January 16, 2020

Sydvaranger Project Update

Sydvaranger is pleased to provide a progress update on the status of the project. Following on from the granting of the mining concession last year, Sydvaranger embarked upon several works and studies aimed at optimizing and de-risking the plans for future operations. Substantial progress has been made to date, with a view to establish a robust and successful mining business from the outset. World class environmental and mining industry experts have been involved throughout the development phase to ensure a successful start-up of long term operations, as well as setting up the Company to meet its ambition of adopting international environmental standards.  

The operating plans being prepared capture improvement opportunities recognized from prior operations which by increasing capacity in the future, will secure that Sydvaranger stays efficient and cost competitive in the world market in the long term. These future improvements include a new primary crusher, fine crushing and magnetic separation at the mine site, as well as additional capacity upgrades to the concentrator plant. Together with the mine plans, the fully engineered investment plans are the basis for Sydvaranger’s roadmap to safe, reliable and efficient operations.

The ongoing project engineering work is being accelerated towards completion of the detailed engineering designs during the spring. With the work completed thus far, Sydvaranger is confident that the future operations will be thoroughly prepared to achieve good results for all stakeholders. Importantly, the production and investment plans will be matched to ensure responsible and sustainable extraction of resources from the start of activities and throughout the life of mine.

After thorough considerations it has been concluded that the best path to ensure the long term success of Sydvaranger for all stakeholders is to complete all detailed engineering and planning works before launching into a full scale mining and processing operation. As a result, Sydvaranger is now resetting its expectations for a start of operations to target 2021, while financing decisions regarding project funding are anticipated during the summer 2020. The revised timeline will also complement other ongoing activities including procurement of additional mining equipment and a locomotive, further engagement with local stakeholders and submission of detailed plans to the Mining Directorate.

With the decision to postpone the commencement of operational activity in the current year and until project finance is fully secured, recruitment of an organization to support operations will be largely suspended in the short term. We are truly appreciative for the strong expressions of interest shown so far by those that have already applied for positions with Sydvaranger, and our HR people will contact you directly with further information about the future recruitment process.

Commenting on the project update, Mr. Felix Tschudi says:

“…Despite the additional time required to finalise the detailed engineering and planning works under the new mine plan, we recognise the enormous effort made by all those involved in getting to where we stand now. While we had all wished for an earlier start, it is clear that completing the final stage of engineering work will be to the benefit of Sydvaranger and all stakeholders for the long term.

As the custodian of the Sydvaranger mineral resources, we believe that the careful and thoughtful approach we are taking now will ensure robust and successful operations from the start and secure the positive long term development of Sydvaranger, in order to benefit all stakeholders in a sustainable manner.”

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