Tag Archives: Polymetal

Polymetal 2020 profits rise as it accelerates ESG efforts

Polymetal recorded a strong set of financials in 2020, with its revenue, adjusted EBITDA and net earnings metrics all benefitting from higher production volumes and commodity prices.

Revenue increased by 28% year-on-year to $2.87 billion, adjusted EBITDA rose 57% to $1.69 billion and net earnings hit a record $1.09 billion in 2020.

The company’s 2020 gold-equivalent output amounted to 1.56 Moz, a 4% increase year-on-year and 4% above the original production guidance of 1.5 Moz. Strong contributions from its Kyzyl, Varvara and Albazino mines offset a planned grade decline at Voro, as well as lower production at Svetloye, the company said.

While production rose, the company’s greenhouse gas emissions intensity reduced by 4%, Polymetal said. It attributed this to energy efficiency initiatives, switching its mining fleet to electric vehicles, a shift from diesel to grid energy sources and green energy contracts.

Back in December, SMT Scharf AG signed an agreement with Polymetal to develop and produce battery-electric powered LHDs and mid-range underground trucks as prototypes for its gold and silver mines, with these units to be delivered to the company by October 2021.

Polymetal’s environmental, social and governance efforts did not stop there.

In 2020, the company invested $29 million at its Omolon hub in the Magadan region of Russia. This capital expenditure was mainly related to the construction of a dry tailings storage facility and engineering and preparatory works for a 2.5 MW solar plant (due to come online this year). This will be joined by another 5-10 MW solar facility at its Kyzyl operation (Kazakhstan) in 2022.

On its other tailings facilities, Polymetal said: “We operate eight tailings dams in Russia and Kazakhstan; each is rigorously monitored daily. We are confident that any emergency dam failure would have no impact on local communities and employees.

“We welcome the new Global Industry Standard on Tailings Management and have committed to achieving compliance in all operations by 2023.”

In addition to state authority inspections of these facilities, the company conducted an independent third-party audit of its Mayskoye (Chukotka, Russia) tailings site, which was carried out virtually, due to COVID-19 restrictions, by Knight Piésold Ltd. “To further improve tailings safety and minimise the risk of the possibility of dam failure, we are shifting towards dry stack storage methods,” it said.

“Such facilities are already in operation at our Amursk and Voro (pictured filter press) mines, and will be extended to Omolon (2021), Nezhda (2021), POX-2 (2022), Dukat (2024) and Veduga (2025).”

Polymetal and SMT Scharf sign underground electric vehicle MoU

Polymetal and SMT Scharf have signed a Memorandum of Understanding (MoU) for a potential strategic cooperation in underground electric vehicles (EV) development in line with the miner’s climate strategy.

The MoU outlines that Polymetal and SMT will cooperate in the development, implementation and testing of zero-emission battery EVs. Initially, the collaboration is to be focused on mid-ranged LHDs and trucks, with potential involvement of drill rigs and utility vehicles in the future, Polymetal said.

IM understands Polymetal has previously tested RDH (now owned by Scharf under RDH-Scharf) battery-electric machines at some of its underground mines.

Two pairs of units (an LHD and truck) are going to be tested at Polymetal’s operations during the one-year trial with further collaborative re-design, signing of a distribution agreement and establishment of an after-sales support centre, Polymetal said, adding that the strategic cooperation is set to last for 10 years with an opportunity for further extension.

“The partnership with SMT grants us an easy access to customisable battery-electric vehicles which could positively contribute to our operating costs dynamics, greenhouse gas (GHG) emissions and personnel safety at underground mines,” Vitaly Savchenko, COO of Polymetal, said. “It fits well into our strategy to gradually involve EVs across the group’s operations and marks another step towards cutting carbon emissions by 5% in 2023.”

Polymetal’s GHG emissions from mining fleet and mobile machinery at the hubs with underground mines for 2019 were 334 Kt of CO2 equivalent, which is 12% of the group’s total emissions (Scope 1+ 2).