Polymetal successfully produced its first gold and silver concentrate on Saturday at its Nezhda mine in Russia, two weeks ahead of schedule.
The London-listed mining company said in a news release on Monday that it will now ramp up production and expects to reach its intended full-load sustained output capacity and full design recovery by April 2022.
“The mine should ramp-up to full capacity and start generating free cash flows by Q2 2022,” said Vitaly Nesis, group CEO of Polymetal.
The company also said that it expects Nezhda to produce up to 30,000 gold-equivalent ounces in 2021 and 180,000 ounces a year in 2022-2024. The estimated AISC (all-in sustaining cost) is $850-$900 (£619-£655) an ounce.
Reducing greenhouse gas emissions
The project’s capital expenditure was around $370m.
Polymetal said a further production upside is linked to the opportunity of processing ore from the high-grade Prognoz silver deposit, owned entirely by the company.
“Starting from Q3 2022, 100% of energy for Nezhda will be sourced via the power line which is currently under construction. Grid connection will result in a 65% reduction of greenhouse gas emissions for Nezhda,” the statement added.
Job creation and taxes
The release also revealed that Nezhda will create more than 1,000 permanent jobs and generate more than $20m per year in taxes “for all levels of government”.
The company also highlighted that it has invested approximately $1.7m into various social projects in the region related to education, culture, sports, indigenous people and health, including $0.5m for Covid-19 preventive measures.
Polymetal shares were up 1.73% in early trade on Monday morning on the London Stock Exchange.