Polymetal to sell North Kaluga polymetallic deposit

Polymetal has agreed to sell its North Kaluga polymetallic deposit in the Sverdlovsk region of Russia for around $27m.

Chief executive officer Vitaly Nesis said: "We continue to advance our non-core asset disposals. The North Kaluga deal brings us some cash and retains exposure to commodity prices."

Polymetal said on Monday that it has entered into a legally binding agreement to sell North Kaluga to North Kaluga Mining Limited. The deal consists of a $10.7m fixed upfront cash payment, 5% net smelter return (NSR) and 50% royalty on excess revenue.

The fair value of the royalties is estimated at $13.5m as of the date of the agreement, while both NSR and the excess revenue royalty are capped at $300m.

The new owner will also repay all debt owed by the North Kaluga's license holder to Polymetal.

North Kaluga’s mineral resources comprise copper, gold, zinc and silver, with most of the value attributable to copper and gold.