Polymetal: Mineral Resources of Lichkvaz comprised of 4.3 Mt of ore averaging 4.2 g/t for 0.6 Moz of gold equivalent

The source says that total underground Mineral Resources in accordance with the 2012 JORC Code confirmed by independent auditors, CSA Global, comprised of 4.3 Mt of ore averaging 4.2 g/t for 0.6 Moz of gold equivalent. 

 

Lichkvaz is located in the Meghri area of the Syunik-Marz province of southern Armenia, 380 km south of Yerevan. The infrastructure in the area is well-developed with power, water, accommodation and a skilled labour force readily available. The main economic elements at the deposit are gold and copper, with silver considered a by-product.

 

Polymetal intends to transport ore mined at Lichkvaz 70 km to the Kapan concentrator for processing. The acquisition of the Kapan concentrator together with the underground mine and related infrastructure was completed by Polymetal on 28 April 2016 (details of the transaction were provided in the press releases dated 2 March and 28 April 2016).

 

"We are very pleased with the results of exploration and audit work at Lichkvaz. This is an important contribution towards our production expansion at the nearby Kapan concentrator", said Vitaly Nesis, Group CEO of Polymetal. "The asset displays consistently high grades and relatively simple geology while retaining further significant exploration potential".

 

Earlier, Polymetal International plc (together with its subsidiaries - "Polymetal", the "Company", or the "Group") announced that it increased its interest in the Lichkvaz property in Armenia to 100%. Polymetal purchased an additional 75% stake in the company holding 

Lichkvaz property in Armenia, and increased its ownership from 25% to 100%. The consideration comprises 1,084,853 Polymetal shares equal to US$9.7 million (0.26% of increased share capital). Details of the Transaction on the acquisition of a 25% stake can be found in the Company's announcement from 15 April 2015. The decision to increase 

the Company's interest to 100% was taken following successful results of exploration drilling performed during surveying season 2015. 

 

Drilling has been completed, with 15,800 metres drilled across 70 diamond drill holes. To date, samples taken from 20 drill holes have been analysed (representing c.25% of total number of samples). Based on the first data obtained, nine productive intersections have been discovered with the average grade of 6.4 g/t GE per average true width of 4.5 metres.  The Company plans to further analyse exploration data obtained during 2015 and to prepare a resource estimate (JORC compliant) for release in Q2 2016. Lichkvaz is located in the Meghri area of the Syunik-Marz province of southern Armenia, 380 km south of Yerevan.  The infrastructure in the area is developed with power, water, accommodation and skilled labour force available. 

 

To note, Iberian Resources Company owned Lichqvaz-Tey mine in the 90s. In 2008 Tamaya Resources (the company owns 82.6% of Iberian Resources' shares) Board of members announced about the shut- down of the gold-mining project implemented in the mine. According to company's estimation, the amortization costs appeared to be higher, and the gold reserves appeared to be smaller in Armenia.  According to Iberian Resources preliminary estimation, there are 17 tons of gold reserves in the mine.  The mine mineralization appeared to be more complex than expected. Tamaya Resources made a decision to stop the investments for Meghri mine requires a lot of funds. In 2009 the preliminary investment cost was 65 mln USD.

 

Polymetal is a leading gold and silver mining group, operating in Russia and Kazakhstan.  Company's shares are listed on London and Moscow Stock Exchanges.  Polymetal is a constituent of FTSE 250 and FTSE Gold mines. Polymetal was incorporated in Saint Petersburg in 1998 by CJSC ICT (now controlled by Mr. Alexander Nesis) with the 

goal of creating a Russian mining company that would use state-of-the- art technology from exploration to bullion production, and capitalise on opportunities to commercially develop the results of Soviet era exploration.  In November 2005, control over JSC Polymetal (a holding company of the Group) was acquired by OAO GNK Nafta Moskva (Cyprus) Limited and transferred in August 2006 to Nafta Moskva (Cyprus) Limited (both controlled by Mr. Suleiman Kerimov). In February 2007, JSC Polymetal held an initial public offering, as a result of which 24.4% of JSC Polymetal shares were placed to institutional investors. In conjunction with the initial public offering, the shares of JSC Polymetal were listed on the RTS and MICEX exchanges in Russia and the GDRs representing such shares were listed on the London Stock Exchange. In June 2008, an affiliate of Nafta Moskva (Cyprus) Limited sold all of its shares in JSC Polymetal (68%) to three parties: Powerboom Investments Limited, a Cypriot 

entity that is ultimately beneficially owned by Mr. Alexander Nesis (23.97%), the founding shareholder of the Company; Pearlmoon Limited, a Cypriot entity owned by PFF Group N.V., which is controlled by Mr.  Petr Kellner (24.82 %); and Vitalbond Limited, a Cypriot entity that 

is ultimately beneficially owned by Mr.  Alexander Mamut (19.02 %). Polymetal International plc was incorporated in Jersey in July 2010 to become the new holding company of JSC Polymetal and seek admission of its shares to the premium listing segment of the Official List and to trading on the main market of the London Stock Exchange.  On November 2, 2011 Polymetal International plc was admitted to trading on the Official List of the London Stock Exchange raising US$ 763m from the IPO.