JOHANNESBURG (miningweekly.com) – LSE-listed Polymetal on Wednesday reported that it had produced 405 000 oz of gold equivalent (GE) from its operations in the fourth quarter, an 8% increase over the same period in the previous year.
Total GE production for the full year increased 13% year-on-year to 1.43-million, 2% above its initial production guidance of 1.4-million ounces.
"The strong finish to 2017 was driven by contributions from the fully ramped-up Svetloye heap leach, as well as a strong performance at Komar, Omolon and Amursk-Albazino," the company said about the mines, all located in Russia.
Gold production in the quarter was 317 000 oz, an 11% year-on-year increase, while silver production was down 6% to 6.6-million ounces, owing to the planned grade decline at the Dukat underground mine, in Russia's Magadan region.
Full-year gold production totalled 1.07-million ounces, a 21% increase year-on-year, allowing Polymetal to join the prestigious one-million-ounces club, the second LSE premium-listed gold company to achieve this milestone.
Based on the strong numbers, the company's production guidance for 2018 and 2019 was set at 1.55-million ounces and 1.7-million ounces of GE, respectively.
The main growth drivers would be the ramp-up of Kyzyl, the recommissioning of the oxide circuit at Mayskoye, in Russia, and incremental improvements at Varvara, in Kazakhstan, and Kapan, in Armenia. This should offset anticipated grade declines at Khakanja and Voro.
The 300 000 oz/y Kyzyl project, in Kazakhstan, was progressing on schedule with commissioning expected to start in July and first concentrate expected in mid-August. During the quarter, the company completed the tailings storage facility and installed the run-of-mine ore crusher unit. First ore has been mined from the openpit in January, ahead of schedule.
"Polymetal delivered a strong finish to 2017 and exceeded production guidance for the sixth year in a row," said Polymetal CEO Vitaly Nesis.
"We have an important year ahead of us with first production from Kyzyl paving the way for investment decisions on Nezhda and POX-2. All the while, we will continue to deliver positive free cash flow and prioritise dividends in our capital allocation process," he added.