In the light of recent developments, and in the interests of preserving shareholder value, the Board and the Special Committee have decided to consider all possible options available for divestment of JSC Polymetal and its subsidiaries.
|Location||Khabarovsk Region, Russia|
|Operating Mines||Albazino, Kutyn|
|Key exploration projects||Kutyn, Urkachik, Syran|
|Processing||1.8 Mtpa flotation + POX and CIL processing at Amursk,
1.3 Mtpa heap leach/Merrill-Crowe at Kutyn
|Ore reserves (JORC)||2.0 Moz GE, 3.5 g/t average grade|
|Mineral resources (JORC)||3.5 Moz GE, 4.3 g/t average grade|
|Production start date||2009|
|Life of mine||2041|
Albazino, acquired in 2006, is a high-grade refractory gold mine developed as a Greenfield project by Polymetal. Today, it comprises an operating open-pit mine and a 1.6 Mtpa on-site flotation concentrator that was first launched in 2011. Albazino is an integral part of the group’s largest project — the Amursk POX Hub, where Albazino gold concentrate is transported and then processed into dore bars.
Polymetal acquired the deposit in 2011. During the extensive exploration campaign from 2012 through 2014, the Company discovered near-surface heap leachable mineralisation including the extensions of known ore bodies. The exploration campaign was recommenced in 2017. The updated JORC-compliant open-pit Ore Reserves estimate as at 1 October 2019 represents a 110% increase in gold contained in comparison with the previous reserve estimate. The asset also has potential for a long mine life as a part of the Albazino hub. In 2020 the Board of Directors has approved construction of the US$ 80 million Kutyn project. The Company subsequently spent US$ 55 million on exploration and site infrastructure in 2012-1H 2020.
Ore will be processed through the 1.1 Mtpa heap leach facility followed by the Merrill-Crowe process. Average LOM gold recovery is 71%. LOM gold production is expected to comprise 575 Koz.
At Albazino, ore processed at the Albazino concentrator increased by 4% to 1,843 Kt, above nameplate capacity. Full-year production declined by 8% to 229 Koz of gold as the largest high-grade Anfisa open-pit was fully depleted.
This was largely offset due to the contribution from the recently launched Kutyn heap leach, which contributed 52 Koz of gold into the total production. Full heap-leach processing capacity of 1.3 Mtpa of ore will be reached in 2023. Average annual output from 2023 to 2030 will be approximately 100 Koz of gold with an average AISC of approximately $950/oz.
Accelerated development was made possible by effective planning, tight project management and creative approaches to emerging supply chain issues.
- Construction of a grid power line to the Albazino production site
- Construction of the tailing storage facility #2.
- At the Talgiy section of the Urkachik area, the JORCcompliant mineral resource estimate was completed and amounted to 960 Koz of gold at an average grade of 3.7.
- At Kutyn, additional mineral resources increased to 663 Koz (414 in 2021).
- More than 60% of heat consumption now comes from heat recovery system
- 88% of water used on site is in a closed cycle or treated waste water
- Renovation of collecting ponds to improve the treatment of discharged water in 2022.
- Achieving full heap-leach processing capacity at Kutyn
- Winter road and additional heap-leach pads construction at Kutyn
- Construction of the power line linking Albazino to the grid.
The Albazino area has been a site of active placer gold mining since the 1890s, with first hard-rock gold discovered during prospecting activities in 1955. However, exploration activities were quickly suspended once the refractory nature of gold mineralisation was revealed.
Polymetal acquired Albazino in 2006 from a local placer miner for US$ 7 million, making it the Group’s first greenfield project since 2004. Active exploration on site commenced in 2007, and the first JORC reserves estimate was confirmed by a feasibility study in the second quarter of 2008. The same study also confirmed that the Albazino project can be economically developed as an open-pit operation with a 1.6 Mtpa conventional flotation plant and a pressure oxidation facility. Construction of the Albazino concentrator started in the third quarter of 2008 and was successfully launched with the first gold concentrate bagged in April of 2011. The same year, first concentrate shipments were made to third-party off-takers in China while the Amursk POX facility was under construction.
From the moment of its acquisition to the launch of production, a total of US$ 342 million was spent at Albazino comprising exploration, project capex, ongoing overhead, and first-fill working capital.
The Albazino deposit consists of several seemingly isolated northwest-trending mineralisation zones separated by fatult-bounded structural blocks. Mineralisation extends over 7 km in length with the Anfisa, Olga, Ekaterina and Farida zones in the northeast, and Nadezhda in the northwest.
Gold mineralisation at Albazino is of the low-sulphide, gold-pyrite-arsenopyrite type, and is associated with moderately dipping dykes that crosscut sandstrones. The most intense gold mineralisation is associated with fold zones, averaging between 10 and 30m in thickness with intense veining.
Kutyn deposit is located in the north-western margin of the Ulbanskaya geosyncline zone and refers to the Kutyn gold-bearing node. The area comprises Lower Jurassic terrigenous deposits of the Kutynskaya and Algatinskaya strata, the Lower Cretaceous andesitic volcanics, and subvolcanic and plutonic formations of the Later Cretaceous Ulbanskaya volcanic zone. Subvolcanic formations are represented by mafic-felsic dykes.
The deposit has favourable geological structure with mineralisation associated with carbonate-sericite-quartz metasomatic bodies with sulphide-quartz veins, similar to the multi-million ounce Albazino deposit.
To date, 10 zones of mineralisation have been identified extending for up to 2 km along strike. The zones of mineralisation are represented by several subparallel lenses with the average ore body thickness of 4 m.
Albazino is mined by conventional open-pit truck-shovel and drill-and-blast methods. The current life-of-mine plan provides for open-pit mining until 2034, with further extensions anticipated as a result of pit enlargement and additional exploration activities.
Albazino ore is refractory, with the majority of gold intimately associated with arsenopyrite and pyrite in microscopic and sub-microscopic form. As such, it is not amenable to recovery by conventional cyanidation. The zone of oxidised and transitional ore is developed to a maximum depth of 40 m.
Here, the run-of-mine ore is fed to the primary jaw crusher and reduced to 250 mm which is then subject to three-stage milling (in one SAG mill and two ball mills) followed by two-stage conventional flotation in parallel circuits. The flotation concentrate is then thickened, filtered, dried, bagged and shipped to the Amursk POX facility for further processing, while the flotation tails are thickened and sent to the valley-fill tailings storage that is lined with an impoundment dam.
The Albazino concentrator has been running at its full 1,600 ktpa design capacity since its launch in 2011. The bench scale autoclaving test work on the Albazino concentrate was carried out at SGS in Canada and achieved CIL gold recoveries from oxidised concentrate as high as 96%. An extended pilot plant run achieved a cyanide leach gold recovery of 95 per cent by CIL treatment of the POX discharge.
|Ore Reserves||Tonnage, Mt||Gold grade, g/t||Silver grade, g/t||Copper grade, %||GE grade, g/t||Gold, Koz||Silver, Moz||Copper, Kt||GE, Koz|
|Mineral Resources||Tonnage, Mt||Gold grade, g/t||Silver grade, g/t||Copper grade, %||GE grade, g/t||Gold, Koz||Silver, Moz||Copper, Kt||GE, Koz|