mined (underground), Kt 34 22 +49% 94 78 +21%
Svetloye
Waste mined, Kt 259 - NA 764 - NA
Ore mined (open pit), Kt 324 - NA 976 - NA
TOTAL HUB
Waste mined, Kt 259 - NA 764 1,520 -50%
Ore mined, Kt 357 22 NM 1,070 363 +195%
Open-pit 324 - NA 976 285 +242%
Underground 34 22 +49% 94 78 +21%
PROCESSING
Khakanja
Ore processed, Kt 157 161 -3% 466 471 -1%
Grade
Gold, g/t 6.2 6.0 +5% 3.8 4.6 -18%
Silver, g/t 94 73 +28% 76 84 -10%
Recovery(1)
Gold 95.8% 94.9% +1% 95.5% 94.9% +1%
Silver 82.6% 75.7% +9% 77.2% 70.0% +10%
Gold production, Koz 29.2 28.9 +1% 53.2 66.2 -20%
Silver production, Moz 0.4 0.3 +32% 0.9 0.9 -2%
Svetloye Heap Leach
Ore stacked, Kt 401 - NA 401 - NA
Gold head grade, g/t 3.7 - NA 3.7 - NA
Gold production, Koz 14.7 - NA 14.7 - NA
TOTAL PRODUCTION
Gold, Koz 43.9 28.9 +52% 67.9 66.2 +2%
Silver, Moz 0.4 0.3 +32% 0.9 0.9 -2%
Note: (1) Technological recovery, includes gold and silver within work-in-progress inventory (precipitate)
Gold and silver production at the Khakanja plant in Q3 2016 increased year-on-year by 1% and 32%, respectively. This is mainly due to higher-grade ore with better metallurgical properties shipped from the Avlayakan mine
At Svetloye, production commenced on 15 August 2016 and is fully in line with the accelerated commissioning schedule. The heap leaching facility is currently running at 100% of its design capacity with all key parameters in line with plan.
KAPAN
3 months ended Sep 30 (1) , % change 9 months ended Sep 30(1) , % change
------------------------------ --------- ----------------------------- ---------
2016 2015 2016 2015
---------------- ------------ --------- --------------- ------------ ---------
MINING
Kapan
Underground development, m 3,537 - NA 5,938 - NA
Ore mined (underground), Kt 112 - NA 181 - NA
PROCESSING
Ore processed, Kt 116 - NA 180 - NA
Grade
Gold, g/t 2.3 - NA 2.3 - NA
Silver, g/t 47 NA 46 NA
Copper, % 0.3% - NA 0.3% - NA
Zinc, % 1.6% NA 1.6% NA
Recovery
Gold 85.8% - NA 85.2% - NA
Silver 83.8% NA 83.9% NA
Copper 91.7% - NA 91.9% - NA
Zinc 91.4% NA 91.3% NA
TOTAL PRODUCTION
Gold, Koz 6.5 - NA 9.9 - NA
Silver, Moz 0.1 - NA 0.2 - NA
Copper, kt 0.3 NA 0.4 NA
Zinc, kt 1.3 - NA 2.0 - NA
Note: (1) Since the acquisition date (28 April 2016)
At Kapan, integration activities and modifications to operating practices are ongoing and include changes to the motivation system, productivity gap analysis, as well as targeted in-fill drilling. The best practices from other underground operations in Polymetal's portfolio are being implemented by teams comprising local and seconded employees.
In-fill and step-out drilling is underway at Lichkvaz, a satellite deposit that should provide additional tonnage to the existing concentrator.
KYZYL PROJECT
3 months ended Sep 30, % change 9 months ended Sep 30, % change
------------------------- --------- ------------------------- ---------
2016 2015 2016 2015
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MINING
Waste mined, Kt 7,521 - NA 13,616 - NA
Open-pit mining (pre-stripping) aimed at removing historic waste stockpiles and the drill-and-blast excavation of fresh rock is running at full capacity and according to plan. Polymetal has signed the updated the subsoil contract and the program of work with Ministry of Industrial Development, which is an important milestone that ensures full compliance with the licensing regime.
Construction activities focused on foundations and structural steel for the processing plant building are progressing on schedule.
HEALTH AND SAFETY
Polymetal regrets to report a fatal incident at the Svetloye mine on 8th October 2016 as a result of a road accident. We are deeply saddened over the loss of our colleague.
Safe operations remain a top priority for Polymetal. We are taking all possible steps to reduce the risk of injuries in our business and are making sure that we provide a safe operating environment for all our employees throughout the Group.
PERSONNEL
Boris Balykov (39) has been appointed as the Managing Director at Voro.
Mr. Balykov has been with Polymetal since 2011, first joining as the deputy head of the Sopka open pit at Omolon. In January 2012, he moved to Kubaka as the deputy operations manager, and in October 2012 was promoted to operations manager. Before joining Polymetal, Mr Balykov worked at the Sokolov-Sarbay iron ore mine where he started as an assistant to the excavator operator and then worked as the production department manager, deputy head of the production department and finally, working his way up to Deputy Director. Mr Balykov graduated from the Rudny Industrial Institute as a mining engineer, specializing in open-pit development of mineral deposits.
Mr. Andrey Novikov (45), the previous Managing Director of Voro will now lead the Urals regional management team directing and coordinating all Polymetal's activities in the area including the Voro and Varvara mines.
This information is provided by RNS
The company news service from the London Stock Exchange
END
QRTFFDSIAFMSEIS
(END) Dow Jones Newswires
October 18, 2016 02:00 ET (06:00 GMT)
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