Precious metals mining company Polymetal International has purchased the remaining 20% stake in Saum Mining Company, which holds the licence for the Saum polymetallic deposit in Russia.
The transaction, which comes after a successful exploration drilling campaign at the property, increases Polymetal’s interest in the Saum deposit to 100%.
With resources of 435Koz of gold equivalent at 9.7g/t, the deposit covers an area of 34.2km² in Russia’s Sverdlovsk region in the Ural Mountains.
In exchange for the 20% interest, Polymetal issued 834,055 new ordinary shares worth $7m to the seller.
Polymetal Group CEO Vitaly Nesis said: “Our strategy at Voro is increasingly focused on extending the life of mine through nearby exploration targets, with the potential addition of a flotation circuit to the existing processing plant.
“Saum fits this vision perfectly. High grades and good infrastructure will enable low capital intensity, low costs, and a quick route to free cash flow, which further strengthens the rationale for a flotation project at Voro.”
With volcanogenic massive sulphide type mineralisation, the Saum deposit hosts thick near-surface tabular ore bodies that indicate feasibility of open-pit mining at a low stripping ratio.
The deposit has estimated JORC 2012 compliant total indicated and inferred mineral resources of around 1,390kt.
It is located around 240km from Polymetal’s Voro processing plant. Oxide ore from the deposit will be processed through the existing carbon-in-leach (CIP) plant at Voro.
Polymetal is planning to prepare an initial reserve estimate in the first quarter of next year and begin oxide ore mining activities in the second half of 2020.