Eurasia Mining PLC
('Eurasia' or 'the Company')
Appointment of Non-Executive Director and West Kytlim Update
The Board of Eurasia Mining plc is pleased to announce the appointment of Anthony James Nieuwenhuys as an non-executive director of the Company with immediate effect. James has held senior positions including Chief Operating Officer at Polyus Gold, and is currently Chief Executive Officer at South African Lesego Platinum Mining Limited. James has also held senior positions at a number of other key EPC organisations, so the directors believe that the appointment of Mr. Nieuwenhuys will be a great addition to the board.
In the Company's announcement of 16th September 2019, it was noted that the appointment of Mr. Nieuwenhuys to the board would only occur if a potential transaction with Lesego Platinum was to progress. The Company would like to reiterate that there has been a change of approach at board level, and at this stage, there is no intention to enter into any arrangement with Lesego, although both companies continue to keep this under review. Instead, the Directors believe that the experience of Anthony and his contacts, especially among PGM and gold producers in Russia, China and South Africa, could be beneficial for the Company as it continues to explore potential options for the Company's assets including a potential sale of the Company's mining assets. However, as previously stated, there can be no guarantee that any transaction, with any party, will occur.
The details required pursuant to the AIM Rules for Companies, in relation to this announcement, are set out below.
West Kytlim Update
In the meantime, the Company is pleased to provide an update on its operations at West Kytlim.
· Due to delays and inconsistencies by the original contractor at West Kytlim only 66kg (2,122 oz) of platinum has been approved by authorities as the maximum approved production limit for production in 2019, thus only this volume of platinum could be produced. The amounts of the other metals (palladium, iridium, rhodium and gold) remain to be tallied and are to be finalised with the revenue from the Refinery for these metals payable on schedule by the end of this year. Further updates on this will be provided as appropriate.
· The state approval on the second Kluchiki deposit reserves calculation as well as definitive feasibility study was received as expected, with final confirmation received as official board meeting minutes from the Urals Reserves commission on 13th September 2019. These previously announced additional reserves at the Kluchiki area are now fully permitted for mining.
· Metal grades and stripping ratio in the 2019 season were on the same level as in the 2018 season. The production volumes were impacted by the approved production limit due to the late start caused by a few delays by the original contractor, speeding up the decision to shift from contractor operation to Eurasia's own operation.
· The Company continued mining at site until all reserves the above mentioned approved by the state for mining for the 2019 season had been mined out.
· To ensure sufficient available mineable material for the 2020 season the Company has taken measures to ensure the Bolshaya Sosnovka area will be available for mining. This area contains reserves previously approved as 748Kg (c. 24,000 oz) Raw Platinum (see RNS dated 22 April 2014 where the Bolshaya Sosnovka area is referred to as TK Area 1). A drilling program of 682.5m, inclusive of 192m of larger diameter verification drilling was completed at this area during 2019 and was designed to bring these reserves to mineable status with approval to be sought over the winter period in accordance with the applicable laws. This should allow the Company to start mining at Kluchiki, and enable it to stockpile the ore until such time as the processing season starts (with the processing anticipated to start in March 2020). Mining at Bolshaya Sosnkova should commence thereafter.
· The Kluchiki reserves which are already available are in addition to those at the Bolshaya Sosnovka area.
· Eurasia is fully financed to start the 2020 season without contractors using its own equipment keeping all margins and positive effects from PGM prices.
· Finally, as previously announced the necessary gravel washing equipment and peripherals were purchased during the 2019 season. Further equipment including excavators, trucks and bulldozers were leased to maintain steady state delivery of ore to the washplant. Discussions with leasing companies and banks are now progressing at subsidiary level, to establish the best means of capitalising the necessary machinery for the 2020 season and beyond. Eurasia is on schedule to start mining in January 2020 to stockpile the ore for enrichment going forward once the processing season starts.
Christian Schaffalitzky, Chairman commented: "Through the final days of this season at West Kytlim we tested running the mine using our own team without the contractor, having purchased the necessary equipment from operating cashflow. 2019 has proven to be yet another important year for the Project and the Company is now operating the West Kytlim mine on a 100% of revenue basis. This represents a step change in our development and a 3-fold increase from our previous share of revenue that varied from 30% to 35% and is now 100%. It has taken some years to get to this point. We are now taking control of the established mine and have the necessary people and machinery in place to run it. Contracting in the early years was necessary to build our own team on the ground, however it resulted in relying on potentially unsustainable production due to the contractor's own priorities. We are happy to be in full control now.
The Directors are also happy to welcome Mr. Nieuwenhuys to the board. At this exciting time in the development of the Company it is valuable to expand our team to include industry professionals with relevant contacts."
A list of Mr. Nieuwenhuys' current directorships together with those held within the last five years is set out below:
Lesego Platinum Mining Ltd
Kopang Gold Mining Company
GV Gold (Vysochaishy, PJSC )
Nicolor Empowerment Company, Subsidiary of Tau Lekoa Mine
Previous Directorships/Partnerships over previous 5 years
Polyus Gold International Limited
Kopanang Empowerment Company (RF)
Lesego Empowerment Company (RF)
SNC-Lavalin South Africa
Village Main Reef Empowerment Company
B E Morgan Associates
Khumo Mining and Investments
Sweet Sensation 79
Mr. Nieuwenhuys (aged 55) does not own any shares in the Company and has confirmed that there is no further information to be disclosed pursuant to paragraph (g) of Schedule 2 of the AIM Rules.
Eurasia Mining Plc
Christian Schaffalitzky/ Keith Byrne
+44 (0)207 932 0418
WH Ireland Limited (Nomad and Joint Broker)
Katy Mitchell / James Sinclair-Ford
+44 (0)161 832 2174
First Equity Limited (Joint Broker)
Tel: +44 (0)20 7374 2212
Optiva Securities (Joint Broker)
Tel: +44 (0) 20 3137 1902
Shareholders are encouraged to follow the non-regulatory progress at the mine site through the Company's media channels including:
About Eurasia Mining PLC (LSE: EUA)
Eurasia Mining is a long-established PGM and gold focused production company quoted on the London Stock Exchange AIM market, with an operating PGM mine in the Ural Mountains. In addition, Eurasia maintain an interest in the Semonovsky Gold in Mine Tailings Project, an asset demonstrating potentially low-cost new-term gold production potential.
Eurasia's two core projects are:
The West Kytlim operating mine (of which the Company owns 68%), which is the largest alluvial platinum reserve in the world currently, with 2,283 kilograms of raw platinum in reserves, and resources and resource potential (as an unapproved internal calculation) to a further 10 tonnes of raw platinum. A single washplant has operated on site during 2018 and 2019, with further increases in production planned from multiple washplants as and when feasiblie. The mine was previously contracted to generate cashflow from which to finance further capitalisation of the asset. All contractors were retired from the operation in September 2019 and it is intended the mine operate on an owner operated (100% of revenue) basis from 2020.
The Monchetundra Project (of which the Company owns 80%), has state approved reserves and resources of ca 2 million ounces of palladium equivalent (predominantly palladium, and includes 28,124 tonnes of copper and 30,410 tonnes of nickel), before metal recoveries and all costs. Eurasia has in place (signed October 2016) an EPCF (Engineering Procurement Construction and Financing) contract with Sinosteel, a state-owned Chinese corporation focused on mining. This agreement fully finances the Project through building of the 1.7m tonnes per annum processing facility at the Monchetundra Project. This financing contract can be drawn down at the option of the Company, and to date the Company has not activated this option.