Appendix 1
Project and Facilities Description, Scope of Work and Key Milestones
1
BACKGROUND
1.1
CUSTOMER
Baikal Mining Company, a Limited Liability Company (BMC LLC)
1.2
PROJECT NAME
Process Complex of Udokan Mining and Metallurgical Plant
1.3
SCOPE OF WORK
Development of Design Documentation (Stage P) in accordance with the RF Government Decision No.
87 dated 16.02.2008 and obtaining of approvals from the state experts board on ecology, approval from
FAU Glavgosexpertiza of Russia and from TsKR-TPI of Rosnedra (Central Committee for Solid Mineral
Deposits Development of Federal Agency on Subsoil Use).
1.4
DESIGN BASIS
Subsoil Use License No. CHIT 14956 TE dated 28.06.2010 for extraction of copper and associated
components at Udokan deposit in Zabaikalye region. The license is valid till 22.09.2029.
1.5
TYPE OF CONSTRUCTION
New construction (Greenfield).
1.6
LOCATION OF THE SITE
Russian Federation, Kalar district of Zabaikalye Region, 40 km southeast from the district centre of Chara
village, 23 km south from the town of Novaya Chara and station on the Baikal-Amur Mainline (BAM)
railroad, and 650 km northeast from the regional capital of Chita.
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1.7
CONSTRUCTION AREA CHARACTERISTICS
Kalar district is characterized by harsh climate conditions and is a part of the mountainous and taiga
regions of the Far North. The deposit is situated in the high-mountainous part of Udokan ridge of
Olekmo-Vitimskaya highlands (the Stanovoy Range). The highest point of the Udokan ridge is the
Skalistiy peak at the elevation of 2561 m. The deposit area is high-mountainous and intensely dissected
terrain. Absolute elevations at the works site range from 1500 to 2100 metres. Inter-stream lines are not
distinct and covered with alluvial boulder streams. The mountains slopes are steep (up to 35-40o) and
are mostly covered with large and medium rockslides. Relatively high areas are at 300-600 m. The
whole area of the deposit is characterized by continuous permafrost with the thickness of over 900 m.
The bottom of the permafrost zone is at the absolute depth of 1,100 - 1,200 m. Characteristics of the
areas with permafrost such as thermokarst funnels, rock streams, boulder streams, high mountain
terraces, frost mounds, aufeises, polygonal and ridged-profile terrain are also commonly observed.
Chara river is the main catchment in the region and the area of the deposit is drained by its tributaries:
Ingamakit river (and its tributaries), Nirungnakan, Emegachi and others. Water courses are mostly
mountainous with deep valleys, pebble riverbeds and abundant rapids. Flow distributions are uneven
through the year. The runoff may increase by several times depending on the season (for example during
the spring freshet).
The climate is sharp continental with very cold and long winters and short hot summers. The average
long-term temperature in the Udokan deposit area is below zero and ranges from –5.6º to – 9.0ºС
according to the data from different weather stations. Negative annual monthly temperatures are observed
7-8 months of the year. The coldest month, January, varies in temperature from -24.5° to -35.8°C. The
absolute minimum temperature registered at Chara weather station was -57°С. The warmest month of the
year is July. The average long-term temperature of July varies from 12.5°С to 16.3°С, and an absolute
maximum of 33.9°С was registered at Chara weather station. In any of the summer months snow can be
expected to fall and the temperature may drop to 0º at any time. The precipitation is distributed unevenly
throughout the year. In the cold period (October to April) about 18% of the total amount occurs and in
July and August - up to 40% of the annual amount. The amount of precipitation increases with elevations:
it is about 350 mm in the Chara basin and up to 650 mm on the mountain ridges. The first snow is usually
observed in September. Generally in mid-October and sometimes at the end of September the snow
covers the ground. The snow melts in April in lower areas and in May at higher elevations. Avalanches
often take place in the period from March to May and rockslides are regular.
In winter the wind pattern (weak winds and calm periods) is influenced by the winter Asian anticyclone.
In summer western disturbance becomes the predominant circulation process. Wind velocity in the
deposit area does not increase significantly with altitude. Fogs and ice crusted grounds are common in
spring and autumn.
Middle-taiga and sparse forests are prevalent on Stanovoe highlands. Daurian larch is the prevalent forest
tree in the region. Low birch and willow thickets are very common in depressions. Small areas are
covered by meadows that are often swampy. The region's fauna is typical for taiga forests and is not
characterised by wide diversity due to harsh regional climate.
The deposit area is in a highly active seismic zone (9 out of 12 by MSK-64 Earthquake Intensity Scale).
Udokan village is the populated area closest to the Udokan deposit, located 17 km to the northwest.
There is an access road form the settlement to the deposit. The system of roads connects the populated
localities of Kalar district. Transport connection with the other federal subjects of the Russian Federation,
Buryatia, Sakha-Yakutia and Amur is possible only in the winter period and in drought periods of warm
season due to difficulties in crossing the water courses. In general, the road infrastructure in the region is
not well developed.
There is a railroad station in Novaya Chara (urban settlement) of the same name. This station is a part of
the East-Siberian railroad of the Baikal-Amur Mainline (BAM). Chineiskaya rail line, which is not
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currently used, runs close to the deposit. This line requires refurbishment as it has not been serviced for
10 years.
Air transport in the region utilizes the existing Airport in Chara village. The runway is capable of
accommodating the following aircraft: AN-24, AN-26 and Yak-40.
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INPUT DATA FOR ENGINEERING
2.1
GEOLOGICAL CHARACTERISTICS OF THE DEPOSIT
The ore body of the Udokan deposit is different from common deposits where the oxidized component is
located in the upper part, then there is a mixed area with the sulphides at the bottom. This ore body is
characterized by the oxidized ore located down to the depth of 500 m therefore ore with high degree of
oxidation will be mined throughout the life of the deposit.
The main valuable components are copper and silver associated with copper minerals.
Three main natural ore types can be differentiated at Udokan deposit by their main minerals:
- Chalcocite-bornite;
- Bronshatite- malachite;
- Chalcopyrite -pyrite.
The ores are mostly characterized by medium oxidation state. A significant part of the oxidized copper
minerals are hydroxyl sulphates which are difficult to float. A part of copper is bound to silica minerals.
It should be noted that the distribution of the oxygen-bearing minerals within the ore is extremely uneven,
which does not allow to differentiate the ore bodies by the oxidation state. At one and same cross section
of the ore bodies in the deposit areas all the ore types are observed: from purely sulphide to completely
oxidized. No gradual transitions are observed. The transitions between the ores with different oxidation
states are sharp. Therefore it is impossible to single out sulphide, mixed and oxide ores, consequently
mining by ore types is impossible.
2.2
ORE PROCESSING FLOW SHEET
The ore is transferred to primary crushing area on the edge of the pit. Ore processing facilities are located
at two sites.
Crushed ore is then transferred by a system of conveyors to the coarse ore storage area of the concentrator
at Site 1. Coarse ore is conveyed from the storage area to grinding and flotation areas to produce bulk
concentrate. The bulk sulphide and oxide concentrate is thickened and transferred by an overland pipeline
from Site 1 to Site 2. Bulk flotation tailings are then directed to the thickeners and then to the Tailings
Storage Facility.
The thickened concentrate is filtered at Site 2, repulped and fed to the sulphuric acid leaching tanks. After
solids and liquid separation the pregnant leach solution (PLS) is sent to the solvent extraction and
electrowinning for copper extraction to marketable cathodes. The remaining leach cake is neutralized,
reground and transferred to sulphide flotation. The resulting sulphide concentrate is thickened, filtered
and packed in big-bags for further shipment to the consumers.
Sulphide flotation tailings are thickened and pumped from Site 2 to Site 1 where they will be combined
with the bulk flotation tailings. The combined tailings will be pumped to the TSF.
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2.3
LIST OF THE PRODUCTS OF THE FUTURE PLANT
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LME grade A copper cathodes
Copper silver-bearing flotation concentrate
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2.4
SCOPE OF THE COMPLEX
The scope of the complex to be designed comprises the following areas:
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Ore Crushing, Conveying and Coarse Ore Storage
Concentrator and Refinery
Tailing Storage Facility
Electrical heating is planned for all the facilities.
2.4.1 ORE CRUSHING, CONVEYING AND COARSE ORE STORAGE
The crushing area is located on the edge of the pit. The ore is then transported by a system of conveyors
to the coarse ore storage at Site 1.
List of the main facilities:
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Primary Crushing Area
Conveyors System to the Storage Area
Coarse Ore Storage
6/0.4kV Transformer substations
On-site Utilities
2.4.2 CONCENTRATOR AND REFINERY
Udokan Mining and Metallurgical Plant process facilities will be located at two sites.
Site 1
Site 1 is located close to the pit for decreased ore conveying costs.
List of the main facilities:
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Concentrator building (Grinding, Bulk flotation, Reagents Area)
Pebble Crushing Area
Bulk Concentrate Thickening
Bulk Concentrate Pump House and Piping
Bulk Flotation Tailings Thickening
Combined Tailings Pump House and Pipeline
Process Water Tank and Pump House
Fire Water Tanks and Pump Station
6/0.4kV Transformer Substations
On-site Utilities
Water Discharge System Treatment Facilities
Machinery Repair and Metalworks Area
Administration Complex
Gatehouse and Weight Control Station
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Site 2
Site 2 is situated not far from Chineyskaya railroad.
List of the main facilities:
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
Bulk Concentrate Leaching Area (Filtering, Leaching, Polish Filtering, Cake Neutralization)

Sulphide Flotation (Leach Cake Regrinding, Sulphide Flotation, Reagents Area)
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Sulphide Concentrate Thickening
Sulphide Flotation Tailings Thickening
Sulphide Flotation Tailings Pump House and Piping
Sulphide Concentrate Filtration
Storage for Sulphide Concentrate Bags
Sulphide Concentrate Storage with the Bagging Area
Bagged Sulphide Concentrate Storage
Solvent Extraction
Copper Electrowinning
Copper Cathodes Storage
Sulphuric Acid Plant
Assay Laboratory
Process Water Tank and Water House
Fire Water Tanks and Pump Station
6/0.4kV Transformer Substations
On-site Utilities
Water Discharge System Treatment Facilities
Machinery Repair and Metalworks Area
Administration Complex
Gatehouse and Weight Control Station
Emergency Centre
Heliport
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Leach Slurry Solid-Liquid Separation
2.4.3 TAILINGS STORAGE FACILITIES
The TSF will be constructed as a valley type impoundment and will be located close to the pit. The starter
dams will be formed from waste rock from the mining area. Geomembrane liner system will be used to
prevent/minimize seepage. A floating barge pump station will be used to pump back the reclaim water.
2.5
THE PLANT SUPPORT FACILITIES, UTILITIES AND WORKS
The following facilities and utilities are not included in the scope of work for the Process Complex.
2.5.1 RAW MATERIALS
Mining Area engineering will be performed as part of another project interconnected with the project
described herein.
2.5.2 POWER SUPPLY
Power will be supplied to the Udokan Mining and Metallurgical Plant from Federal Grid Company (FSK)
power grid. Engineering of all the 6kV and higher voltage power lines, and all the 35/6/0.4kV and higher
voltage transformer substations will be performed as part of another project interconnected with the
project described herein.
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2.5.3 WATER SUPPLY
Water for the plant will be supplied from boreholes at an underground water deposit nearby. Raw water
will be pumped from the wells to the water storage pond, distributed to the process sites and treated. The
design of the water supply system will be performed as part of another project interconnected with the
project described herein.
2.5.4 FUEL AND LUBRICANTS SUPPLY
Engineering of the fuel and lubricants supply facilities will be performed as part of another project
interconnected with the project described herein.
2.5.5 ACCOMMODATION
Permanent accommodation for operations staff will be located at Novaya Chara settlement. Expansion of
Novaya Chara town infrastructure will be required to support the increased population needs. The
expansion is not included in this Scope of Works for the Process Complex.
2.6
WAREHOUSES AND VEHICLE SHOPS
Engineering of the warehouses and vehicle shops facilities will be performed as part of another project
interconnected with the project described herein with the exception of the warehouses specified as part of
the main Concentrator and Refinery buildings and structures.
2.7
ROADS AND RAILROAD
Engineering of the roads and railroad as well as on-site roads will be performed as part of another project
interconnected with the project described herein.
2.8
LAND PLOT ARRANGEMENT
Rough grading design for all the sites within the scope of the Project will be performed as part of another
project interconnected with the project described herein.
2.9
SOLID WASTE LANDFILLS
The design of the solid waste landfills will be performed as part of another project interconnected with the
project described herein.
BATTERY LIMITS
Incoming:
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Head ore - at the feed bins of the primary crushers.
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Water supply - raw water pipelines flanges at the water treatment pump stations at Site 1
and Site 2 (1 m from the pump house buildings).
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Power supply – connection points on 6kV switchgear at all the sites within the scope.
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Reagents - pallets with reagents in the reagent storage area.
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Grinding balls - grinding media storage area.
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Elemental sulphur - receiving warehouse of the Sulphuric Acid Plant.
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Auxiliaries - at the border of Site 2.
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Access and site roads - connection points at the borders of all the sites within the project scope.
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Rail Yard - external border of the yard.
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Communications - at the border of Site 2.
Outgoing:
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Copper cathodes – in stacks at the cathodes storage area.
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Copper concentrate – in big bags at the bagged sulphide concentrate storage area.
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Solid waste - at the borders of Sites 1 and 2.
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2.10
PROVISIONAL WORKS COMPLETION TIME
Works start
July 2015
Completion of the main engineering solutions
March 2016
Completion of Design Documentation
June 2017
Approvals from state experts board on ecology,
FAU Glavgosexpertiza and
TsKR-TPI of Rosnedra (Central Committee
for Solid Mineral Deposits Development of
Federal Agency on Subsoil Use)
January 2018
2.11 DOCUMENTS TO BE PROVIDED BY THE CUSTOMER FOR THE DEVELOPMENT OF
DESIGN DOCUMENTATION PRIOR TO THE WORKS COMMENCEMENT

International Feasibility Study Materials

TEO Konditsii (Feasibility Study of the Deposit Development Conditions)
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Process Design Package

Preliminary Engineering Survey Reports
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