Russian gold miner Polyus Gold has netted $10 million for its Kazakhaltyn MMC project in a strategic move to fund development of its domestic assets.

Russia’s largest gold company is selling off its Kazakhstan and Kyrgyzstan projects to pour funds of up to $1.2 billion into the Natalka development project, a large gold mine in Russia's Far East where a processing plant is expected to be commissioned by the end of 2013.

The Kazakhaltyn MMC JSC project was purchased by Institute Project BV, with an indirect subsidiary of Polyus, Jenington International, rolling all the company’s loan agreements into an aggregate cash consideration of $287.8 million. Polyus also completed the sale of all of its shares in Norox Mining Company to Folkstand Consortium for $1 million.

The company has also announced its 2013 output target, which is 7% higher than the previous year’s production. Polyus says it will produce between 1.7 and 1.8 million ounces of gold from its sites, excluding its Kazakhstan operations.

“It is expected that the increase will be driven by further improvement in recovery rates at Olimpiada, Titimukhta and Verninskoye (mines), along with the increase in processing volumes at Titimukhta,” Polyus’ chairman Robert Buchan says.

In 2012, the company’s gold output rose 12% to a record of 1.68 million ounces, with gold sales estimated to reach $2.8 billion, a 22% increase.

Polyus also expects its 2013 capital expenditure to be in the range of $1.5-1.6 billion, or more than double last year’s $750 million. Analysts have reported billionaire Mikhail Prokhorov is close to selling his 38% stake in Polyus in a complex deal currently being reviewed by British regulators.

www.polyusgold.com

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