Eurasia Mining PLC Monchetundra Mine Permit License Fee (7541J)
07 December 2018 - 6:00PM
UK Regulatory
TIDMEUA
RNS Number : 7541J
Eurasia Mining PLC
07 December 2018
Eurasia Mining plc (AIM: EUA)
("Eurasia" or the "Company")
Monchetundra Mine Permit License Fee
Eurasia Mining plc (AIM: EUA), the PGM and gold producing
company, is pleased to announce that, following from the official
notice of the final award of the Monchetundra Mine permit,
Rosnedra, the Russian Federal agency responsible for mining, has
yesterday (06 December 2018) given notice of the one-time license
payment terms.
The size of the payment has now been calculated by Rosnedra as
RUR20,843,788, 20% of which (RUR4,168,758 or GBP48,853) is to be
paid within 30 calendar days of registration of the licence at the
state register of subsoil licences. The remaining 80% of the
one-time license fee is payable within 5 years of the date of the
licence's registration. These terms are stipulated in Russian
subsoil licensing laws where a licence has been awarded to a
Company based on a state approved mineral resource which the
Company has itself identified.
It is expected that the official document will be transferred to
the Company in the coming weeks and it is the Company's intention
to the pay the initial 20% of the license payment from available
funds on registration of the license. The balance is expected to be
met as part of the capital development of the project.
Background to the Monchetundra Project.
The Monchetundra project contains a state approved reserve and
resource of circa 2Moz Pd equivalent (1.9Moz palladium dominant
2PGE as palladium, platinum and gold) with significant additional
nickel and copper revenue streams. The Project is located adjacent
to the town of Monchegorsk, 130km south of Murmansk on the Kola
Peninsula, bordering Finland in Northwest Russia. A mine permit was
awarded to the Company and was fully authorised by Prime Minister
Dmitry Medvedev in late November 2018. Further communication with
Rosnedra has proceeded regarding the official transfer of the
physical mine permit, which the Company is obliged to register with
the state. This and other administrative items are expected to
proceed as per due process in the second and third weeks of
December 2018.
The Monchetundra Project has an in-situ total reserve and
resource value of approximately US$2.1 billion (an internal
calculation based on London Metal Exchange November 2018 spot metal
prices, and prepared for guidance only) and is now fully permitted
for mining.
As previously announced, an Engineering Procurement Construction
& Financing ("EPCF") contract is in place with the Chinese
state-owned major infrastructure project group Sinosteel, for 85%
(or US$149.6M) of a total contract value of US$176M. A US$50M
sub-contract is specified within the contract and is assigned to
Eurasia's 80% subsidiary Terskaya Gornaya Kompany ("TGK"), or a
sub-contractor of its choosing, for engineering and pit development
works in advance of mining.
The 1.9M oz Pd eq reserve and resource (with a 3:1 Pd:Pt ratio
in favour of palladium based on production) with base metals
credits is now permitted for extraction at two open pit locations,
West Nittis and Loipishnune (for further details see announcement
dated 31 May 2017).
Currently, state approved reserves and resources within the
Monchetundra Project comprise Russian standard C1 and C2 categories
of 59 tonnes (1.9 million ounces) palladium equivalent (2PGE + Gold
with a Palladium to Platinum ratio of 3:1 based on production
ounces) at two open-pittable locations, West Nittis and
Loipishnune. These open pits also contain significant base metal
credits including 28,124 tonnes of copper, 30,410 tonnes of nickel.
The Directors consider the project to be unique globally in being
led by high palladium grades, and that it represents a significant
lower cost open pit mining operation which compares favourably to
the relatively expensive underground operations in South Africa,
the dominant player in the global PGM market.
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 Tel: +44 (0)207 932 0418
Christian Schaffalitzky / Keith Byrne
WH Ireland Limited (Nominated Adviser Tel: +44 (0)161 832 2174
& Broker)
Katy Mitchell / James Sinclair-Ford
First Equity Limited (Joint Broker) Tel: +44 (0)20 7374 2212
Jason Robertson
Optiva Securities (Joint Broker)
Christian Dennis Tel: +44 (0) 20 3137 1902
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END
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