Results of geological explorationIn 2010 the Company continued realization of its Exploration Program for 2006-2010, which was approved by the Board of Directors of OJSC Polyus Gold immediately after the incorporation of the Company in 2006.In 2010, the Group‘s exploration team worked at 28 hard-rock gold deposits and at 25 placer sites in five regions of the Russian Federation, namely in the Krasnoyarsk, Magadan, Irkutsk and Amur Regions and in the Republic of Sakha (Yakutia). Geological exploration work continued in Kazakhstan at the Aksu, Bestobe, Zholymbet and other deposits. In 2010, licenses for the Vangash and Verkhnekadrinskaya areas (Krasnoyarsk Region); for the Smezhny site and six licenses for placer gold (Irkutsk Region); for the Burgakhchan, Gus and Erguneisky sites (Chukotka Autonomous District) were acquired through auctions. In 2010, the Group’s overall geological exploration costs across the Russian Federation amounted to USD 32.3 million, compared to USD 32.5 million in 2009. The total drilling amounted to 155.6 thousand meters. The completion of the exploration work in 2010 resulted in an increase in reserves under categories В+С1+С2 by 12.0 tonnes. This included:
The low growth is due to the fact that the submission to and approval by the GKZ of the reports for the Verninskoye, Kuranakh, Panimba, Poputninskoye, Degdekan deposits has been transferred into 2011. The 2010 geological exploration costs for the Republic of Kazakhstan amounted to USD 11.9 million. The total drilling in 2010 amounted to 31.8 thousand meters. The reserves will be added to the state reserve balance and the growth estimation is expected by the end of 2011. Estimates in accordance with JORC standards, will be reflected in Wardell Armstrong report in the 1st quarter 2011. The completion of operational exploration in 2010 resulted in the increase of the В+С1+C2 reserves by 5.4 tonnes. Krasnoyarsk RegionIn 2010, the Company carried out exploration activities across four projects in the Krasnoyarsk Region: the Olimpiada (deep horizons) and Poputninskoye deposits, and the Panimbinskaya and Razdolinskaya ore fields. Design work was underway on the Vangash and Verkhnekadrinskaya areas purchased through auctions in 2010. Panimbinskaya areaExploration on the Panimbinskoye deposit was completed in the reporting year. The feasibility study of permanent exploration conditions is being developed, and a report with reserve estimate is being prepared. Prospecting work was completed on the flanks of the deposit (Tavlik, Mikhailovsky and Shalokit sites). Prognostic resources under categories P1+P2 amount to 18 tonnes. Razdolinskaya areaProspecting and evaluation work was completed on the Razdolinskaya area. As a result, a pre-feasibility study was prepared; C2 category reserves were estimated at 11.5 tonnes (Zmeinoe ore occurrence) and P1 category resources at 24 tonnes (Zmeinoye, Svetloye, Antoninovskoye ore occurrences). Poputninskoye depositExploration work on the deposit was completed, and process guide developed. Work on the feasibility study and reserve estimation report is being completed. The Poputninskoye deposit reserves are expected to be at least 75 tonnes (2.5 million ounces) under categories C1+C2. Irkutsk Region (hard-rock)In 2009 exploration work in the Irkutsk Region was carried out at the following units: the Verninskoye, Pervenets and Zapadnoye deposits. Verninskoye, Pervenets deposits
In 2010, the feasibility study was completed, and a report with reserve estimate was prepared. At the decision of the Investment Committee, the materials submitted to the GKZ were recalled, the feasibility study was adjusted with the cut-off grade changed from 0.75 to 1.0 g/t, and the adjusted study was re-submitted to the GKZ. It is expected that, following the approval by the GKZ, the balance reserves will amount to 148 tonnes (4.7 million ounces) under categories С1+С2, with a cut-off grade of 1.0 g/t. The increase in reserves will amount to 100 tonnes (3.2 million ounces). The increase of the cut-off grade will decrease the reserves, but will enable the deposit to be developed with higher economic efficiency. Zapadnoye depositIn 2010, supplementary exploration of the Zapadnoye deposit was completed, and gold reserves of 14 tonnes (0.4 million ounces) were added to the balance, under categories C1+C2. As a result of supplementary exploration, reserves grew by 7.8 tonnes (0.2 million ounces). Smezhny siteIn 2010, a license for subsoil use was purchased at an auction, the geological exploration project passed state expert examination and obtained all necessary approvals. Prospecting work started on the flank of the Verninskoye deposit. The total potential reserve growth for the license is in the range of 60 tonnes (1.9 Moz) of commercial reserve categories. Irkutsk Region (alluvial deposits)In 2010 the Company continued geological exploration at placer deposits in the Irkutsk Region. Prospect evaluation and exploration activities were carried out in 23 areas while operational exploration was carried out in 11 areas. In 2010, the current growth of reserves under category C1+C2 as a result of prospective exploration and evaluation work amounted to 3.1 tonnes (0.1 million ounces). According to the Territorial Reserves Committee’s expert examination, 4.2 tonnes (0.1 million ounces) of gold were listed on the balance, including 3.0 tonnes for newly explored properties. Republic of Sakha (Yakutia)KuranakhA feasibility study of permanent conditions and a report with reserves recalculation were prepared for the Kuranakh ore field deposits in 2010 due to revision of the conditions. The feasibility study and the report were submitted to the Yakutia Subsoil Use Department for consideration.
Nezhdaninskoye depositAs part of a technical alliance with Kinross Gold Corporation, prototype tests of Nezhdaninskoye ore concentrate processing by SGS Canada were performed. The development of a comprehensive process guide is at the completion stage.
Amur RegionIn the Amur Region, only one project was underway — revision and evaluation work at the Bamskoye deposit. The Company is waiting for the government’s permit to be issued for mineral resource exploration and production.
Magadan RegionThe Company holds licenses for geological exploration work on 2 projects in the Magadan region Degdekanskoye ore fieldAs part of a technical alliance with Kinross Gold, the exploration of the Verny site was completed, and the prospect evaluation survey at the Zhilny site was completed. A report on the prospect evaluation stage of the geological exploration was prepared, and an estimate of reserves and resources of the C2–P1 categories. According to the current estimation, the geological reserves under categories C1+C2 amount to 92 tonnes (2.9 million ounces) with the cut-off grade of 0.6 g/t, including 37 tonnes (1.1 million ounces) in the pit perimeter, with the average grade of 2.26 g/t. Chai-Yuryinskaya prospective areaTest survey was performed at the Chai-Yuryinskaya prospective area, which will provide the basis for the prospecting and exploration work methodology adjustment. KazakhstanIn 2010, the Company continued geological exploration work aimed at evaluating the reserves for open- pit mining at the following deposits in the Republic of Kazakhstan: Aksu, Bestobe, Zholymbet, Yuzhnoye Karaul-Tyube, Akzhal, Kasbulakh. The total exploratory drilling in 2010 amounted to 31.8 thousand meters, and operational exploratory drillingof 6.6 thousand meters. Akmolin regionAksu depositIn 2010, geological exploration and detailed operational exploration work continued, with drilled amounted of 16.5 thousand meters. As a result of the work, 0.76 tonnes of gold under category C1 were added to the balance in the Pit zone, with an average gold grade of 1.11 g/t. Reserves of 7.7 tonnes of gold under categories C1+C2 were added to the balance for tailings, with an average gold grade of 1.04 g/t. Total balance reserves for the Aksu and Quartzite Hills deposits amounted to 47.0 tonnes of gold under categories A+B1+C1+C2, as at 1 January 2011. BestobeValidation and prospect evaluation activities were performed within the Central zone of the deposit. The footage drilled amounted to 3.4 thousand meters. Per current estimation, C1+C2 reserves amounted to 20 tonnes of gold down to the depth of 150 m, with an average gold grade of 1.68 g/t. For tailings 7.5 tonnes of gold in the C1+C2 categories were added to the balance, with the average gold grade of 0.96 g/t (including C1 — 7.2 tonnes, average grade 0.94 g/t). A total of 35.7 tonnes of gold under categories A+B1+C1+C2 were included in the balance as at 1 January 2011. Zholymbet depositValidation and prospect evaluation activities were performed on the Central, Artemievsky and Yurievsky sites, and exploration work at Pit No. 5 site. The footage drilled amounted to 5.8 thousand meters. According to current estimations, the Central site reserves (Pit No.5) down to the depth of 200 m amount to 5 tonnes of gold under categories C1+C2. A total of 47,594 kg of gold under categories A+B1+C1+C2 were included in the balance as at 1 January 2011. Yuzhnoye Karaul-TyubeProspect evaluation drilling on the Yuzhny and Promezhutochny sites was completed in the amount of 2.97 thousand meters. According to current estimates, oxidized ore reserves in the Yuzhny site down to the depth of 60 m amount to 3.3 tonnes of gold under categories C1+C2 with an average gold grade of 1.5 g/t. East Kazakhstan regionAkzhal depositExploratory work on oxidized ores and evaluation work on primary ores continued. The drilling volume was 8.1 thousand meters. According to current estimations, primary ore reserves amount to 1.5 tonnes of gold under categories C1+C2. A total of 0.9 tonnes of gold under categories C1+C2 were included in the balance as at 1 January 2011.
Kaskabulak depositGeological exploration work continued for the Osnovnaya and Stockwork zones including drilling of 2.0 thousand meters. According to current estimates, oxidized ore reserves amount to 0.5 tonnes of gold under categories C1+C2, and primary ore reserves amounted to 2.0 tonnes of gold under categories C1+C2. Mineral resources base at 31 December 2010Mineral resources base in accordance with the classification of the RF State Reserves Committee
*Reserves and resources of each deposit are given in full and include reserves and resources attributable to the share of minority shareholders of the companies of the Polyus Gold Group. Changes in the Company’s mineral resources base in the reporting year. B+C1+C2 reserves, in millions of ounces
Mineral resources of the Company according to JORCThe Company has been keeping a balance of mineral resources in accordance with the Russian and international classifications since its foundation. The Company’s reserves are accounted for the State balance of mineral resources of the Russian Federation. The Company has been having its mineral and raw material resources audited in accordance with the JORC Code in order to provide the investing community with information on both reserves and resources. The first audit of the ore reserves and mineral resources of OJSC Polyus Gold was performed by SRK Consulting in 2005. The audit included the analysis of a number of deposits in the Krasnoyarsk, Magadan and Irkutsk Regions. Since then, the Company has had its fields audited in accordance with the JORC standards on a regular basis upon completion of geological surveys and exploration work. Since 2006, the international audit of the Company’s deposits has been performed by Micon International. In 2010, the Company had the Verninskoye deposit audited according to the international standards. The Company’s total proved and probable reserves (P&P) amounted to 78.2 million ounces, and the total measured and indicated (M&I) mineral resources amounted to 84.8 million ounces. Mineral resources of the Company according to JORCMeasured, indicated and inferred resources
PROVED AND PROBABLE RESERVES
Mineral reserves and resources of the Company according to JORC
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
