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LONDON (Alliance News) - Amur Minerals Corp shares sky-rocketed on Friday after it said it has finally been awarded its long-awaited production license for the Kun Manie nickel-copper sulphide deposit in the far-east of Russia.
Amur shares were up 71.2% to 17.12 pence per share n Friday morning.
The government of Russian Prime Minister Dmitry Medvedev approved the company's detailed exploration and mine production plan, which in turn led to the Ministry of Natural Resources issuing the production license.
Once final documentation has been registered, Amur will have 30 days to pay around USD480,000 to officially seal the deal.
Amur will be recovering nickel, copper, cobalt, platinum, palladium, and other minor minerals from the project with 841,000 nickel tonnes equivalent lying within the production license area. In March, the company said the project could sustain a 15-year mining plan.
The production license is a significant milestone for Amur, which has been exploring Kun Manie for over ten years. Amur had placed the license application back in November 2014. Amur's subsidiary has now submitted a work programme which outlines the company's plan to take the project into production.
"As we prepare for the detailed exploration, engineering and subsequent production stages of the project, we express gratitude to our team in Russia and the UK, to the Russian Government for their support of the company's efforts, and to our shareholders, many of whom have been steadfast over the years in their belief that Kun-Manie is a highly substantial asset with a great future," said Chief Executive Robin Young.
"As soon as they say here is your license, we go from being a junior explorer to being a pre-production junior company with a plan to continue to take the risk out of the project, optimise the operation while consistently talking to potential funders," Young told Alliance News back in March.
Young has previously said the company had been talking to "typical" banks, Russian banks and mining companies about funding for the project. In March, Young told Alliance News the company had a cash balance just over USD1.0 million.
Young and the company will now turn to four key areas that the CEO highlighted earlier this year.
The company is currently looking at either building a 320 kilometre road from the project to a rail line for USD312 million, or the possibility of leasing a Zeppelin to fly product and equipment. Amur Minerals has a memorandum of understanding with California-based Zeppelin developer Worldwide Aeros Corp. Young said Worldwide Aeros expects to have versions of its Zeppelin up and running by the end of 2016.
Amur is also looking at the possibility of building its own smelter on site to increase production and reduce costs and how to power the project, by either connecting it to a hydroelectric dam 360 kilometres away at a capital cost of USD360 million, or use generators on site for an initial cost of around USD92 million.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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