Aim-listed Eurasia Mining on Tuesday announced the approval of the Monchetundra mine permit application by the Russian Ministry of Economic Development (MOED).

The mine permit application, for the 80%-owned two-million-ounce platinum-group metals (PGM) reserve and resource, is now awaiting sign off at the Ministry of Natural Resources, before progressing to the office of Prime Minister Dmitry Medvedev for final approval.

The PGM and gold producing company said that the application process remained on track to be completed by late summer.

CEO Christian Schaffalitzky dubbed the approval “another key milestone that came sooner than expected”.

He explained that the process was entering its final stage of approval before the anticipated signing at the office of the Prime Minister.

So far, the application has progressed faster than at the West Kytlim project, he noted.

Currently, State-approved reserves and resources within the Monchetundra project comprise Russian standard C1 and C2 categories of 55.9 t, about two-million ounces, of palladium equivalent at two open-pittable locations, West Nittis and Loipishnune.

These openpits also contain significant gold and base metal credits including 28 124 t of copper, 30 410 t of nickel and 2 t of gold.

Eurasia Mining directors believe the project to be unique globally in being led by high palladium grades, and that it represents a significant lower cost openpit mining operation, which compares favourably to the relatively expensive underground operations in South Africa.

An engineering, procurement, construction and finance agreement is already in place with Chinese State-owned infrastructure group Sinosteel, which has arranged 85%, or $149.6-million, of the contract value as debt.

A further $50-million sub-contract has been assigned by Sinosteel to Eurasia's subsidiary Terskaya Gornaya Kompany for the development of the two openpits in preparation for mining and may be drawn down in advance of the main mine construction.

Meanwhile, discussions continue with other third-party service providers regarding the running of the mine at Monchetundra.

Eurasia hopes to emulate the contract mining arrangement used at West Kytlim by contracting the mining operation to a reputable international specialist company with experience in Russia, while maintaining control of the project, for a percentage of gross revenue.