Polymetal International plc

Entering into Stage 1 of Joint Venture with Polyus Gold at the Nezhdaninskoye Gold Property

Polymetal International plc (LSE, MOEX: POLY; ADR: AUCOY) ("Polymetal") is pleased to announce that it has entered into the first stage (Stage 1) of a joint venture with OJCS Polyus Gold (MOEX - PLZL) ("Polyus Gold") to advance the development of the Nezhdaninskoye gold deposit in Yakutia, Russia ("the Property").

On December 24, 2015 Polymetal announced that it had entered into a joint venture with Polyus Gold.

On 19 January 2016 Polymetal obtained a 15.3% interest in the joint venture entity holding 100% of JSC South-Verkhoyansk Mining Company ("SVMC"), the owner of the mining and exploration license for the Property as well as certain infrastructure adjacent to the deposit.

INFORMATION ON THE PROPERTY

Nezhdaninskoye is the fourth largest gold deposit in Russia. It is located in the north-east of Yakutia, in Tomponsky district, approximately 480 km east from the city of Yakutsk. The Property is remote with access by all-season unpaved road and no grid connection. The climate is characterized by long severe winters and short hot summers.  The relief is moderately mountainous with relative altitudes above valley floors not exceeding 600 m.

The deposit is composed of large scale mineralised zones, representing zones of intense brecciation comprised of crushed and sheared, hydrothermally altered, sedimentary rocks that have been variably enriched in quartz. The quartz occurs as randomly oriented stringers, lenses, and veins. Within the lateral limits of these zones, there are lean bands of variably silicified sedimentary protolith. There are also veins composed of quartz with relics of the host rocks.

Nezhdaninskoye mineralization is double refractory due to the encapsulation of fine gold particles within sulphide minerals and significant presence of preg-robbing carbonaceous material.

A 180 Kt per annum underground mine and concentrator were commissioned in 1975. Over 2 Mt of ore was mined and processed at an average gold grade of 7.6 g/t before the operation was placed on care and maintenance in 2005.

Polyus Gold acquired Nezhdaninskoye in 2006. Since then, Polyus Gold has undertaken an extensive exploration program and completed several technical studies aimed at defining a workable strategy for the development of the Property. Both Polyus Gold and Polymetal expect to adopt a development approach characterized by low capital intensity.

According to the Russian State Reserves Commission (GKZ), the gold reserves (С1+С2) amount to 20.3 mln ounces (632 tonnes) at the grade of 5.1 g/t¹.

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¹ The GKZ reserves are not compliant with the JORC Code and represent estimate of in situ mineralisation without adequate proof of economic viability of extraction.

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