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Further details on 2016 production schedule from Q1 & 2
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terrancekeenan
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August 4, 2016 - 6:05 pm
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Q1 Financials and company NR

The company filed the Q1 Financials and MD&A on SEDAR.  They also issued an NR (on the company`s website - see link at the bottom of this post).
Q1 is usually a downtime for production due to the cold winter and the operation being heap leach.  As such, the plan is for 100% mining in Q1.  Nevertheless, they managed to production some gold from 2015 ore that were already stacked on the heap leach pads - 1,850 ounces produced in Q1.

The balance sheet looks very clean now.  They were able to put through the debt elimination in Q1, for financial statement reporting.  However, the new debt of US $10 million has not been included as yet - that will likely go into the Q2 financials.

In addition to maximizing gold production at Savkinskoye, the company has a primary strategy in 2016 and 2017 of moving not only the Nasedkino property but also the Zolinsko-Arkiinskaya property closer to gold production.

From pg 2 of the MD&A (on SEDAR):

``Strategic Goals and Recent Developments

Trends, risks, demands

The main strategy of the Company in 2016 and 2017 is to prepare Nasedkino and Zolinsko-Arkiinskaya areas for production. For this the Company plans to exploit maximum capacity of Savkinskoye. However, the Company and production on Savkinskoye is heavily dependent on price on gold. The recent growth trend of gold price allows to develop ore with lower grade that was previously uneconomic.

For construction on Nasedkino and Zolinsko-Arkiinskaya the Company will need to obtain funding additional to proceeds from Savkinskoye. The restructuring of loans to equity started in 2015 and finalized in early 2016 has led to improvement of the Company’s financial position, that allows to expect that the Company can receive external funding on favorable terms.

Currently the Company is busy with estimations and planning in order to assess the timing of the projects and volume of additional funding.

Savkinskoye update

During 2015 the Company reconstructed and launched the second crushing and screening complex that led to increase of capacity and allowed to achieve the announced gold production.

It is planned to continue mining of Central part and at the end of the year to start mining of South-West part of the deposit. The exploration works of the flanks for further estimation of reserves will be continued during the year.

Nasedkino update

In the first quarter of 2015, the Company started preparation of feasibility report on mineral deposits in compliance with Russian Federation legislation. The feasibility report was submitted and accepted by GKZ. The Company considers the preparation of the report according to NI 43-101.

In April 2016 the Company received another exploration and mining license for additional areas of Nasedkino. It is expected that the new areas will lead to significant increase of estimated reserves of Nasedkino.

In 2016 the Company plans actively develop Nasedkino for exploration and construction of the plant to start the production.  During Q1 2016 there were no exploration works.

Zolinsko-Arkiinskaya update

In 2016 the Company continues exploration in order to assess the reserves of deposit. During Q1 2016, the Company performed the excavation of trenches for dissection and sampling of ore bodies from surface. The distribution of mineralization at depth is estimated by sloping core drilling. It is planned to cover main ore body of a flank of the deposit (Kochkovaskay) by every 100 m along the strike and every 50-100 m in the fall. The rest known and expected ore bodies are planned to explore by the random excavation. During Q1 2016 the Company passed 184.2 m of core drilling on 1 drill hole and 3,196 m3 of trenching, made 170 core samplings and 230 trench samplings.

In Q1 2016 the Company continued researches of alluvial areas of the deposit. During the period the basin of the upper river Urov within the deposit was researched and the samples from core drilling are analyzed.

In 2016 it is planned to continue exploration works on known and expected ore bodies. Researches of alluvial areas of the deposit will be finalized for further preparation of feasibility report.``

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