Polymetal: Q3 2020 production results

 

Release time	IMMEDIATE                         LSE, MOEX, AIX: POLY / ADR: AUCOY
Date	22 October 2020

 

Polymetal International plc

Q3 2020 production results

 

Polymetal reports strong production results for the third quarter of 2020.

 

"In Q3 the Group continued to exceed production budget and generated massive cash flows on the back of a seasonal release of working capital", said Vitaly Nesis, Group CEO of Polymetal. "We remain vigilant and focused to protect our employees, contractors, and local communities as the COVID-19 pandemic remains a crucial risk for Polymetal".

HIGHLIGHTS

• There were no fatal accidents during the first nine months of 2020 either at Polymetal or at the Company's contractors. LTIFR among the Group's employees for the period stood at 0.10, a decrease of 47% year-on-year (y-o-y). There were 8 minor incidents in total in comparison with 15 incidents during 9M 2019.
• The Company's Q3 gold equivalent ("GE") production increased by 7% y-o-y to 477 Koz of GE driven by strong contributions from Omolon, Varvara, and Kyzyl. GE output for 9M 2020 months reached 1,200 Koz, an increase of 5% y-o-y.
• Q3 revenue jumped by 35% y-o-y to reach US$ 884 million on the back of higher gold and silver prices as well as increased sales volumes. 9M revenue amounted to US$ 2,019 million, up 26% y-o-y. The lag between gold production and sales, mainly at Varvara and Kyzyl, is expected to close in Q4 2020.
• Polymetal generated record quarterly free cash flow in Q3. Net debt was down by US$ 80 million to US$ 1.61 billion, even as the Company paid US$ 189 million of interim dividends (US$ 0.40 per share, a two-fold increase year-on-year).
• Construction and development activities at Nezhda and POX-2 progressed on schedule. COVID-related restrictions, precautionary measures and cases of the disease on site have not slowed down project execution.
• The Company is on track to meet its full-year 2020 production guidance of 1,500 Koz GE with COVID-related risks remaining the key source of uncertainty. TCC and AISC guidance of US$ 650-700/GE oz and US$ 850-900/GE oz respectively is also maintained.
• Production guidance for 2021 and 2022 of 1,500 Koz and 1,600 Koz GE respectively is reiterated.

 

•  

COVID-19 UPDATE

• There were 112 active cases of COVID-19 as at 20.10.2020 across the Group. Strict precautionary procedures, previously implemented, including 14-day mandatory isolation of new shifts and limitations on meetings and travel, are maintained at all production sites and offices. These restrictions are expected to continue at least into Q2 2021.
• Mayskoye suffered a C-19 outbreak in September. All infected persons and their contacts were transferred to observatory facilities or hospitals. Currently 18 people remain isolated on site and 8 are in hospital with 1 person in a serious condition. All mining and processing activities continued at regular pace.
• In September, Olcha underground and open pit (part of Omolon hub) returned to production after a 5-week stoppage caused by the COVID-19 outbreak. All people infected (approximately 50) have recovered. The stoppage is not expected to result in any production or cost downgrades.
• Russia is undergoing a second wave of the pandemic with daily infections above the previous peak levels seen in May. Some regions partially re-introduced restrictive measures. Kazakhstan lifted most of the quarantine restrictions in August following significant drops in the number of infected and intensive care admissions. The infection rates remain stable so far.
• At the same time, governments have relaxed a number of cross-border travel restrictions allowing flights between Russia, Kazakhstan and Belarus to resume. This has facilitated bringing Kazakh employees to Dukat and Mayskoye.
• Polymetal continues to provide varied financial and operational support to healthcare facilities across all regions of its presence with US$ 2.9 million spent so far in 2020. The main areas of assistance include purchasing PPE, medical supplies, and specialized diagnostic equipment.
• The Company estimates additional COVID-related cash expenses at approximately US$ 3 million per month with the bulk recorded as operating costs. This translates into approximately US$ 20 per GE ounce produced in Q3.

COVID-19 STATISTICS AS OF 20.10.2020

Employees	Russia	Kazakhstan	Group
Tests administered	17,491	8,108	25,599
C-19 positive tests	390	222	612
Active cases	99	13	112
In hospital	29	0	29

 

OPERATING HIGHLIGHTS

	3 months ended Sep 30,		% change1	9 months ended Sep 30,		% change1
	2020	2019		2020	2019
Waste mined, Mt	43.8	41.3	+6%	122.8	118.9	+3%
Underground development, km	21.0	25.9	-19%	67.4	80.2	-16%
Ore mined, Mt	4.2	4.5	-7%	12.2	13.0	-6%
Open-pit	3.1	3.4	-10%	9.1	9.9	-8%
Underground	1.1	1.1	+2%	3.1	3.1	-0%
Ore processed, Mt	4.0	3.9	+2%	11.8	11.5	+3%
Average GE grade processed, g/t	3.8	3.9	-2%	3.9	3.8	+3%
Production
Gold, Koz	438	402	+9%	1,080	1,005	+8%
Silver, Moz	4.6	5.4	-13%	14.4	16.4	-12%
Gold equivalent, Koz2	477	447	+7%	1,200	1,141	+5%
Sales
Gold, Koz	410	388	+6%	1,005	992	+1%
Silver, Moz	4.2	6.1	-31%	14.1	16.4	-14%
Revenue, US$m3	884	656	+35%	2,019	1,602	+26%
Net debt, US$m4	1,610	1,690	-5%	1,610	1,479	+9%
Safety5
LTIFR	0.15	0.11	+36%	0.10	0.19	-47%
Fatalities	0	0	NA	0	2	-100%
Notes: (1) % changes can be different from zero even when absolute numbers are unchanged because of rounding. Likewise, % changes can be equal to zero when absolute numbers differ due to the same reason. This note applies to all tables in this release.  (2) Based on 120:1 Au/Ag conversion ratio (prior to Q2 2020, Polymetal used 80:1 Au/Ag ratio) and excluding base metals (previously were included). Historical comparative data restated accordingly. (3) Calculated based on the unaudited consolidated management accounts. (4) Non-IFRS measure based on unaudited consolidated management accounts. Comparative information is presented for 30 June 2020 (for the three months period) and 31 December 2019 (for the nine months period). (5) LTIFR = lost time injury frequency rate per 200,000 hours worked.

PRODUCTION BY MINE

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
GOLD EQ. (KOZ)1
Kyzyl	102	94	+8%	314	253	+24%
Mayskoye	77	72	+7%	78	76	+2%
Albazino	65	75	-13%	204	211	-3%
Omolon	65	47	+40%	153	142	+8%
Dukat	48	51	-7%	152	159	-5%
Varvara	46	34	+35%	130	104	+25%
Svetloye	39	46	-15%	91	107	-15%
Voro	35	28	+24%	77	84	-9%
TOTAL (continuing operations)	477	447	+7%	1,200	1,138	+6%
Kapan	-	-	NA	-	3	-100%
TOTAL (including discontinued operations)	477	447	+7%	1,200	1,141	+5%

Notes: (1) Based on 120:1 Au/Ag conversion ratio (prior to Q2 2020, Polymetal used 80:1 Au/Ag ratio) and excluding base metals (previously were included). Historical comparative data restated accordingly.

 

 

CONFERENCE CALL AND WEBCAST

Polymetal will hold a conference call and webcast on Thursday, 22 October 2020 at 11:00 London time (13:00 Moscow time).

To participate in the call, please dial:

From the UK:

+44 330 336 9125 (local access)

0800 358 6377 (toll free)

From the US:

+1 929 477 0324 (local access)

800 289 0571 (toll free)

From Russia:

+7 495 213 1767 (local access)

8 800 500 9283 (toll free)

To participate from other countries, please dial any of the local access numbers listed above.

Conference code: 9476909

To participate in the webcast follow the link: https://webcasts.eqs.com/polymetal20201022.

Please be prepared to introduce yourself to the moderator or register.

A recording of the call will be available at +44 207 660 0134 (from the UK), +1 719 457 0820 (from the USA) and 8 10 800 2702 1012 (from Russia), access code 9476909, from 16:30 Moscow time Thursday, 22 October, till 16:30 Moscow time Thursday, 29 October 2020. Webcast replay will be available on Polymetal website (www.polymetalinternational.com) and at https://webcasts.eqs.com/polymetal20201022.

About Polymetal 

Polymetal International plc (together with its subsidiaries - "Polymetal", the "Company", or the "Group") is a top-10 global gold producer and top-5 global silver producer with assets in Russia and Kazakhstan. The Company combines strong growth with a robust dividend yield.

Enquiries

Media		Investor Relations
FTI Consulting Leonid Fink Viktor Pomichal	+44 20 3727 1000	Polymetal Evgeny Monakhov Timofey Kulakov Kirill Kuznetsov	[email protected] +44 20 7887 1475 (UK)   +7 812 334 3666 (Russia)
Joint Corporate Brokers
Morgan Stanley & Co. International plc Andrew Foster Richard Brown Panmure Gordon Daniel Norman John Prior	+44 20 7425 8000         +44 20 7886 2500	RBC Europe Limited Marcus Jackson Jamil Miah	+44 20 7653 4000

 

 

 

Forward-looking statements

This release may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements speak only as at the date of this release. These forward-looking statements can be identified by the use of forward-looking terminology, including the words "targets", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could" or "should" or similar expressions or, in each case their negative or other variations or by discussion of strategies, plans, objectives, goals, future events or intentions. These forward-looking statements all include matters that are not historical facts. By their nature, such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the company's control that could cause the actual results, performance or achievements of the company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the company's present and future business strategies and the environment in which the company will operate in the future. Forward-looking statements are not guarantees of future performance. There are many factors that could cause the company's actual results, performance or achievements to differ materially from those expressed in such forward-looking statements. The company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based.

 

 

KYZYL

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Waste mined, Mt	20.0	17.5	+14%	58.0	49.9	+16%
Ore mined (open-pit), Kt	513	527	-3%	1,555	1,560	-0%
PROCESSING
Ore processed, Kt	509	502	+1%	1,515	1,490	+2%
Gold grade, g/t	7.4	7.5	-1%	8.0	7.0	+14%
Gold recovery	89.0%	88.3%	+1%	87.8%	87.7%	+0%
Concentrate produced, Kt	37.2	31.4	+18%	110.2	89.7	+23%
Concentrate gold grade, g/t	90.6	104.8	-14%	96.4	101.7	-5%
Gold in concentrate, Koz1	108.2	105.9	+2%	341.3	293.3	+16%
Concentrate shipped, Kt	21.1	17.2	+22%	68.3	54.2	+26%
Payable gold shipped, Koz	40	36	+11%	132	127	+4%
Veduga ore toll processed, Kt2	-	-	NA	31	-	NA
Amursk POX
Concentrate processed, Kt	15	15	-3%	44	35	+24%
Gold grade, g/t	147.8	125.9	+17%	143.8	125.3	+15%
Gold recovery	92.6%	91.7%	+1%	92.1%	92.9%	-1%
Gold produced, Koz	62	58	+6%	183	126	+44%
TOTAL PRODUCTION
Gold, Koz	102	94	+8%	314	253	+24%

Note: (1) For information only; not considered as gold produced and therefore not reflected in the table representing total production. It will be included in total production upon shipment to off-taker or dore production at Amursk POX.

(2) To be further processed at Amursk POX.

Kyzyl production for Q3 increased by 8% y-o-y to 102 Koz on the back of higher grades in the open pit. Grades will continue to normalize towards reserve average (6.7 g/t) as mining progresses to lower levels where small high-grade lenses are significantly less usual.

Recoveries at the concentrator improved by 1 percentage point thanks to continuous optimization of reclaim water quality. Investment in additional thickening and drying capacity is expected to enable stable recoveries despite the introduction of higher-carbon, more refractory ore in 2021.

MAYSKOYE

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Waste mined, Mt	0.6	1.4	-55%	2.3	4.0	-41%
Underground development, km	4.9	4.7	+3%	15.9	15.5	+2%
Ore mined, Kt	289	199	+45%	855	638	+34%
Open-pit	91	41	+123%	278	175	+59%
Underground	197	159	+24%	578	463	+25%
PROCESSING
Ore processed, Kt	225	232	-3%	683	658	+4%
Gold grade, g/t	7.9	6.3	+24%	6.8	6.2	+9%
Gold recovery	70.9%	84.7%	-16%	81.1%	79.5%	+2%
Gold in concentrate, Koz2	29	36	-21%	104	95	+10%
Gold produced in dore from carbon, Koz3	2	1	+42%	3	6	-55%
Payable gold in concentrate shipped to offtakers, Koz	75	70	+6%	75	70	+6%
TOTAL PRODUCTION
Gold, Koz	77	72	+7%	78	76	+2%

Notes:  (1) To concentrate.

(2) For information only; not considered as gold produced and therefore not reflected in the table representing total production. Included in total production upon sale to off-taker or dore production at Amursk POX.

(3) Gold produced from carbon at Amursk POX.

At Mayskoye, larger volumes of oxide ore were processed in Q3 compared to the previous year which resulted in higher grades and lower recoveries.

The Company decided to continue open-pit mining through another pushback at Zone 1. The management believes that the pushback will create substantial value in the current gold price environment. In addition, open-pit ore tonnage will reduce risks at the underground mine where development for the new material handling system (electric conveyor replacing diesel trucks) has started.

Shipment of concentrate to China has commenced in August. Chinese off-take market remains strong with substantial demand from new customers.

 

ALBAZINO

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Waste mined, Mt	5.2	5.7	-8%	15.1	16.8	-10%
Underground development, km	2.5	2.9	-12%	8.7	7.7	+13%
Ore mined, Kt	421	571	-26%	1,401	1,596	-12%
Open-pit	249	418	-40%	905	1,184	-24%
Underground	172	153	+12%	497	412	+21%
PROCESSING
Albazino concentrator
Ore processed, Kt	429	447	-4%	1,320	1,303	+1%
Gold grade, g/t	4.7	4.8	-4%	4.6	4.4	+5%
Gold recovery1	88.4%	86.9%	+2%	86.8%	85.9%	+1%
Concentrate produced, Kt	34.9	36.8	-5%	107.6	106.0	+2%
Concentrate gold grade, g/t	50.3	51.0	-1%	49.5	46.6	+6%
Gold in concentrate, Koz2	56	60	-6%	171	159	+8%
Amursk POX
Concentrate processed, Kt	41	45	-9%	126	135	-6%
Gold grade, g/t	49.2	51.2	-4%	51.5	50.5	+2%
Gold recovery	96.5%	96.5%	-0%	96.5%	95.2%	+1%
Gold produced, Koz	65	75	-13%	204	211	-3%
TOTAL PRODUCTION
Gold, Koz	65	75	-13%	204	211	-3%

Notes: (1) To concentrate.

 (2) For information only; not considered as gold produced and therefore not reflected in the table representing total production. Included in total production after Dore production at the Amursk POX.

At Albazino, quarterly gold production was down 13% y-o-y to 65 Koz driven by lower grade and throughput. The Anfisa open pit, long the mainstay of ore production, is nearing its depletion in early 2022.

Gold recovery at the concentrator improved by 2 p.p. y-o-y as the operating team tweaked the reagent addition rates to cope with higher quantities of complex ore from Ekaterina-2.

Underground development declined significantly due to challenging geotechnical conditions at deeper levels of the Olga underground mine. Permanent downgrade to underground mine productivity led to the decision to cancel plans to double the size of the underground mine. Production shortfall will be compensated largely by the recently approved Kutyn heap leach project. Kutyn will be developed as part of the Albazino hub with first gold pour expected in Q2 2023.

 

AMURSK POX

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
Concentrate processed, Kt	56	60	-7%	170	171	-0%
Albazino	40	41	-3%	119	122	-3%
Kyzyl	15	15	-3%	44	35	+24%
Veduga	-	3	-100%	3	9	-67%
Other1	1	-	NA	4	4	+17%
Gold recovery	94.5%	94.3%	+0%	94.3%	94.3%	-0%
Average gold grade, g/t	75.5	70.3	+7%	75.3	66.0	+14%
Average sulphur grade	14.4%	12.5%	+15%	14.1%	12.8%	+10%
Total gold produced2, Koz	127	133	-5%	387	338	+15%
Albazino	65	62	+3%	176	178	-2%
Kyzyl	62	58	+6%	183	126	+44%
Veduga	-	12	-100%	19	28	-33%
Other1	0	0	-3%	10	5	+112%

Notes: (1) Purchased concentrates which are included in reportable production in the Albazino segment.

           (2) For information only. Already accounted for in production at operating mines.

Gold production for the quarter at the Amursk POX decreased by 5% y-o-y to 127 Koz due to the absence of concentrate from Veduga ore.

The facility successfully underwent a regular 2-week maintenance shutdown in early October.

 

 

OMOLON OPERATIONS

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Waste mined, Mt	0.7	1.9	-63%	2.8	5.1	-46%
Underground development, Km	3.1	3.3	-7%	10.0	9.9	+2%
Ore mined, Kt	607	805	-25%	2,171	2,183	-1%
Open-pit	497	690	-28%	1,828	1,849	-1%
Underground	110	115	-4%	344	334	+3%
PROCESSING
Kubaka Mill
Ore processed, Kt	214	184	+16%	648	612	+6%
Grade
Gold, g/t	7.1	6.0	+19%	6.9	6.3	+8%
Silver, g/t	28	132	-79%	22	90	-75%
Recovery1
Gold	95.0%	95.8%	-1%	93.8%	95.5%	-2%
Silver	73.0%	80.8%	-10%	73.8%	79.5%	-7%
Gold production, Koz	49	33	+49%	132	119	+10%
Silver production, Moz	0.1	0.6	-76%	0.3	1.4	-76%
Birkachan Heap Leach
Ore stacked, Kt	411	350	+17%	1,118	897	+25%
Gold grade, g/t	1.6	1.2	+33%	2.0	1.2	+71%
Gold production, Koz	15	9	+67%	18	11	+67%
TOTAL PRODUCTION
Gold, Koz	64	42	+53%	150	130	+15%
Silver, Moz	0.2	0.6	-70%	0.4	1.4	-74%

Note: (1) Technological recovery, includes gold and silver within work-in-progress inventory.

At Omolon, gold output for the quarter jumped by 53% y-o-y while silver production was down 70%. Kubaka mill processed gold-rich ore from Birkachan underground and Yolochka through the CIP circuit as opposed to Sopka ore with higher silver content though the Merrill-Crowe circuit in 2019. Heap leach production positively contributed to the total output on the back of stacking of larger volumes of higher-grade ore stockpiles.

Open-pit mining was down as Birkachan and Olcha pits are nearing end of mining in Q4 2020.  Preparations have started to commence open-pit mining at the new satellite deposit, Burgali, in Q2 2021.

 

DUKAT OPERATIONS

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Underground development, km	10.6	15.0	-30%	32.8	45.0	-27%
Ore mined, Kt	614	642	-4%	1,698	1,894	-10%
PROCESSING
Omsukchan concentrator
Ore processed, Kt	493	506	-3%	1,502	1,535	-2%
Grade
Gold, g/t	0.5	0.5	-3%	0.5	0.5	-1%
Silver, g/t	258	282	-9%	273	291	-6%
Recovery1
Gold	84.7%	86.7%	-2%	84.8%	86.1%	-1%
Silver	86.6%	86.8%	-0%	86.6%	86.8%	-0%
Production
Gold, Koz	7	7	-5%	21	22	-2%
Silver, Moz	3.5	3.9	-9%	11.2	12.1	-8%
Lunnoye plant
Ore processed, Kt	116	116	+0%	348	348	+0%
Grade
Gold, g/t	1.3	1.4	-5%	1.4	1.4	+1%
Silver, g/t	265	241	+10%	271	258	+5%
Recovery1
Gold	88.3%	91.4%	-3%	90.3%	87.6%	+3%
Silver	93.1%	94.5%	-1%	92.4%	91.5%	+1%
Production
Gold, Koz	4	5	-9%	14	14	+2%
Silver, Moz	0.9	0.9	+4%	2.8	2.7	+3%
TOTAL PRODUCTION
Gold, Koz	11	12	-6%	35	36	-1%
Silver, Moz	4.4	4.7	-7%	13.9	14.8	-6%

Notes: (1) Technological recovery, includes gold and silver within work-in-progress inventory.

At Dukat, silver grade decreased y-o-y resulting in production being down by 7% to 4.4 Moz. At the same time, the mine exceeded the budget grade on the back of lower than expected dilution enabled by expanding usage of smaller equipment and narrower mining widths.

Underground development volumes declined materially following the decommissioning of the Goltsovoye underground mine.

In response to material silver price growth, lower-grade areas at Dukat will be systematically re-evaluated to identify potentially economic stopes which were left behind in the period of lower silver prices. 

 

 

VARVARA

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Waste mined, Mt	10.1	11.4	-12%	30.3	34.1	-11%
Ore mined, Kt	725	1,014	-29%	2,209	2,953	-25%
PROCESSING
Leaching
Ore processed, Kt	773	733	+6%	2,303	2,268	+2%
Gold grade, g/t	1.4	1.6	-12%	1.4	1.5	-2%
Gold recovery1	88.1%	87.4%	+1%	88.1%	86.8%	+1%
Gold production (in dore), Koz	32	31	+1%	99	97	+2%
Flotation
Ore processed, Kt	176	134	+31%	493	411	+20%
Grade
Gold, g/t	3.2	1.3	+139%	3.0	1.2	+150%
Copper	0.33%	0.49%	-33%	0.33%	0.53%	-37%
Recovery1
Gold	88.7%	69.5%	+28%	87.4%	78.4%	+11%
Copper	84.2%	91.3%	-8%	84.6%	91.4%	-7%
Production
Gold (in concentrate), Koz	14	3	+418%	32	7	+340%
Copper (in concentrate), Kt	0.5	0.6	-10%	1.3	1.8	-29%
Veduga ore toll processed, Kt2	-	35	-100%	30	98	-70%
Total ore processed, Kt	949	902	+5%	2,825	2,778	+2%
TOTAL PRODUCTION
Gold, Koz	46	34	+35%	130	104	+25%
Copper, Kt	0.5	0.6	-10%	1.3	1.8	-29%

Note: (1) Technological recovery, includes gold and copper within work-in-progress inventory. Does not include toll-treated ore.

(2) To be further processed at Amursk POX.

Varvara demonstrated strong gold production y-o-y increase of 35% to 46 Koz in Q3 and 25% to 130 Koz in 9M driven by larger volumes of high-grade third-party ore through the flotation circuit and better recoveries attributable to the flow sheet improvements.

Average gold grade in ore processed at the leaching circuit was down 12% y-o-y on the back of planned decrease of gold grade at Komar.

 

SVETLOYE

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Waste mined, Mt	0.7	0.3	+115%	2.3	1.1	+108%
Ore mined (open pit), Kt	547	406	+35%	1,454	1,273	+14%
PROCESSING
Ore stacked, Kt	395	369	+7%	1,021	968	+5%
Gold grade, g/t	4.0	4.1	-4%	4.0	4.0	-0%
Gold production, Koz	39	46	-15%	91	107	-15%
TOTAL PRODUCTION
Gold, Koz	39	46	-15%	91	107	-15%

At Svetloye, quarterly gold production decreased by 15% y-o-y to 39 Koz as larger volumes of ore from the Emmy pit with lower recoveries and slower kinetics were stacked.

VORO

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Waste mined, Mt	-	0.4	-100%	-	1.2	-100%
Ore mined, Kt	132	181	-27%	239	661	-64%
PROCESSING
Voro CIP
Ore processed, Kt	257	264	-3%	786	783	+0%
Gold grade, g/t	2.0	4.0	-50%	2.1	3.7	-42%
Gold recovery1	83.2%	87.0%	-4%	82.6%	86.6%	-5%
Gold production, Koz	27	26	+1%	63	71	-12%
Voro Heap Leach
Ore stacked, Kt	-	58	-100%	22.2	58	-62%
Gold grade, g/t	-	1.4	-100%	0.9	1.4	-35%
Gold production, Koz	8	2	+410%	14	13	+10%
TOTAL PRODUCTION
Gold, Koz	35	28	+24%	77	84	-9%

Note: (1) Technological recovery, includes gold within work-in-progress inventory.

In Q3, Voro saw an increase in production of 24% y-o-y to 35 Koz due to work-in-progress release at both CIP and heap leach facilities. Production from the current operations was down y-o-y as CIP turned to processing lower-grade stockpiles after mining was completed in 2020.

DEVELOPMENT UPDATE

At Nezhda, mining and construction activities have been progressing on schedule. Installation of flotation and gravity concentration equipment is completed. New boiler house was commissioned with permanent heating established in all buildings including the concentrator. ROM ore crusher and crushed ore reclaim feeders installed. The installation of pylons for the external grid power line commenced. Ore mining started.

 

	3 months ended Sep 30,		% change	9 months ended Sep 30,		% change
	2020	2019		2020	2019
MINING
Waste mined, Mt	4.7	-	NA	4.7	-	NA
Ore mined, Kt	200	-	NA	200	-	NA

POX-2 development proceeds on schedule. Construction is currently focused on POX and oxygen station buildings. The autoclave vessel has been successfully installed on its foundation in August. Oxygen plant has been delivered on site. Construction of downstream areas (CIL, desorption/electrolysis) commenced.

At Veduga, ore mining ceased in October with focus shifting to building the exploration decline and pre-stripping ahead of the potential approval of the project in 2021.

SUSTAINABILITY, HEALTH AND SAFETY

There were no fatal accidents during 9M 2020 within Polymetal and the Company's contractors. LTIFR for the reporting quarter grew by 36% y-o-y to 0.15 as 4 minor incidents were recorded in comparison with 3 minor incidents in Q3 2019. During the first 9 months of 2020 there were 8 minor work-related incidents in total, LTIFR stood at 0.10, a decrease of 47% y-o-y.

In Q3, the Company's leadership in ESG was reaffirmed by FTSE Rusell which maintained Polymetal as a constituent of FTSE4Good Index Series with 4.4 score (out of possible 5) and 92 percentile. Polymetal was also awarded Best Communication of ESG by IR Magazine.