The Varvarinskoye Project

The Varvarinskoye project is a gold-copper deposit in the development phase. The project is wholly owned by Orsu Metals Corp. and currently has resources of 4.46Moz with proven and probable reserves of currently 2.2Moz gold and 254Mlb of copper at metal prices of US$525/ounce for gold and US$1.30/pound for copper.

The project received a US$25 million loan for the further development of Varvarinskoye.

The deposit has simple metallurgy, strong economics and potential for expansion. The project is expected to treat 4.2Mt of ore per annum with a waste to ore stripping ratio of 4.5:1 and has a current mine life of 17 years and achieved its first gold pour in December 2007.

Varvarinskoye is situated in a rural area but is close to the industrial city of Kostanai, which has a well established mining services sector. The area has excellent infrastructure including roads, railways and power close to the project. Water is readily accessible and the flat terrain and mining culture already in existence are considered positive attributes. The regional topography is steppe with undulating and flat ground under cattle grazing and cereal crop. The climate is steppe continental with dry hot summers (average 20°c) and cold snowy winters (average -15°c) which has been taken into account in the plant design, construction schedule and operating plan, which allows it to operate 358 days on a 24/7 per year.