Eurasia Mining PLC Semenovsky Tailings Project (1081I)

TIDMEUA

RNS Number : 1081I

Eurasia Mining PLC

15 June 2017

Eurasia Mining plc (AIM: EUA)

("Eurasia" or the "Company")

Semenovsky Tailings Project - Extension of Agreement

Eurasia Mining plc, the Russia focused Platinum, PGM and gold production and development company, is pleased to announce an extension to the Heads of Terms agreement with OOO Metallurg Complect, over the Semenovsky Tailings Project ("STP"). Eurasia's exclusive right to acquire up to 67per cent of the project has now been extended to end of August 2017. This timeline ensures sufficient time for Eurasia to continue its development program at Semenovsky, ahead of making a final decision on participation.

Background to the Semenovsky project and metallurgy

Eurasia's initial agreement with Metallurg Complect was executed on 16 November 2015. Throughout 2016 Eurasia has made significant progress in developing the project towards mining. Eurasia contracted the writing of a feasibility study and reserves report and achieved approval of these reserves in August 2016.

The maiden reserves at the project were approved as 2.99 million tonnes of ore grading 1.18 grams per tonne ("g/t") of gold and 16.44 g/t of silver, with contained metal calculated as 3.5 tonnes of gold and 49.3 tonnes of silver (see RNS dated 31 August 2016 for full details of these results).

Subsequently, Eurasia undertook a metallurgical testing program to further clarify the best process by which to recover gold and silver from these mine tailings. Ultimately it was found that a 'low-tech' circuit liberating 40per cent of gold in cyanide leach tanks, and recovering gold from solution using a manufactured resin was found to present robust economics (see RNS dated 22 December 2016)

Internal calculations undertaken by Eurasia on STP indicate an 8.5-year mine life, producing an average of 4,938 ounces of gold and 682,000 ounces of silver per annum and generating total revenues of $57 million at a gold price of $1,135 per ounce (December 2016 prices). Eurasia has estimated that free cashflow after allowing for processing costs, land rehabilitation and relevant taxation would total $33million or $3.8 million per annum. At a 10per cent discount rate Eurasia has estimated the project Net Present Value to be approximately $15million with a project Internal Rate of Return of approximately 54per cent. However, at this stage, there can be no guarantee that these results will be achieved.

Bulk testing program

A further option, which is now being costed and discussed in greater detail involves transport of a bulk sample to a nearby operating gold plant to test gold recovery at an industrial scale. This may be considered as the final due diligence exercise in de-risking the project ahead of a decision on whether to proceed to building the mine. This operation is now being costed by Company representatives who are visiting the proposed plant. The plant comprises crushing, grinding and leaching circuits, with subsequent recovery of gold from leach solutions via a Merill Crowe Machine. To replicate the proposed plant at Semenovsky it is proposed to bypass the initial crushing and grinding circuits, and deliver Semenovsky ore direct to the leaching circuit. An update will be provided on this work as and when information becomes available.

Christian Schaffalitzky, CEO of Eurasia commented:

"I am delighted that Eurasia's exclusive right to acquire up to 67 per cent of the Semenovsky Tailings Project has now been extended to end of August 2017 as this ensures sufficient space for the Company to continue its development program. I look forward to updating shareholders with our final decision on whether to participate in the coming months."

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/Michael de Villiers

[phone]

WH Ireland Limited

Katy Mitchell/James Sinclair-Ford

[phone]

Beaufort Securities

Elliot Hance

[phone]

Blytheweigh

Tim Blythe/Camilla Horsfall

[phone]

Notes to Editors

Eurasia Mining Plc is a Platinum Group Minerals ("PGM") production, development and exploration company with an exciting portfolio of assets in Russia. It commenced its first full season (May until late October) of production from its West Kytlim mine this year. It is also continuing to develop its asset portfolio, with the Monchetundra project now at Mining Licence application stage.

This information is provided by RNS

The company news service from the London Stock Exchange

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June 15, 2017 02:00 ET (06:00 GMT)