OREANDA-NEWS. March 11, 2008. OJSC Polyus Gold (RTS, MICEX and LSE - PLZL), Russia’s leading gold producer, announced that its Board of Directors on a meeting held today approved the Kuranakh Mine upgrading project. The upgrade will result in increasing the plant’s capacity to 4.5 million tonnes of ore per year.

The Kuranakh group of deposits is located in Aldan region of the Sakha Republic (Yakutia). OJSC Aldanzoloto GRK, a wholly owned subsidiary of OJSC Polyus Gold, is a licence holder for 11 deposits of Kuranakh ore field.

The plant at Kuranakh mine, constructed in 1965, currently processes 3.6 million tonnes of ore. The upgrading programme will increase the plant’s capacity to 4.5 million tonnes of ore per annum. The modernization programme will start in Q1 of 2008 and will be completed in Q4 this year. The total cost of the project is 715.2 million rubles ($28.6 million) (not including VAT).

General Director of Polyus Gold Evqueni Ivanov said that the plant upgrade programme at Kuranakh mine is stipulated in the company’s Strategy till 2015. "Expanding and upgrading production facilities of Kuranakh mine is another step in the development of Polyus operations in Yakutia", - Mr. Ivanov said. He also added that since OJSC Aldanzoloto GRK was acquired in September 2005, Polyus Gold has invested into the mine’s production facilities development 868 million rubles ($35 million) in total. During that period the gold production at the mine was increased from 4.1 tonnes (132 k oz) in 2005 to 4.4 tonnes (141 k oz) in 2007.  The plan for the coming two years is to increase the metal production at Kuranakh mine to 4.7 tonnes (151 k oz) in 2008 and to 5.2 tonnes (167 k oz) in 2009.

Polyus Gold is the largest gold producer in Russia. Headquartered in Moscow, Polyus Gold’s operating mines and development/exploration projects are located in five major gold mining regions of Russia - Krasnoyarsk, Irkutsk, Magadan, Amur regions and the Republic of Sakha (Yakutia). The company produced 1.2 m oz of gold in 2007.