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Amur Minerals offers two potential development scenarios for the Kun-Manie nickel sulphide deposit

Snapshot

  • Huge nickel resource in Russia
  • One of the world’s last sulphide deposits
  • Pre-feasibility studies offer two scenarios for economic extraction
  • Long track record of operating in Russia
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Quick facts: Amur Minerals Corporation

Price: 2.09 GBX

LSE:AMC
Market: LSE
Market Cap: £17.47 m
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What does Amur Minerals do?

Amur Minerals Corporation (LON:AMC) is a junior mining exploration company that holds assets in Russia. The company is run by long-standing chief executive Robin Young, who spends much of his time in Russia. Other directors, including Robert Schafer and Brian Savage also boast long years of experience in the mining industry.
 

 

What does Amur Minerals own?

The principle asset is the Kun-Manie nickel deposit in the Amur Oblast of Russia’s Far East. This project is one of the world’s last remaining unexploited nickel sulphide deposits, and also contains significant amounts of copper.

As it stands the JORC resource rings in at 155.1mln tonnes of ore grading 1.02% nickel equivalent for a total nickel equivalent tonnage of 1.58mln tonnes.
 

 

Plans for development

A prefeasibility study released in early 2019 showed that production is likely to come from four open pits and one underground operation. It’s envisaged that the overall mine life will be 15 years, although precisely how the ore is mined depends on which of the two options presented in the prefeasibility study is adopted.

Option one, known as the TS option, will cost less to develop but offers lower margins and a lower NPV. Option two, known as the FFS option, will cost more to develop, but will deliver significantly higher returns.

Under the TS option, post-tax free cashflow will amount to just over US$2bn.

Under the FFS option, post-tax free cashflow will amount to just under US$3bn.

 

Permanent conditions TEO

A permanent conditions TEO is a Russian feasibility study ultimately leading to the determination of reserves in accordance with Russian requirements. 

The study is being compiled by OOO Oreol (Oreol), with additional work to be completed by other licensed agencies under the direction of Oreol. 

Amur is will use the study to help with project design, operational permits and the construction of Kun-Manie and as part of the DFS for the mine.

 

 

Nickel a metal for the future

Chief executive Robin Young is confident that the future of nickel is bright. Nickel is a key component in the manufacture of batteries for electric vehicles. As well as that huge growth market it is also essential in steel manufacturing.

 

 

From the chief executive

"The PFS provides a robust review of Kun-Manie's value, scale and viability and it is our intention to explore further the strategic options that will enhance the company's continued development of the project,” says Young.

“We believe that it puts the company in a strong position and provides attractive economics to invite discussions with varied parties to strengthen our team and deliver production at Kun-Manie. Additionally, there is significant potential for further upside to this PFS, following the company's successful drill programme last year, which yielded a number of positive results including expansion of the mineral resource estimate and mine life. As a company, we are encouraged by the PFS and the further step it has created in positioning the project to attractive partners that will support Amur's goal of seeing Kun-Manie being developed further and value delivered to shareholders."

 

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Watch

Amur Minerals pre-feasibility study outlines potential for US$3bn in cash...

Amur Minerals Corporation (LON:AMC) has revealed details of a pre-feasibility study for its Kun-Manie nickel project in Russia’s Far East. The study outlines two production scenarios capable of processing six million tonnes of ore per annum. Amur CEO Robin Young tells Proactive London what...

on 02/26/2019

3 min read