Eurasia Mining PLC Semenovsky Tailings Project (1081I)
15 June 2017 - 4:00PM
UK Regulatory
TIDMEUA
RNS Number : 1081I
Eurasia Mining PLC
15 June 2017
Eurasia Mining plc (AIM: EUA)
("Eurasia" or the "Company")
Semenovsky Tailings Project - Extension of Agreement
Eurasia Mining plc, the Russia focused Platinum, PGM and gold
production and development company, is pleased to announce an
extension to the Heads of Terms agreement with OOO Metallurg
Complect, over the Semenovsky Tailings Project ("STP"). Eurasia's
exclusive right to acquire up to 67per cent of the project has now
been extended to end of August 2017. This timeline ensures
sufficient time for Eurasia to continue its development program at
Semenovsky, ahead of making a final decision on participation.
Background to the Semenovsky project and metallurgy
Eurasia's initial agreement with Metallurg Complect was executed
on 16 November 2015. Throughout 2016 Eurasia has made significant
progress in developing the project towards mining. Eurasia
contracted the writing of a feasibility study and reserves report
and achieved approval of these reserves in August 2016.
The maiden reserves at the project were approved as 2.99 million
tonnes of ore grading 1.18 grams per tonne ("g/t") of gold and
16.44 g/t of silver, with contained metal calculated as 3.5 tonnes
of gold and 49.3 tonnes of silver (see RNS dated 31 August 2016 for
full details of these results).
Subsequently, Eurasia undertook a metallurgical testing program
to further clarify the best process by which to recover gold and
silver from these mine tailings. Ultimately it was found that a
'low-tech' circuit liberating 40per cent of gold in cyanide leach
tanks, and recovering gold from solution using a manufactured resin
was found to present robust economics (see RNS dated 22 December
2016)
Internal calculations undertaken by Eurasia on STP indicate an
8.5-year mine life, producing an average of 4,938 ounces of gold
and 682,000 ounces of silver per annum and generating total
revenues of $57 million at a gold price of $1,135 per ounce
(December 2016 prices). Eurasia has estimated that free cashflow
after allowing for processing costs, land rehabilitation and
relevant taxation would total $33million or $3.8 million per annum.
At a 10per cent discount rate Eurasia has estimated the project Net
Present Value to be approximately $15million with a project
Internal Rate of Return of approximately 54per cent. However, at
this stage, there can be no guarantee that these results will be
achieved.
Bulk testing program
A further option, which is now being costed and discussed in
greater detail involves transport of a bulk sample to a nearby
operating gold plant to test gold recovery at an industrial scale.
This may be considered as the final due diligence exercise in
de-risking the project ahead of a decision on whether to proceed to
building the mine. This operation is now being costed by Company
representatives who are visiting the proposed plant. The plant
comprises crushing, grinding and leaching circuits, with subsequent
recovery of gold from leach solutions via a Merill Crowe Machine.
To replicate the proposed plant at Semenovsky it is proposed to
bypass the initial crushing and grinding circuits, and deliver
Semenovsky ore direct to the leaching circuit. An update will be
provided on this work as and when information becomes
available.
Christian Schaffalitzky, CEO of Eurasia commented:
"I am delighted that Eurasia's exclusive right to acquire up to
67 per cent of the Semenovsky Tailings Project has now been
extended to end of August 2017 as this ensures sufficient space for
the Company to continue its development program. I look forward to
updating shareholders with our final decision on whether to
participate in the coming months."
Consent for release
Christian Schaffalitzky, FIMMM, PGeo, CEng, is a director of the
Company. He has reviewed the update and consents to the inclusion
of the exploration information in the form and context in which it
appears here. He is a Competent Person for the purposes of the
reporting of these results.
This announcement includes inside information as defined in
Article 7 of the Market Abuse Regulation No. 596/2014 and is
disclosed in accordance with the Company's obligations under
Article 17 of those Regulations.
Enquiries:
Eurasia Mining Plc
Christian Schaffalitzky/Michael de Villiers
+44 (0)207 932 0418
WH Ireland Limited
Katy Mitchell/James Sinclair-Ford
+44 (0)161 832 2174
Beaufort Securities
Elliot Hance
+44 (0)207 382 8300
Blytheweigh
Tim Blythe/Camilla Horsfall
+44 (0)207 138 3204
Notes to Editors
Eurasia Mining Plc is a Platinum Group Minerals ("PGM")
production, development and exploration company with an exciting
portfolio of assets in Russia. It commenced its first full season
(May until late October) of production from its West Kytlim mine
this year. It is also continuing to develop its asset portfolio,
with the Monchetundra project now at Mining Licence application
stage.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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