Russia’s Polymetal buys Kapan gold field for $50 mln

MOSCOW, Apr 28 (PRIME) -- Russian precious metals producer Polymetal International has bought Dundee Precious Metals Kapan, which owns a license for Armenia’s Kapan gold field, from Dundee Precious Metals Inc for U.S. $50 million, Polymetal said in a statement Thursday.

The company paid $10 million in cash and $15 million with an issue of 1,481,785 shares of the company. Dundee will also receive a 2% net smelter return royalty from future production at the field, but the royalty sum will not exceed $25 million, Polymetal said.

The company will announce short-term and long-term plans regarding the field in July–December. After the new shares are approved for trading at the London Stock Exchange on Saturday, the company’s shareholder equity will equal 426,233,460 shares.

Kapan’s estimated resources amounted to 15.9 million tonnes of ore with a content of gold at 1.4 million ounces, of silver at 24 million ounces, of copper at 80,000 tonnes and of zinc at 270,000 tonnes as of December 31, 2014. The assets of the field include a fully automated mine with a capacity of 400,000 tonnes a year, an ore dresser with capacity of 750,000 tonnes per year, and infrastructure facilities.

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