Polymetal sees reserves fall in 2011

Russia-focused mining firm Polymetal saw its proved and probable gold equivalent reserves fall by a tenth during 2011, as a result of reserve depletion.

As of January 1st 2012, gold equivalent ore reserves stood at 14.3Moz, down 10% on the 15.9Moz reported on the same date in 2011. The firm assures that the average resources grade remains high at 3.9 g/t of gold equivalent.

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Mineral resources of gold equivalent - accounting for indicated, measured and inferred resources - improved by 2% to 13.8Moz mainly due to the new resources added at its Dalneye deposit in the Omolon Regional Program.

The company said that its used conservative prices for precious metals for reserve estimation ($1,200/oz for gold and $20/oz for silver) and this leaves "substantial amounts of economically mineable material outside reserve estimates, particularly at Dukat mine."

"We expect that a modest reduction in Polymetal's ore reserves in 2011 will be more than reversed in 2012 as our exploration efforts translate into new significant reserve and resource additions,"said Vitaly Nesis, Chief Executive Officer of Polymetal.

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