KazMinCo releases resource estimate for Samarskoye copper-gold deposit — Negotiations concluded for development terms and conditions

Based on the results of a prefeasibility drilling program totalling 27,000 metres, Kazakhstan Minerals (KMC.U-T) has reported a preliminary resource estimate for the Samarskoye porphyry deposit in central Kazakstan.

The resource estimate was performed by Mineral Resources Development Inc.

(MRDI), an independent consulting firm, which based its results on a drill program in which holes were spaced at between 60 and 80 metres.

Kazakhstan Minerals reports that the western and eastern mineralized bodies at Samarskoye are now estimated to total 197 million tonnes at 0.84% copper and 0.33 gram gold per tonne, based on a 0.4% copper cutoff grade.

To determine the relative profitability of underground and open-pit mining, MRDI completed a preliminary scoping study. The work identified an initial open-pit containing about 90 million tonnes that could support a daily production rate of between 20,000 and 30,000 tonnes.

KazMinCo recently negotiated an agreement with the government for development of the deposit over a 20-year period (extendable to 25 years). The company secured the right to refine overseas and export product. Net smelter royalties were set at 1% for copper and 1.2% for gold, and a waiver of duty and import tariffs was obtained for the life of the project.

KazMinCo holds an 88.5% interest in Samarskoye, which has been renamed the Nurkazgan deposit. The company hopes to complete the prefeasibility study for the copper-gold deposit by the third quarter. At this point, infill drilling for the final feasibility study will begin. Metallurgical test work is also planned.

The study will also examine the benefits of combining production from the nearby Northern Gold deposit, in which KazMinCo holds an 88.5% interest. The company has 10 active joint ventures with local partners in the country, including the Varvarinskoye gold-Copper deposit, which is also at the prefeasibility study stage.