The Asia Miner

JUL-SEP 2018

The ASIA Miner - Reporting Important Issues to Mining Companies in the Asia Pacific Region

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the asia miner • volume 15 • issue 3 36 AROUND THE REGION According to Indonesian media reports, the Indonesian Government intends to give the Tanjung Gunung and Sungailiat former mining areas a new lease of life as tourism special economic zones. Located on the eastern coast of Sumatra's Bangka Island, the two areas would become the next such zones in the Bangka-Belitung (Babel) Province a[er Tanjung Kelayang on Belitung Island, which is currently undergoing an accelerated development. Following the downturn of the mining industry in Bangka, which was one of the major econ=omic contributors to the Island, developing a healthy economic alternaঞve such as tourism, is deemed vital to the region's survival. Arief Yahya, Indonesia's minister of tourism, was quoted in the TTG Asia as saying that the economic development in Babel Province between 2012 and 2016 was relaঞvely stagnant with farming, forestry and fishery as the dominaঞng sectors, while mining declined from 15.4 per cent in 2012 to 12per cent 2016. During this ঞme, the transportaঞon sector was on the rise. "Babel has to transform its economy from mining to tourism, and this transformaঞon has to start from the commitment of its CEO (the governor) to become the agent of change", said Arief. According to reports, the Tanjung Gunung Tourism Resort developer, Pan Semujur Makmur, is invesঞng US$121.5 million in the preliminary development of the area, with plans to transform Tanjung Gunung into a business events desঞnaঞon. Meanwhile, the 273ha Sungailiat East Coast Tourism Resort plans to promote its beaches, and culture and religious tourism. Development plans include hotels, marine tourism, sports and agrotourism ameniঞes. Erzaldi Rosman Djohan, governor of Babel, said the regional government would also ease licensing processes and provide incenঞves for investors. Polymetal Internaঞonal has announced the start-up of the new Kyzyl mine in Kazakhstan ahead of schedule and below budget. Following the compleঞon of all construcঞon and commissioning acঞviঞes, Kyzyl has successfully produced first gold concentrate Quarter 2 of this year, with Polymetal achieving the start-up of the concentrator one quarter ahead of the original schedule that had been announced in 2014, and one month earlier compared with the January 2018 updated plan. Project Capex is expected to be approximately 3 per cent below the original US$325 million budget, inclusive of 62Mt of pre-stripping. Mining acঞviঞes have reached full design capacity with 315kt of ore stockpiled ahead of start-up. The grade control program demonstrated robust reconciliaঞon with the reserve model with both ore grade and gold contained tracking slightly above plan. First concentrate deliveries to off-takers are scheduled for the end of July, with Indonesia plans to turn old mine sites into tourism destinations Mills at Kyzyl Kyzyl delivers first concentrate production ahead of time shipments to the Amursk POX expected to commence in September. The Kyzyl concentrator now enters the three-month ramp-up period, a[er which it is expected to reach nameplate capacity of 150kt per month and recoveries of 86 per cent by October 2018. This year, Polymetal plans to produce 80koz of payable gold at Kyzyl, ramping up producঞon to 280koz in 2019 and 330koz therea[er at AISC of approximately US$ 500-550/oz. JORC-compliant gold reserves at Kyzyl are esঞmated at 7.3Moz at 7.7 g/t of gold. This supports a life-of-mine of 10 years for the open pit followed by further 14 years of underground mining. Addiঞonal JORC-compliant gold resources comprise 3.1Moz at 6.8 g/t indicaঞng strong potenঞal to further extend operaঞons. "Polymetal is delighted and proud to successfully complete the largest development project in the company's history ahead of ঞme and below budget", said Vitaly Nesis, Group CEO of Polymetal. "Significant cash flow and net income contribuঞons from Kyzyl should start in Q4 2018."

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