Russia’s Polyus claims Siberian gold mine as world’s biggest

MINEX Forum | November 16, 2020 | Views: 96 | Source: Financial Times

Russian gold miner Polyus has said its undeveloped Siberian deposit Sukhoi Log is the largest in the world, with 40m ounces of proven reserves.

The deposit, which accounts for about a quarter of Russia’s entire unmined gold, makes Polyus the world’s second-largest gold miner by proven reserves, the company said on Thursday.

“We are pleased with the results . . . The publication of the maiden ore reserve estimate represents a significant milestone for Polyus’ long-term development strategy, and confirms Sukhoi Log’s position as one of the world’s highest-calibre gold deposits,” Pavel Grachev, chief executive, said in a statement.

The announcement comes a month after Polyus agreed to pay $128.2m to accelerate the buyout of its partner in Sukhoi Log, Russian state defence group Rostec, and take control of the 22 per cent stake in the deposit that it did not already own.

Shares in the company, Russia’s largest gold miner by production, were up 1.4 per cent in Moscow on Thursday morning, against a slight fall in the overall market.

The company also announced that its total gold output in the third quarter had risen 2 per cent on the same period a year earlier to 771,000 ounces, with estimated gold sales up 36 per cent to $1.44bn.

Production and development plans for Sukhoi Log, which lies almost 6,000km from Moscow in the far east of Siberia, are yet to be announced. A pre-feasibility study is expected to be published by the end of the year.

The company, which has begun work on building a local airport to serve the remote site, has previously said development costs could be about $2.5bn.

The deposit contains 540m tonnes of ore with an average grade of 2.3 grammes of gold per tonne, according to the estimate, the first it had done under international JORC standards. That made it the largest gold deposit in the world among both greenfield and developed mines, Polyus said.

The company’s Moscow-listed shares have more than trebled in value this year thanks to a surge in gold prices to a record high in August and big expectations for Sukhoi Log.

That has made Suleiman Kerimov, who owns a majority stake in the company through his family, Russia’s richest man, according to Forbes.

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