Polymetal is pursuing greenfield exploration projects with the aim of discovering gold and precious metal deposits with stand-alone economic significance. Typically, the standalone mines the company targets need to meet some internall criteria of driving the cost and, ultimately, the return on capital invested into the project.
Polymetal key standalone projects include Avlayakan-Kirankan (the “AK project”), Kutyn, Svetloye, Tamunier, Prognozny, and Elmus with total mineralized potential of 5.7-7.5 Moz.
Avlayakan-Kirankan (the ‘AK Project’)
Resources and mineralized potential
Total JORC-compliant mineral resources are 126 Koz of GE at 11.8 g/t and Ore Reserves are 323 Koz of GE at 21.4 g/t.
Mineralised potential of the zone (inclusive of resources) is estimated at 2.5-3.5 Mt at 8-12 g/t for 0.8-1.0 Moz of gold contained (internal non-JORC estimate).
Location, access and history
The AK Project consists of a combined area covered by four licences: Avlayakan, Kirankan, the Avlayakan-Kirankan watershed and the Maymakan-Kundumi watershed. It covers an area of 323 sq km in the Khabarovsk Territory and is located approximately 250 km north-east of Albazino. The project area is unpopulated and mostly covered with taiga forest.
The nearest settlement is Kiran (which has a population of approximately 600 people) on the Sea of Okhotsk. Kiran is located 110 km to the south of the AK Project and is accessible by a 350 km winter road which is operational for roughly 80 to 100 days per year. Kiran is the centre of local gold placer mining activities. It has an airstrip capable of accommodating small and medium-sized aircraft. Ships can also anchor offshore at Kiran and offload material to barges for onward transport. Access to Kiran by sea is possible from early June to mid-October every year. The port of Okhotsk, which serves as an access point to Khakanja, is located 630 km to the north-east of Kiran.
Active placer mining in the area commenced in the early 1960s. Hard-rock gold mineralisation was first discovered in 1974. Several significant exploration campaigns took place in the 1980s and the early 2000s. From 2006 to 2008 a Canadian company, Silver Bear Resources, owned 70% of the property and undertook further exploration and metallurgical testing, after which, the property was sold to private owners. In 2010, Polymetal acquired 100% of the AK Project from its private owners. Trial open-pit mining started at the Avlayakan mine in the third quarter of 2010.
Geology and Mineralization
The licence areas host numerous gold and silver vein-type deposits which are typically associated with zones of altered rocks. Several clusters of veins are currently subject to active exploration by Polymetal, including Avlayakan, Kirankan, Meyvachan, Kundumi and Tok. All of these stand-alone exploration targets have mineralisation of a gold-quartz low-sulphidation epithermal type.
Gold to silver ratios and detailed mineralogy vary considerably amongst individual veins. Gold is mostly free, but displays significant variations in grain size. Silver is mostly represented by sulphides. The average ore body width varies from 2 to 10 m, with all mineralisation having a steep dip.
Currently more than 20 individual veins have been discovered. Avlayakan is the most advanced target with six veins traced with a combined strike length of 1,600 m and from 50 to 200 m down-dip. Non-outcropping blind veins have also been intersected.
The Avlayakan ore has been subject to extensive metallurgical testing both by Polymetal and the previous owners of the property. Mineralisation is free-milling, with recovery from conventional cyanidation in excess of 90% for both gold and silver. In some veins, Polymetal has observed the presence of coarse gold. Heap leach tests were performed for low-grade material from two of the veins at Avlayakan (the central and north-eastern veins).
Exploration Activity
In 2011 a trial mine was developed in the Central ore zone and ore mined was transported to Khakanja plant. In the second half of 2011 additional exploration drilling of 2,745 m was completed in the North-East zone. Exploration activity is continuing.
North-East zone cross section
Download selected exploration results.
Kutyn
Resources and mineralized potential
Total JORC-compliant inferred mineral resources are estimated at 5.5 Mt of ore, grading 4.1 g/t of gold with 717 Koz of gold contained.
Mineralised potential of the zone (inclusive of resources) is estimated at 10.0-15.0 Mt at 2.5-3.5 g/t for 1-1.2 Moz of gold contained (internal non-JORC estimate).
Location, access and history
The Kutyn licence area is located in the Khabarovsk Territory, Far East of Russia, 113 km north-east of Albazino and 10 km from the Sea of Okhotsk. Seasonal access to Kutyn is possible through the Gulf of Ulban. The project area is unpopulated and covered with taiga forest. There has been active gold placer mining in the licence area since the 1970s, with hard-rock gold mineralisation being discovered in 1979. Limited exploration was carried out between 2004 and 2007 and consisted mostly of trenching and surface diamond core drilling. Polymetal acquired the deposit in 2011.
Geology and mineralisation
Mineralisation at Kutyn is associated with carbonate-sericite-quartz metasomatic bodies with sulphide-quartz veins. Seven ore zones were identified extending 2 to 3 km along strike. All of these zones are open at depth and along strike. Zones are steeply dipping and have average width between 3 to 7 m. Near-surface material is oxidised to a depth of 50 to 60 m. Gold in primary mineralisation is mostly associated with pyrite while gold in the oxidized zone and is predominantly free and very fine grained. In 2008, Irgiredmet performed heap leach testing on oxidised material.
Exploration Activity
In Q4 2011 drilling of 54.0 km in Kutyn gold ore deposit was done in ore zones Sedlovina, Rodnik and Geophysical. Four technological samples of total weight of ca. 1 tonne were taken in order to evaluate technical characteristics of oxidized and primary ores. All holes demonstrated zones of quartz-sericite altered rocks with thin veins quartz and sulphides mineralisation (up to 3-5% of pyrites and arsenopyrite). Exploration activity is continuing.Kutyn zone cross section
Svetloye
Resources and mineralized potential
Inferred mineral resources reached 4.08 Mt of ore at average gold grade of 5.85 g/t, average silver grade of 4.1 g/t, gold content - 767 Koz, silver content - 544 Koz.
Total mineralised potential of the zone (inclusive of resources) is estimated as 30-40 Mt at 1.8-2.2 g/t for 2-2.5 Moz of contained gold.
Location, access and history
Svetloye is located 220 km south-west of Okhotsk, the access port for the Group’s Khakanja mine and approximately the same distance from Khakanja itself. It is accessible by a 380 km winter road from Okhotsk or via the Ulya river, which flows 90 km from Svetloye. The project area is unpopulated and consists of river valleys covered with taiga forest and hilltops covered with tundra.
Svetloye deposit is formed by ore zones Emmy, Elena, Ludmila, Larisa, Tamara.
Geology and mineralisation
Gold mineralisation at Svetloye was formed by a high-sulphidation epithermal system representing fossil caldera. Svetloye is marked by numerous zones of alteration and mineralisation. These altered zones host mineralised prospects and exploration targets of variable sizes and grade ranges.
Most of the gold mineralisation is generally very fine grained and disseminated within the silica. Gold-bearing silicification occurs as flat lenses or pods, which outcrop at the surface and have true widths of between 20 and 120 m. Higher-grade zones are adjacent to breccias. The oxidation zone is developed to a depth of 100 m in some targets. Initial metallurgical tests have been undertaken for the oxide mineralisation. These tests confirmed a recovery rate of above 90 % gold recovery by way of cyanide extraction with low cyanide consumption.
Exploration Activity
In 2011 technical samples were taken for further laboratory analysis. Preliminary evaluation was made in ore zones Elena, Emmy and Tamara. In August 2011 Snowden specialists visited the deposit and internal resource evaluation was completed.
The exploration activity is continuing in 2012.
Tamunier
Resources
Snowden Mining Industry Consultants Inc. (“Snowden”) has estimated a JORC-compliant Mineral Resource for the company’s Tamunier project of 50Mt at 1.2 g/t gold. Further substantial exploration potential has been identified with ongoing exploration seeking to expand and upgrade the resource estimate.
Download Tamunier resources estimate
Location, access and history
Tamunier, together with the adjacent Vasilyevsky license (combined license area of 53 km2) is located in Sverdlovsk region of Russia, 182 km north from Voro, an operating mine owned by Polymetal, and 67 km from the closest large town of Ivdel (population 18 thousand). Mineralization was discovered at Tamunier in the 1960s during an exploration campaign targeted at VMS base-metal mineralization. Polymetal acquired mining and exploration subsoil rights (licenses) from the state for Tamunier in 2007 for US$ 536,000 and for US$ 161,000 for Vasilyevsky in 2011.
Tamunier is located in a historical mining area with good infrastructure. The project is accessible by year-round gravel road. The nearest paved road is 5 km away, the 110-kV power line is 18 km away, and the nearest railway spur is 41 km away, all to the south.
Geology and mineralisation
The Tamunier mineralization is characterized by zones of disseminated sulfide (mostly pyrite) and containing gold. The mineralization is within an extensively altered volcanoclastic Devonian sequence intersected by several north-south traced faults.
Structures hosting the mineralization consist of mineral bearing metasomatites that have been traced by drillholes for 3 km along strike and for 350 m to 400 m down-dip. The mineralized zone is from 300 m to 700 m thick with boundaries along strike and down-dip that have not been defined. The mineralization does not have clear geological boundaries and outlines can only be determined on the basis of sampling.
Exploration Activity
Following geophysical and geochemical studies and the drilling of 155 prospecting holes, Polymetal drilled 129 exploration diamond holes and these are the basis of the 2012 Mineral Resource estimate. The new holes are up to 200 m depth from the surface with 100 m x 50 m and 50 m x 25 m drill patterns. This totals to 29,200 m of core drilling and 28,977 samples including 4,000 assays completed.
Metallurgy
Polymetal Engineering has performed testwork on a suite of representative samples derived from mineralized drill cores from Tamunier, and based on the results of the testwork has the following findings:
- Direct cyanidation yields low recovery of 57.9% for gold using a sample grind at P80 of -0.074 mm.
- Heap leaching is not feasible
- Most gold can be dissolved in cyanide after fine grinding to P80 at -0.028 mm suggesting the amenability of moderate ultrafine grinding (UFG) metallurgy cyanidation techniques
- Concentration (gravity-flotation) is feasible to produce a gold-pyrite concentrate grading 16 g/t Au to 20 g/t Au at an overall recovery of 83% gold to concentrate and 5% mass yield
- Testwork on UFG of concentrates and whole ore is ongoing
Prognozny
Resources and mineralized potential
Mineralised potential of the zone is estimated at 1-1.5 Mt at 5-7 g/t for 0.2-0.3 Moz of gold (internal non-JORC compliant estimate).
Location, access and history
Prognozny is located 40 km from the Sopka mine and 120 km from the port of Evensk. Access is by a road from Evensk to Sopka followed by a 25 km stretch of winter road. Prognozny was discovered by Kinross Gold in the 1990s during their regional grass-roots exploration efforts and was acquired by Polymetal as a part of the acquisition of the Kubaka processing plant in 2010.
Geology and mineralisation
Prognozny is characterised by near-surface disseminated gold-quartz mineralisation in sedimentary rocks. Gold is mostly free and very fine-grained. The mineralisation contains very little sulphide and is contained within sandstone. Productive mineralisation carries grades of 2 to 5 g/t, is shallow dipping and is occasionally almost horizontal, with an average width between 10 and 30 m. Mineralisation boundaries cannot be determined visually and all of the three potential ore bodies are open in both directions along the strike.
Exploration Activity
Exploration activity in deposit performed in 2011 (drilling – 6,013 m, trenches – 11.7 th. m3) allowed to specify ore body 1 parameters. Ore intercepts were discovered in two more ore bodies that form deposits sub parallel to the first body.
In 2012 the Company plans to complete the deposit evaluation stage, perform geotechnical research on technological recoverability of metal contained, and complete preparation of the reserves report for Russian mining authorities’ approval.
Download selected exploration results.
Elmus
Mineralised potential
The area is currently at the initial stage of exploration. At the moment there are no reserves or resources estimated for Elmus according to the JORC Code.
Location, access and history
The licence area covers 188 sq km in the Republic of Karelia (north-west of Russia). It is located approximately 45 km from the city of Medvezhiegorsk (which has a population of approximately 15,300 people) and is 490 km north of Saint Petersburg. The property is located 150 km from the border with Finland, in a sparsely populated area with active logging operations. The area is accessible by paved road, save for the last 7 km to Elmus, which consists of dirt road. Transportation and logistical access to Elmus is also provided by rail, with the nearest railway track being 28 km away from Elmus.
Gold mineralisation at Elmus was discovered in 1995 during exploration for uranium. Limited drilling took place from 2005 to 2007. Polymetal acquired the property in 2011 from private owners.
Geology and mineralisation
Mineralisation at Elmus is contained in very old greenstone rocks. The mineralised zone is approximately 30 m wide and is adjacent to a steep contact between ancient shales with younger quartzites. Gold is found in quartz-pyrite and quartz-carbonate material, mostly in free form.
The property has a very large geochemical footprint. Large intensive surface gold anomalies are found within the glacial till which overlays most of the property.
Exploration Activity
In Q3 2011 the Company has started field activity in Elmus. In 2011 exploration concentrated on Perdrolampi, Talmus and other areas. During this period a complex of geological and geophysical exploration was conducted and diamond drilling of 3,900 m was done. Exploration activity is continuing.
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