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Petropavlovsk Plc (POG)

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Wednesday 03 November, 2010

Petropavlovsk Plc

Interim Management Statement

RNS Number : 5238V
Petropavlovsk PLC
03 November 2010
 



 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN, OR INTO, THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN

 

Production Report for Q3 2010 and Interim Management Statement

 

Petropavlovsk PLC ("Petropavlovsk" or the "Company", or together with its subsidiaries "the Group") today issues its interim management statement for the period from 1 July 2010 to date, in accordance with the UK Listing Authority's Disclosure and Transparency Rules. 

 

Highlights

Gold Production Report for Q3 2010


Total Attributable Production*


Q3 2010

Q3 2009

9m to

30 Sep 2010

9m to

30 Sep 2009


oz

oz

oz

oz

Pokrovskiy deposit

30,900

57,300

90,300

149,000

Pioneer deposit**

42,500

34,400

132,400

152,500

Malomir deposit

3,400

-

3,400

-

Omchak*** 

Alluvials (incl. Tokur)

40,300

15,500

20,100

10,800

48,700

21,800

27,000

16,200

Joint ventures





Odolgo 

5,700

1,000

8,000

1,500

TOTAL

138,300

123,600

304,600

346,200

 

* Total attributable gold production, as stated throughout this document, is comprised of 100% of production from the Group's subsidiaries and the relevant share of production from joint ventures and other investments. The Group has held a 1.1% interest in Rusoro Mining Ltd since March 2009; no attributable ounces are included in the Group figures. The Company's direct and indirect interest in Pokrovskiy Rudnik (and any interest held by Pokrovskiy Rudnik) is 98.61%. Cumulative gold production, as stated in this document, consists of gold physically recovered and gold in circuit.

 

**During the nine month period ended 30 September 2009, some of the ore from Pioneer deposit was processed through Pokrovskiy mill, yielding production of 9,500oz. Pioneer gold processed through the Pokrovskiy mill is included in the Pioneer deposit figures.

 

***Following the acquisition of 32.5% and 7.5% of the issued capital of the Omchak Joint Venture from OAO Susumanzoloto and OAO Shkolnoye respectively, production for Q3 2010 is 100% attributable to the Group. Production for Q3 2009 and nine months to 30 of September 2009 was 50% attributable to the Group.

 

Operations and Production Update

 

·     The Group's total attributable gold production for Q3 2010 was 138,300oz, an increase of c.37% on the Group's total attributable production for Q2 2010 and an increase of 12% on theGroup's total attributable production for Q3 2009.

 

·     The Group's total attributable gold production for the nine months ended 30 September 2010 decreased by 12% compared to the same period in 2009. The decrease was principally due to the scheduled fall in production from the maturing Pokrovskiy mine and lower grades processed at the Pioneer mine. This was significantly offset by a five-fold increase in the capacity of the RIP plant at Pioneer and the successful commissioning of the Malomir mine.

 

·     Production at Pioneer during Q3 2010 increased by 24% to 42,500oz compared to the same period in 2009, despite an 83% decrease in average head grades through the mill. 

 

·     The delay in the delivery of major mining equipment, in combination with the extremely harsh weather and the challenges of handling a significant increase in mining operations at the Pioneer mine, caused a 30% decrease in mining works during the first nine months of the year compared to the mining plan. This resulted in a shortfall of production during Q3 2010 and in forecast production for the full calendar year.  The Group did not have sufficient contingency in its mining plan for 2010 and a combination of several unforeseen external factors during the first nine months led to a deferral in the production schedule.

 

·    The high grade reserve at Pioneer which was scheduled for processing in Q4 2010, is now expected to contribute to the mine's future production schedule, thus improving the originally anticipated production profile. The Group anticipates that processing of the high-grade ore at the Pioneer mill that has been pushed back will commence only in December 2010 and will extend into 2011 and consequently will not be properly captured in the full year 2010 figures.

 

·    The Group's specialists remain confident in the long-term production potential of the existing asset base, especially in light of the ongoing positive exploration discoveries. 2010 is a transitional period in Pioneer's development as it evolves from a small-scale selective operation into a world class bulk tonnage operation and this evolution has naturally presented challenges for the team. With more equipment arriving on site the Group now expects Pioneer's performance to stabilise going forward.

 

·    The new Malomir mine was successfully commissioned and ramped up to its design capacity of 55,000 tonnes per month during Q3 2010. At start-up, initial grades proved low, although there has been improvement since. The initial production was adversely affected by lower grades of ore delivered to the mill, compared to what was originally scheduled. The situation improved in October when an average head grade of 4.75g/t was processed through the mill. The mine is working steadily and it is expected that an average grade of 6.2g/t will be processed through the mill until the end of the year.

 

·     Attributable production from Omchak in the nine months ended 30 September 2010 was 48,700oz.

 

·     In line with the Group's expectations, the Odolgo Joint Venture and the Group's alluvial operations contributed a further 29,800oz in the nine months ended 30 September 2010 (compared to 17,700oz in the same period in 2009).

 

•     The majority of difficulties which have arisen during this transitional year have now been successfully overcome by the Group, but in light of the factors mentioned above the Group now estimates that its 2010 full year gold production will be in the region of 510,000oz - 530,000oz.

 

Costs and Average Realised Gold Price

 

·     Total cash operating costs for the nine months ended 30 September 2010 were in line with the Group's expectations.

 

·     The average realised gold price for the Group during the nine months ended 30 September 2010 was US$1,190.

 

Exploration and Development

 

·     The commissioning of the second processing line at Malomir is currently on schedule for H2 2011, while the conversion of the plant to flotation / high pressure oxidation operations is currently on schedule for H2 2012.

 

·     Construction works at Albyn are currently on schedule for the plant's commissioning in Q4 2011.

 

·     Successful exploration works during 2010 are expected to yield a significant increase in the Group's reserves and resources. Further details of this work are expected to be released in March 2011.

 

Corporate Update

 

·     On 21 October 2010, the Group's Non-Precious Metals Division, IRC Limited ("IRC"), was listed on the Main Board of The Stock Exchange of Hong Kong Limited, with a market capitalisation of approximately US$780 million, at a final offer price of HK$1.80 per Offer Share. The listing raised gross proceeds of approximately US$241 million (assuming no exercise of the Over-allotment Option).Following the listing, Petropavlovsk continues to be the largest shareholder in IRC with an interest of 65.6%.

 

·     In August 2010, the Board of Directors of the Company declared an interim dividend of 3 pence per share. The dividend was paid on 29 October 2010 to shareholders on the register as at 1 October 2010.

 

Outlook for 2011                                                                                                       

 

·     Production guidance for 2011 will be announced on 27 January 2011.

 

·     The Group looks forward to a full year contribution from those assets brought into production in 2010.

 

·     The guidance for 2011 will take into account changes in the mining schedules for Pokrovskiy, Pioneer and Malomir during 2010 and significant exploration success, particularly at Pioneer, where a new high-grade ore reserve has been identified.

 

IRC Update

 

·     Iron ore concentrate from the Kuranakh project is being sold and transported to China via the crossing at Suifenhe.

 

·     Construction work at K&S is on target for initial start-up during 2013.

 

Commenting on the announcement, Peter Hambro, Chairman, said:

 

"The previously highlighted equipment delivery problems and the exceptional adverse weather created significant operational difficulties for the Group which were beyond our control. These were exacerbated by the challenges of moving from small-scale to large-scale mining and to multi-mine management and were far more difficult to manage than we had envisaged.

 

Because of our 16 years of experience on the ground, we continued to believe that we could overcome these difficulties in time to meet our production expectations; but are now aware that this is no longer feasible because not enough contingency was built into our plans for the year. For this reason our revised forecast production for 2010 is far short of the number that we originally predicted and, indeed, the reduced number we estimated as recently as August this year. 

 

This is disappointing for our team especially as there have been great successes in the period. Delivery of the much increased processing capacity at Pioneer, which has enabled us to produce almost the same amount of gold in the first nine months of 2010 as in the same period last year from grades that are 83% lower, is one of these successes. The commissioning of the Malomir mine on time and on budget is another.

 

Going forward we have taken a number of steps with a view to improving, through management changes, training and recruitment, our operational performance and, as a consequence, to obtaining more accurate forecasting. 

 

There can be no doubt that these developments, particularly when taken with the larger processing capacity at Pioneer and the higher grades to be available for processing, should stand us in good stead for 2011. The improving price of gold will also assist us.

 

We are also pleased to have successfully accomplished the listing on the Hong Kong Stock Exchange of our iron ore assets as "IRC", a company in which we have retained a 65.6% stake. Hong Kong is an increasingly popular home for mining capital and a suitable one for IRC as an industrial commodities company that is important for both Russia and China."

 

Conference Call Details

 

There will be a conference call today to discuss the announcement at 10:00 (GMT). Present on the conference call will be: Chairman, Mr. Peter Hambro, Chief Executive Officer, Dr. Pavel Maslovskiy, Chief Financial Officer, Mr Brian Egan and Group Head of Technical Services, Mr. Martin Smith.

 

Details to access the conference call are as follows:

 

The Dial-in number in the UK will be:             0800 694 0257

The Dial-in number is Russia will be:             8108 002 097 2044

The Dial-in number in the USA will be:           1 866 966 9439

Elsewhere, the Dial-in number will be:           +44 1452 555 566

 

The Conference ID in all cases will be:          22544247

 

Enquiries:

 

Petropavlovsk PLC

Alya Samokhvalova 

Rachel Tuft

 

 

 +44 (0) 20 7201 8900 

 

 

Merlin

David Simonson

  Fiona Crosswell

 

 +44 (0) 20 7726 8400 

Group Operations Report

 

2010 has to date been a very challenging period for the Group due to the scheduled commissioning of a new milling circuit at Pioneer and a new mine at Malomir, as well as the unexpected difficulties described below. Both launches were successfully carried out on schedule, notwithstanding the remote location of the Malomir site. The start-up of the Malomir mine and significant expansion at Pioneer have enabled a major increase in mining operations.

 

One of the biggest challenges in 2010 has been the dramatic increase in the volume of mining works carried out by the Group. During 2009, the total material moved at the Group's operations was 14.5 million m3; the mining schedule for 2010 for Pioneer alone provided for 27 million m3 of material to be moved (compared to 9.0 million m3 in 2009). The transition to a bulk tonnage operation required the use of much larger machinery which was timely ordered by the Group but whose delivery was seriously delayed by the supplier.

 

The necessity to reschedule mining works as a result of the delay, together with the necessity to develop several narrow pits at Pioneer, naturally presented a strong challenge for the Group's specialists. The Group did not anticipate these issues in its mining plan in 2010 and as a result was slow to address the effects of the inclement weather and delays in the delivery of large mining equipment that had a strong impact on production during the first nine months of 2010. 

 

Although the grade reconciliation between the pit and the plant at Pioneer mine was satisfactory, the delay in the stripping work at the high grade ore bodies resulted in the processing of lower grade ore from the mine and stockpiles, causing a significant shortfall in production compared to what was initially targeted. The high grade reserve which was scheduled for processing in Q4 2010 is now expected to contribute to the future production schedule for Pioneer, providing a smoother production profile than originally expected.

 

The newly commissioned Malomir mine, though successful on the processing side, also had to cope with operational mining difficulties during start-up, where the mining of a narrow ore body resulted in the production of lower grades than initially scheduled.

 

Going forward the Group has put in place a number of changes.

 

Management

 

A new Chief Manager of Mining Operations for the Group has been appointed and the management hierarchy at the Pioneer mine is currently being restructured. The restructuring is expected to be finalised by the end of the year.

 

Agreement has been reached with Liebherr and Caterpillar, suppliers of industrial scale mining equipment, on the training and certification of the Group's operating personnel.

 

Planning improvements

 

From June 2010, significant optimisation has been undertaken at Pioneer in the planning of mining works. The frequency of mining surveys was increased from once every fortnight to once every ten days. The Group's engineering design institute is currently working on the optimisation of mining schedules to take account of the large scale machinery used.

 

Technical measures

 

Improvements have been introduced into the planning and execution of dewatering works in the pits and in the preparation of explosive material for drilling and blasting at the Group's mines. A new plant for the production of explosive materials has been commissioned by the Group. The facility is expected to optimise drilling and blasting work carried out by the Group, enlarging productivity and reducing the cost of such work.

 

 

 

 

Group Operations Report: Pokrovskiy

 

The Pokrovskiy mine produced 90,300oz during the first nine months of 2010, including 30,900oz produced during Q3. The mining works at Pokrovskiy were complicated by the previously announced movements of the main pit's southern wall which was restored by a significant amount of stripping work initially scheduled for 2011 being accelerated into the first nine months of 2010. These mining works are expected to facilitate access to higher grades at Pokrovskiy's main ore body which deepens underneath the southern pit wall. During the first nine months of 2010, some lower grade material from the recently defined Pokrovka 2 ore body was processed through the mill. The current life of the mine is estimated to continue until the end of 2016 with the main pit scheduled to be depleted by the end of 2012. Some increase in reserves around the main pit is expected to be defined by the end of 2010. The increase in the gold price and consequent reduction in economic cut-off grade may also allow the Group to expand its gold reserves in the main pit.

 

Pokrovskiy Mining and Processing Operations

 

Pokrovskiy mining operations

 

Units

Q3 2010

Q3 2009

9 months to 30 Sep 2010

9 months to 30 Sep 2009

Total material moved

m³ '000

1,619

1,468

4,447

4,109

Ore mined

t '000

277

628

1,072

1,600

Average grade

g/t

1.5

2.4

2.0

2.7

Gold content

oz '000

13

49

69

137

Pokrovskiy processing operations

 

Units

Q3 2010

Q3 2009

9 months to 30 Sep 2010

9 months to 30 Sep 2009

Resin in Pulp Plant

Total milled

t '000

435

445

1,308

1,315

Average grade

g/t

1.9

4.1

2.2

4.1

Gold content

oz '000

27

59

92

175

Recovery rate

%

87.0

86.3

85.0

84.7

Gold recovered

oz '000

23.3

50.7

78.2

148.2

Heap Leach

Ore stacked

t '000

388

365

725

676

Average grade

g/t

1.0

0.9

0.9

0.9

Gold content

oz '000

12

11

22

19

Recovery rate

%

61.4

60.2

56.2

53.4

Gold recovered

oz '000

7.6

6.6

12.1

10.3

Total

Gold recovered

oz '000

30.9

57.3

90.3

158.5

Including

 

 

 

 

 

Pokrovskiy

oz '000

30.9

57.3

90.3

149.0

Pioneer

oz '000

-

-

-

9.5

 

 

 

Group Operations Report: Pioneer

 

The Pioneer mine produced 132,400oz of gold during the first nine months of the year, including 42,500oz in Q3 2010. During the nine months ended 30 September 2010, the Pioneer mine operations underwent a significant expansion which relied on the timely delivery of three new 15m3 excavators. The first excavator was delivered to the site two months late, whilst the second was delivered almost three months late. It is currently expected that the third excavator will be delivered in January 2011, following which the mining fleet will be complete. The delay both in the delivery of this equipment and in optimising bulk tonnage operations caused significant disruptions to the original mining schedule, which meant that the increased capacity of the plant was used to process lower grades of ore than scheduled.

 

Of the 18.8 million m3 of material scheduled to be mined during the first nine months of the year at Pioneer, only 13.3 million m3 were mined, representing a shortfall of almost 30% in mining works against the mining plan for this period. Although the Group managed to achieve a c.220% increase in mining works at Pioneer during the nine months ended 30 September, 1.9 million m3 in September 2010 compared to 0.85 million m3 in January 2010, the rate of increase and the grades of ore processed were insufficient to enable the Group's total production target to be achieved. Mining works were also significantly complicated by the geometry of high grade ore bodies, where large volumes of material needed to be moved from several narrow pits.

 

Notwithstanding the fact that the Group had already reviewed its mining plan in August 2010 to reflect delays in stripping works, further analysis of the mining work carried out in, and the production figures for, September and October established that it would be difficult for the Group to make up, by the year end, the shortfall in production by the end of Q3 2010. The stripping process is currently some 2 to 5 weeks behind schedule, a period which will affect the total production for the year since initially the treatment of high-grade ores from the Andreevskaya deposit was scheduled for Q4 2010.

 

Grade reconciliation demonstrated a very good correlation between reserve grades and gold production.

 

All these factors resulted in a reduction of gold production from the mill despite the increased processing capacity. Since Pioneer is the main contributor to the Group's production target for the year, this has resulted in the downward revision of the Group's 2010 production target.

 

On the positive side, during the first nine months of 2010, average grades processed through the mill at Pioneer reached 1.3g/t with a decrease in cash costs per tonne of ore processed. This performance highlights the long-term viability of Pioneer, a mine with significant established reserves of lower grade material with considerable potential for its use. The presence of high grade ore and potential transformation of high grade resources to reserves are expected to provide an additional enhancement to the mine's production schedule. Additionally, the processing of the high grade reserve which was scheduled for Q4 2010 has been deferred and is expected to contribute to Pioneer's future production schedule, thus providing a smoother production profile than originally anticipated.

 

Pioneer Mining and Processing Operations

 

Pioneer mining operations      

 

Units

Q3 2010

Q3 2009

9 months to 30 Sept 2010

9 months to 30 Sept 2009

Total material moved

m3 '000

5,630

2,617

13,337

6,120

Ore mined

t '000

776

414

2,482

813

Average grade

g/t

1.7

3.1

2.0

6.5

Gold

oz '000

42

42

159

171

Pioneer processing operations

 

Units

Q3 2010

Q3 2009

9 months to 30 Sept 2010

9 months to 30 Sept 2009

Resin in Pulp Plant

Total milled

t '000

1,165

191

2,825

512

Average grade

g/t

1.3

6.8

1.7

9.6

Gold content

oz '000

48

42

155

158

Recovery rate

%

83.8%

82.3

83.8

90.3

Gold Recovered

oz '000

40.2

34.4

130.1

143.0

Heap Leach

Ore stacked

t '000

211

-

211

-

Average grade

g/t

0.8

-

0.8

-

Gold content

oz '000

6

-

6

-

Recovery rate

%

39.6

-

39.6

-

Gold recovered

oz '000

2.3

-

2.3

-

Total

Gold recovered

oz '000

42.5

34.4

132.4

143.0

 

***In the H1 2009 Trading Update ore from pit should be read as ore from stockpile and ore from stockpile should be read as ore from pit.

 

Malomir Mining and Processing Operations

The successful commissioning of the Malomir mine on schedule and the plant's smooth ramping up to its design capacity proved to be a significant achievement for the Group. This achievement was even more remarkable due to the remote location of the deposit and the infrastructure difficulties which were successfully overcome. The initial results were, however, adversely affected by mining work difficulties and lower grades of ore processed.

 

During the ramp up period in September, as is usual practice, only low grades of 1.9g/t were processed through the mill to define technological parameters of the new plant. After a successful ramp up in October, the average grade processed through the mill has been 4.75g/t, which is c.50% lower than the 9.4g/t initially scheduled.

 

The high grade ore at the core of the Quarzitovoye deposit was diluted by the surrounding lower grade material due the narrow structure of the high-grade ore body at the upper levels of the Quarzitovoye deposit.

 

The work undertaken showed that in order to succeed in producing the scheduled ultra high grade ore, a 1.5 x 2m drilling grid was required, but that this scenario is not economically viable and hence the decision was taken not to follow the high-grade core ore body. The effect of dilution was mostly focused at the upper levels of the ore body where it is very narrow. By going to this depth, where the body is wider, the dilutive effect will be mitigated and it is expected that 6.2g/t of material will be processed until the end of the year. This change to the initial mining plan is not expected to effect 2011 production and we are confident of our production plans at Malomir.

 

Extra high grade ore processing was scheduled only for the first six months of the mine's operation and the decision not to follow the high grade ore is not expected to materially change the production schedule of the Quarzitovoye ore body. Mixing of extra high-grade ore body with surrounding lower grade material will ensure a smoother and lower risk production schedule going forward.

 

 

Malomir mining operations

 

Units

Q3 2010

Q3 2009

9 months to 30 Sept 2010

9 months to 30 Sept 2009

Total material moved

m3 '000

835

-

1,180

-

Ore mined

t '000

213

-

298

-

Average grade

g/t

1.9

-

1.6

-

Gold

oz '000

12.7

-

15.3

-

Malomir processing operations

 

Units

Q3 2010

Q3 2009

9 months to 30 Sept 2010

9 months to 30 Sept 2009

Resin in Pulp Plant

Total milled

t '000

56

-

56

-

Average grade

g/t

2.2

-

2.2

-

Gold content

oz '000

122

-

122

-

Recovery rate

%

87.5

-

87.5

-

Gold Recovered

oz '000

3.4

-

3.4

-

 

Omchak

Attributable production from Omchak in the nine months ended 30 September 2010 was 48,700oz. Following the acquisition of 32.5% and 7.5% of the issued capital of the Omchak Joint Venture from OAO Susumanzoloto and OAO Shkolnoye respectively, production for Q3 2010 is 100% attributable to the Group.

 

Alluvial Production and Joint Ventures

The Group's Odolgo Joint Ventures and alluvial operations contributed a further 29,800oz in the nine months ended 30 September 2010 (compared to 17,700oz in the same period of 2009) in line with the Group's forecast.

 

 

Development

 

Malomir

The commissioning of the second processing line at the Malomir mine is currently on track for H2 2011 and the conversion of the plant for floatation / high pressure oxidation operations is scheduled for H2 2012.

 

Albyn

Construction work at Albyn is currently on schedule for commissioning towards the end of H2 2011. The accommodation camp is under construction and progress has been made in completing the haul roads and power lines.

 

Exploration

 

Exploration work has begun on the newly-acquired licence areas at Pioneer and Albyn. 

 

Corporate Update

 

Listing of Non-Precious Metals Division On 21 October 2010, the Group's Non-Precious Metals Division, IRC, was listed on the Main Board of The Stock Exchange of Hong Kong Limited, with a market capitalisation of c.US$780 million at a final offer price of HK$1.80 per Offer Share. The listing raised gross proceeds of approximately US$241 million (assuming no exercise of the Over-allotment Option). Following the listing, Petropavlovsk continues to be the largest shareholder in IRC, with an interest of 65.6%.

 

Interim Dividend of 3 pence per Ordinary Share paid

In August 2010, the Board of Directors of the Company declared an interim dividend of 3 pence per Ordinary Share. The dividend was paid on 29 October 2010 to shareholders on the register as at 1 October 2010.

 

Production Forecast for 2010

 

In light of the various factors mentioned in this statement, the Group is revising its production estimate for the full year 2010 downwards and now expects annual production of c.510,000oz - 530,000oz.

 

Analyst Site Visit

 

The Group's annual analyst site visit was held between the 6 and 10 October 2010. The site visit is an opportunity for analysts and institutional shareholders to visit the Group's production facilities and this year's tour included visits to Pokrovskiy, Pioneer and Malomir. Of particular note was the opportunity to see the work to the side wall at Pokrovskiy, the area of Andreevskaya where stripping work is currently being undertaken, the newly-expanded Pioneer plant, the pit at Quarzitovoye and the newly-commissioned plant at Malomir. In addition, the group visited the central laboratory, Regis headquarters and the newly-commissioned metallurgical test plant in Blagoveschensk.

 

 

IRC Update

 

IRC, formerly the Non-Precious Metals Division of Petropavlovsk PLC, now has a separate listing from the Group following its IPO on the Main Board of The Stock Exchange of Hong Kong on 21 October 2010.

 

IRC is one of the first companies with Russian assets to undertake a Hong Kong listing. IRC remains a member of the Petropavlovsk Alliance and the Company retains a long-term commitment to IRC, currently holding 65.6% of the shares.

 

IRC's Kuranakh mine is now in production. The official commissioning ceremony in July 2010 was attended by Russian President Dmitry Medvedev.

 

Recent significant operational activities and developments include:

 

Kuranakh

·   Adjustments to the ilmenite circuit in the processing plant

·   Iron ore concentrate is now being transported by rail to IRC's target customer in Heilongjiang

·   Kuranakh now directly employs 1,015 people

·   At the Saikta open pit the mining of overburden continued on the horizons 710, 690, 680, 670, 660, and 650. Quantities mined consisted of:

 

-    Overburden removed:             244,200m3

-    Ore removed:                          75,900t

-    Total material moved:              268,400m3

-    Drilling works:                          15,902 l.m.

-    Blasting works:                        193,200m3

 

K&S

At K&S (Kimkan and Sutara), IRC's second mine site, the following work was recently undertaken:

 

·   Topographic-geodesic works scale 1:2000 - 80 hectares

·   Benchmarks installed: permanent - 2, temporary - 4

·   Prospecting shafts: upper side of the tailings dam - 6, bed of the tailings dam - 5

 

K&S now directly employs 385 people in its construction programme and discussions with the Chinese contractor and debt finance provider are ongoing with the aim of finalising the transaction structure.

 

Garinskoye

At Garinskoye, exploration continues at the main Garinskoye site, and at the Garinskoye Flanks.

 

Vanadium Project

IRC runs a joint venture for the processing of vanadium slag and production of vanadium products with Heilongjiang Jianlong Steel Company Limited and Kuranakii Investment Co., Limited, based in Jiamusi. Construction at the project site has begun.

 

 

Sales of iron ore concentrate

Discussions are ongoing with nine potential customers.

 

Forward-looking statements

This release may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this release and include, but are not limited to, statements regarding the Group's intentions, beliefs or current expectations concerning, among other things, the Group's results of operations, financial position, liquidity, prospects, growth, strategies and expectations of the industry.  

 

By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Forward-looking statements are not guarantees of future performance and the development of the markets and the industry in which the Group operates may differ materially from those described in, or suggested by, any forward-looking statements contained in this release. In addition, even if the development of the markets and the industry in which the Group operates are consistent with the forward-looking statements contained in this release, those developments may not be indicative of developments in subsequent periods. A number of factors could cause developments to differ materially from those expressed or implied by the forward-looking statements including, without limitation, general economic and business conditions, industry trends, competition, commodity prices, changes in law or regulation, currency fluctuations (including the US dollar and Rouble), the Group's ability to recover its reserves or develop new reserves, changes in its business strategy, political and economic uncertainty.  Save as required by the Listing and Disclosure and Transparency Rules, the Company is under no obligation to update the information contained in this release.

 

The material set forth herein is for informational purposes only and does not constitute an offer of securities for sale in the United States or any other jurisdiction in which such an offer or solicitation is unlawful.  The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act"), or the laws of any state, and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state laws.  No public offering of securities will be made in the United States.


This information is provided by RNS
The company news service from the London Stock Exchange
 
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