Polymetal Takes Full Control Of Tarutin Copper Deposit In Russia
LONDON (Alliance News) – Polymetal International PLC on Tuesday said it has taken full control of the Tarutinskoye copper deposit in the Celyabinsk region of Russia in an all-share deal worth USD10 million.
Polymetal already owned 75% of LLC Vostochny Basis, the company that holds the licence, and has now pushed that stake up to 100% after purchasing a 25% stake from Gerosena Trading Ltd.
In return for the 25% stake, Polymetal will pay USD10 million by issuing 893,575 new shares. Those new shares will represent about 0.2% of Polymetal’s enlarged issued share capital.
“Tarutin is a conventional copper-gold skarn deposit that is an excellent fit with Polymetal’s processing hub strategy. It is expected to provide an open-pittable and easily accessible ore feed for the Varvara flotation plant located in Kazakhstan, 150 kilometres by road from the mine site,” said Polymetal.
A reserve estimate should be published in the third quarter of 2017, with mining expected to commence in 2018. The aim is to get the project processing up to 300,000 tonnes of ore at Varvara to produce 4,000 to 5,000 tonnes of copper per year between 2018 and 2020.
The initial investment will be “less than” USD5 million, with Polymetal benefiting from its existing mine fleet by moving it to the project from its existing operations.
The current probable ore reserve estimate for Tarutin as at January 1, 2016, was 890,000 tonnes of ore graded at 0.1 gramme gold, 13 grammes silver, 3.3 grammes germanium per tonne of ore and 1.62% copper.
That means the probable estimate forecasts the deposit has about 3,000 ounces of gold, 359,000 ounces of silver, 14,400 tonnes of copper and 93,000 ounces of germanium.
“We have decided to consolidate 100% ownership over Tarutin as it is a natural close fit for our Varvara hub and enhances its copper reserve base,” said Vitaly Nesis, chief executive of Polymetal. “Tarutin is expected to start providing cash flows in the near term.”