Polymetal: Prognoz fast-track development approval (1228968)
August 26 2021 - 2:02AM
UK Regulatory
Polymetal International plc (POLY) Polymetal: Prognoz fast-track
development approval 26-Aug-2021 / 09:02 MSK Dissemination of a
Regulatory Announcement, transmitted by EQS Group. The issuer is
solely responsible for the content of this announcement.
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Release time IMMEDIATE LSE, MOEX, AIX: POLY / ADR: AUCOY
Date 26 August 2021 Polymetal International plc
Prognoz fast-track development approval
Polymetal announces that the Board of Directors has approved an
accelerated development of the open-pit mine at Prognoz with ore
processing at the Nezhda concentrator. First payable concentrate
production is expected in Q3 2023.
"The decision to process ore from Prognoz at Nezhda ensures
optimal allocation of human and financial capital within Polymetal.
Fast-track development significantly reduces CAPEX requirements and
project execution risks, while bringing cash flows forward and
lowering environmental footprint", said Vitaly Nesis, Group CEO of
Polymetal.
PROJECT HIGHLIGHTS
-- Conventional open-pit mining will commence with pre-stripping
in Q3 2022, with first ore mined in Q12023. The annual mine
capacity will amount to 250 Kt of ore with average grade of
approximately 600 g/t silver(Ag).
-- Ore will be processed through the 2.2 Nezhda concentrator. Ag
recovery to high-grade clean silver-leadconcentrate is expected to
average 89%. Ore will be trucked by winter road from Prognoz to
Nezhda production site(675 km) using contractors.
-- LOM payable Ag equivalent (AgEq) in concentrate is expected
to comprise 120 Moz. Average annual payableAgEq production in
2023-2041 is estimated at roughly 6.5 Moz with an average AISC of
USUSD 13.8/AgEq oz.
-- The project's upfront CAPEX to be incurred is estimated at
USUSD 105 million comprising USUSD 20 millionspending in 2021 for
engineering and mine preparation and USUSD 85 million in 2022-2024,
which includes investment inmining fleet, remote site
infrastructure, roads, and pre-stripping.
-- Project NPV[1] and IRR stand at USUSD 154 million and 35%
respectively at USUSD 20/oz silver price rising toUSUSD 323 million
and 60% at USUSD 25/oz price.
RATIONALE BEHIND PROCESSING AT NEZHDA RATHER THAN BUILIDING
PROCESSING FACILITY ON SITE
-- Moving first payable production at least three years earlier
enabling Polymetal to benefit from thefavorable silver market.
-- Reducing project execution risks given remote location, harsh
climate conditions, and likely acutedeficit of personnel and
contractors during the construction stage.
-- Lowering initial CAPEX while maintaining attractive unit cash
costs and thus driving higher returns andfaster free cash
flows.
-- Materially reducing environmental footprint: 20% lower GHG
intensity due to grid connection at Nezhda,50% lower fresh water
intensity.
About Polymetal
Polymetal International plc (together with its subsidiaries -
"Polymetal", the "Company", or the "Group") is a top-10 global gold
producer and top-5 global silver producer with assets in Russia and
Kazakhstan. The Company combines strong growth with a robust
dividend yield.
Enquiries
Media Investor Relations
Polymetal ir@polymetalinternational.com
FTI Consulting
Evgeny Monakhov +44 20 7887 1475 (UK)
Leonid Fink +44 20 3727 1000
Timofey Kulakov
Viktor Pomichal
Kirill Kuznetsov +7 812 334 3666 (Russia)
Joint Corporate Brokers
Morgan Stanley & Co. International plc +44 20 7425 8000
Andrew Foster
RBC Europe Limited
Richard Brown
Marcus Jackson +44 20 7653 4000
Panmure Gordon Jamil Miah
John Prior
+44 20 7886 2500
Rupert Dearden
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", "intends", "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.
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[1] At 10% WACC.
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ISIN: JE00B6T5S470
Category Code: MSCM
TIDM: POLY
LEI Code: 213800JKJ5HJWYS4GR61
OAM Categories: 3.1. Additional regulated information required to be disclosed under the laws of a Member State
Sequence No.: 120783
EQS News ID: 1228968
End of Announcement EQS News Service
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