TIDMAMC
RNS Number : 7716Y
Amur Minerals Corporation
29 January 2014
29 January 2014
AMUR MINERALS CORPORATION
(AIM: AMC)
Metal Resources Extraction and Profits Tax Update
New legislation expected to positively impact Kun-Manie
operation
Amur Minerals Corporation ("Amur" or the "Company"), the nickel
copper sulphide exploration and development company focused on base
metal projects located in the far east of Russia, confirms that the
Mineral Resources Extraction Tax ("MRET") and Profits Tax ("PT")
have been passed into law by the Russian government effective from
1 January 2014. This reduction in both the MRET and the PT (draft
legislation announced 9 April 2013) will positively impact the
proposed operation at the Company's Kun-Manie project.
Highlights:
-- The newly defined MRET rate for non-ferrous metals has been
reduced from the standard flat 8% per year to the more favourable
rate structure as follows:
Zero tax for the first two years;
1.6% for the third and fourth years;
3.2% for the fifth and sixth years;
4.8% for the seventh and eighth years; and
6.4% for the ninth and tenth years.
8.0% thereafter.
The net impact could provide additional revenues from more than
8,300 tonnes of nickel and 2,300 tonnes of copper which the Company
would not have to forward to the Russian authorities. At the
current price of US$14,000 per tonne for nickel and US$7,000 per
tonne for copper, an additional US$100 million of gross revenue
could be recovered.
-- Historically and in the 2007 SRK Consulting Pre-feasibility
Study ("PFS"), the PT rate was 24%. Using the newly implemented tax
rates, we anticipate recovering a minimum of 50% of the additional
revenues obtained from the reduction in the MRET. Presently, the PT
for Amur Oblast will be implemented at a maximum rate of 0% for the
first five years and 10% for the next five years as enacted by the
Governor of Amur Oblast on 23 December 2013. The Federal portion of
the PT consisted of 2%, which has now been waived by the
government.
Amur Minerals continues its review of the planned operation at
Kun-Manie; internally compiled trade-off studies have and are being
undertaken to optimise the planned operation. Results will be
released as and when appropriate. The information presented in the
above announcement is considered preliminary. The plans for
Kun-Manie will be updated to reflect all of the new information and
redesign of the operation.
Robin Young, CEO of Amur Minerals Corporation, commented:
"The Board is pleased to announce that the investment incentives
signed into law are indeed improving the investment environment in
Russia as well as the potential of the project. These newly
implemented regulations remove some of the financial risk
associated with the development of a natural resource project as
large as ours and should serve to encourage additional foreign
investment in the region. Amur has been supportive in the
implementation of incentives such as this as we continue to work to
obtain the mining rights to Kun-Manie and assess technical
alternatives to optimise the planned operation."
Enquiries:
Company Nomad and Broker Public Relations
Amur Minerals S.P. Angel Corporate Yellow Jersey
Corp. Finance LLP
Robin Young Ewan Leggat Dominic Barretto
CEO Laura Littley Kelsey Traynor
+44 (0) 7981 +44 (0) 20 3463 +44 (0) 77 6853
126 818 2260 7739
Notes to Editors
Additional information on the Company and the Kun-Manie Project
is available on the Company's website, www.amurminerals.com.
The information contained in this announcement has been reviewed
and approved by the CEO of Amur, Robin Young. Mr. Young is a
Geological Engineer (cum laude) and is a Qualified Professional
Geologist, as defined by the Toronto and Vancouver Stock
Exchanges.
Additional Information on the New Legislation
Organisations or companies qualifying for the new tax incentives
must invest a minimum level of capital to qualify for the
incentives. These include:
-- No less than 50 million roubles (approximately US$1.5
million) in the first three years after a taxpayer is registered as
an investment project participants; or
-- No less than 500 million roubles (approximately US$15.4 million) in the first five years.
Capital expenditures may also include the cost of performing
design and survey work, new construction, upgrading of existing
fixed assets, reconstruction of buildings, and the acquisition of
machinery, equipment, tools, and inventory. Costs incurred prior to
registration as a participant in a regional investment project are
not included in the acceptable minimum level of capital
investment.
A newly created category of taxpayer is defined as "participants
in regional investment projects," and a register of such
participants will be maintained. Registration of participants in
the register and other related procedures are provided within the
newly signed Tax Code.
The new tax incentive programme came into force 1 January 2014
and will expire 1 January 2029.
Discussion on the Project
The Kun-Manie exploration licence area is approximately 950
km(2) and is located 700 km northeast of the city of
Blagoveshchensk located on the Chinese border. Amur commenced
seasonal fieldwork on the licence area in 2004 and issued a JORC
compliant statement covering five deposits that have identified
resources from drilling, located along the prolific Kurumkon Trend.
The trend is wholly located within the licence boundary.
The five deposits contain a total Measured, Indicated and
Inferred resource of 120.8 million tonnes averaging 0.54% nickel
and 0.15% copper. The total contained tonnage of nickel is
estimated to be 650,600 tonnes with copper being 178,400 tonnes.
This equates to 1.4 billion pounds of contained nickel and 0.4
billion pounds of copper. A total of 16.9 tonnes of platinum and
18.0 tonnes of palladium are also present as by product metals. A
total nickel equivalent is indicated to be 830,000 tonnes using 2
December 2013 metal prices. Metal prices utilised to determine the
nickel equivalent value were US$13,378 per tonne for nickel,
US$7,009 per tonne for copper, US$1,350 per ounce for platinum and
US$714 per ounce for palladium.
JORC Resource Estimate - 2 December 2013
(at zero cut off grade)
Orebody Tonnage Ni Ni Cu Cu Pt Pt Pd Pd
Mt % t % t g/t kg g/t kg
================= ======== ===== ======== ===== ======== ==== ======= ===== =======
Kubuk
Measured - - - - - - - - -
Indicated - - - - - - - - -
Subtotal - - - - - - - - -
Inferred 20.6 0.58 118,900 0.16 32,900 0.1 3,000 0.1 2,400
Total 20.6 0.58 118,900 0.16 32,900 0.1 3,000 0.1 2,400
Gorny
Measured - - - - - - - - -
Indicated - - - - - - - - -
Subtotal - - - - - - - - -
Inferred 7.6 0.31 23,900 0.09 7,000 0.2 1,600 0.2 1,900
Total 7.6 0.31 23,900 0.09 7,000 0.2 1,600 0.2 1,900
Ikenskoe
Measured 14.9 0.52 77,100 0.13 19,700 0.2 2,700 0.2 3,000
Indicated 7.7 0.39 29,800 0.10 7,800 0.1 1,100 0.2 1,300
Subtotal 22.6 0.47 106,900 0.12 27,500 0.2 3,800 0.2 4,300
Inferred 11.5 0.62 70,800 0.14 16,300 0.2 2,300 0.2 2,500
Total 34.1 0.52 177,700 0.13 43,800 0.2 6,100 0.2 6,800
Vodorazdelny
Measured 0.8 0.57 4,700 0.17 1,400 0.3 200 0.3 200
Indicated 4.8 0.66 31,200 0.17 8,200 0.1 600 0.1 600
Subtotal 5.6 0.64 35,900 0.17 9,600 0.1 800 0.1 800
Inferred - - - - - - - - -
Total 5.6 0.64 35,900 0.17 9,600 0.1 800 0.14 800
Maly Krumkon
Measured - - - - - - - - -
Indicated 21.8 0.58 126,100 0.16 34,900 0.1 2,400 0.1 3,000
Subtotal 21.8 0.58 126,100 0.16 34,900 0.1 2,400 0.1 3,000
Inferred 31.1 0.54 168,100 0.16 50,200 0.1 3,000 0.1 3,100
Total 52.9 0.56 294,200 0.16 85,100 0.1 5,400 0.1 6,100
Total Measured 15.8 0.52 81,800 0.13 21,100 0.2 2,900 0.2 3,200
Total Indicated 34.3 0.55 187,100 0.15 50,900 0.1 4,100 0.1 4,900
Sub-total 50.1 0.54 268,900 0.14 72,000 0.1 7,000 0.1 8,100
Total Inferred 70.7 0.54 381,700 0.15 106,400 0.1 9,900 0.1 9.900
Grand Total 120.8 0.54 650,600 0.15 178,400 0.1 16,900 0.1 18,000
----------------- -------- ----- -------- ----- -------- ---- ------- ----- -------
The Company is conducting technical work to update previous
technical studies and facilitate issuance of the final reserve
statement based on the above resources. This will incorporate
updated capital and operating costs, the higher metallurgical
recoveries derived in 2012 by SGS Minerals, and lower net profits
tax and royalties. Work includes assessing alternative power
generation options, road design considerations and alternative
considerations such as heavy lift zeppelins, the potential of
generating near final marketable product on site and the
determination of specific metallurgical test work required to
establish the final operational design. The anticipated cost of the
development of Kun-Manie would qualify the Company to be a
participant as a "participant in the regional investment projects"
and is already included as a key project within the Far East
Development programme in Russia. The Company intends to register
with the appropriate agencies to be a full participant of the
programme and to benefit from the tax incentive statutes.
Glossary
DEFINITIONS OF EXPLORATION RESULTS, RESOURCES & RESERVES
EXTRACTED FROM THE JORC CODE: (December 2012) (www.jorc.org)
A 'Mineral Resource' is a concentration or occurrence of
material of intrinsic economic interest in or on the Earth's crust
in such form, quality and quantity that there are reasonable
prospects for eventual economic extraction. The location, quantity,
grade, geological characteristics and continuity of a Mineral
Resource are known, estimated or interpreted from specific
geological evidence and knowledge. Mineral Resources are
sub-divided, in order of increasing geological confidence, into
Inferred, Indicated and Measured categories.
An 'Inferred Mineral Resource' is that part of a Mineral
Resource for which tonnage, grade and mineral content can be
estimated with a low level of confidence. It is inferred from
geological evidence and assumed but not verified geological and/or
grade continuity. It is based on information gathered through
appropriate techniques from locations such as outcrops, trenches,
pits, workings and drill holes which may be limited or of uncertain
quality and reliability.
An 'Indicated Mineral Resource' is that part of a Mineral
Resource for which tonnage, densities, shape, physical
characteristics, grade and mineral content can be estimated with a
reasonable level of confidence. It is based on exploration,
sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits,
workings and drill holes. The locations are too widely or
inappropriately spaced to confirm geological and/or grade
continuity but are spaced closely enough for continuity to be
assumed.
A 'Measured Mineral Resource' is that part of a Mineral Resource
for which tonnage, densities, shape, physical characteristics,
grade and mineral content can be estimated with a high level of
confidence. It is based on detailed and reliable exploration,
sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits,
workings and drill holes. The locations are spaced closely enough
to confirm geological and/or grade continuity.
An 'Ore Reserve' is the economically mineable part of a Measured
and/or Indicated Mineral Resource. It includes diluting materials
and allowances for losses which may occur when the material is
mined. Appropriate assessments and studies have been carried out,
and include consideration of and modification by realistically
assumed mining, metallurgical, economic, marketing, legal,
environmental, social and governmental factors. These assessments
demonstrate at the time of reporting that extraction could
reasonably be justified. Ore Reserves are sub-divided in order of
increasing confidence into Probable Ore Reserves and Proved Ore
Reserves.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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