OJSC Polymetal | Company Profile

About the Company

Polymetal is a precious metals mining company, which produces gold and silver. The company carries out the full range of deposit development — from exploration to production.
Polymetal was established in 1998 in St. Petersburg by the ICT Group, which hoped to create a Russian mining company that would use state-of-the-art technology from exploration to bullion production.
From 2005 till February 2007, the sole shareholder of the company was Nafta Moscow, a Russian private direct investment fund. In February 2007, the Company floated 24.8% of its shares — both ordinary shares and global depository receipts (GDRs — in an initial public offering (IPO) on the London Stock Exchange, RTS (Russia) and MICEX (Russia). In June 2008 Nafta Moskva (Cyprus) Limited sold all of its interest in the Company to three parties: Quotan International Limited, PPF Group NV and Inure Enterprises Limited.

Polymetal’s headquarters is located in St. Petersburg. There is also a representative office in Moscow.

Currently the company and its subsidiaries operate in five Russian regions — the Magadan, Sverdlovsk and Chita Regions, and the Krasnoyarsk and Khabarovsk Territories. The company has brought four major mining projects into production — Dukat, Khakanja, Vorontsovskoye and Lunnoye. All these projects were green-field, except Dukat which was extensive brown-field.

In 2007, the Company produced 15.9 mln. oz. (495 tons) of silver and 242 th. oz. (7,5 tones) of gold.
 Polymetal is Russia’s largest silver producer and third largest gold producer (based on 2006 results). The Company is also the fifth largest silver producer in the world, based on 2006 results (World Silver Survey, prepared by GFMS and Silver Institute).
 

Polymetal and its subsidiaries hold 22 licenses for exploration and production in five Russian regions. The Company is actively pursuing its program of resource and reserve replacement and increasing its mineral resource base. The Polymetal group includes 5 exploration companies.

Polymetal has its own research and design centre — CJSC Polymetal Engineering. Polymetal Engineering carries out a full range of engineering activities associated with deposit development — from exploration to commissioning mines and processing plants.

The Company is currently focused on building its next generation of assets. Within the framework of this process, in summer 2006, Polymetal acquired the license for the Albazino gold deposit in the Khabarovsk Territory. Polymetal sees Albazino as a potentially promising stand-alone project. This is a green field project, which will require construction of all mining and processing facilities.

In QIII 3 2006, the Company entered into a strategic alliance with AngloGold Ashanti — the world’s third largest gold producer. The 50/50 joint venture between the parties focus on identifying, acquiring and developing Russian gold deposits.

In QIV 2006, the heads of OJSC Polymetal and Mongolrostsvetmet signed constituent documents for a joint venture to develop the Asgat polymetallic deposit in Mongolia. The joint venture — Asgatpolymetal (Mongolia) Limited was registered on December 26, 2006, in accordance with the laws of the People’s Republic of Mongolia. It is a 50/50 joint venture. This international project opens new development prospects for Polymetal.

Production

Polymetal and its subsidiaries operate six producing mines (Dukat, Lunnoye, Arylakh, Voro, Khakanja and Yurievskoye) in the Magadan and Sverdlovsk Regions and the Khabarovsk Territory. In 2007, the Company produced 15.9 mln. oz. (495 tons) of silver and 242 th. oz. (7,5 tones) of gold.

Exploration

Polymetal and its subsidiaries carry out exploration in five Russian regions — the Magadan, Sverdlovsk and Chita Regions and the Khabarovsk and Krasnoyarsk Territories. The company and its subsidiaries hold 22 exploration licenses for deposits and prospective sites.

Polymetal pursues a three-pronged exploration strategy focused on the following: 
- exploration of flanks and deep levels at existing operating deposits; 
- exploration of near-by and remote areas in the regions where the company is currently operating [regional campaigns]; - development of promising new license areas and prospects both in regions in which the company is currently operating and in other areas.

 The company has 5 exploration subsidiaries: 
- OJSC Dukat Exploration Company
- OJSC Northern Urals Exploration Company 
- CJSC Khabarovsk Exploration Company 
- OJSC Aurum
- OJSC Albazino Resources

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