Russia’s 4th largest gold deposit

Key facts

Location North-east Yakutia, Russia
Ownership 100%
Ore Reserves (JORC) 4.4 Moz GE at 3.6 g/t average grade
Mineral Resources (JORC) 8.1 Moz GE at 5.1 g/t average grade
Mining Open-pit +underground
Processing Flotation/Gravity concentration + off-take/ Amursk POX
Annual production 155-180 GE Koz
Production start date Q4 2021
Life of mine 2045


Nezhda is Russia’s fourth largest gold property located in the Republic of Sakha (Yakutia). The estimate of Proved and Probable Ore Reserves contains 4.4 Moz of gold equivalent (“GE”) at average grade of 3.6 g/t GE. Mineral Resources (additional to Ore Reserves) comprise 8.1 Moz of GE with an average GE grade of 5.1 g/t.

The Company envisions the construction of an open-pit and underground mine, and a conventional on-site concentrator followed by concentrate processing at the Amursk POX and/or 3rd-party off-take. This ensures low capital intensity for the project, making it an excellent fit for Polymetal’s core capabilities.

Total capital costs for Nezhda in 2019-2021 are estimated at US$ 330 million, which will be funded out of free cash flow.

2019 project update

  • All main and auxiliary equipment contracted
  • Statutory design documentation submitted for approval to the Main Department of State Expertise
  • Construction and installation works at the concentrator, crusher and cake storage proceed according to plan
  • Mining activities proceed on schedule — interpit roads construction at pits 1 and 2 completed
  • Camp and storages construction completed
  • Upgrade of the road from the Kolyma federal highway to the mine site completed

Have a look at кey project milestones.

Location History Geology and Mineralisation Reserves and Resources Project development timeline

Nezhda is the fourth largest gold deposit in Russia, located in northeast Yakutia in the Tompon municipal district, approximately 480 km east from the city of Yakutsk (population of 350,000). The property is remote with access by an all-season unpaved road and no grid connection. The nearest federal highway is 110 km away from the deposit by all-year unpaved road. The highway provides direct access to the Khandyga river port (170 km) and the Nizhniy Bestiakh railway spur (540 km). The climate is characterized by long severe winters and short hot summers. The relief is moderately mountainous with relative altitudes above valley floors not exceeding 600 m.

The Nezhda gold deposit was discovered in 1951 during the Allakh-Yunskaya geological exploration expedition. From 1959, the deposit was subject to several exploration and evaluation initiatives resulting in newly identified ore zones. In 1975, a 180 Kt per annum underground mine and concentrator was commissioned at Nezhda with over 2 Mt of ore mined and processed before the operation was placed on care and maintenance in 2005. Polyus acquired the asset in 2006, subsequently undertaking an extensive exploration program and completing several technical studies.

Polymetal first entered into the joint venture for the property in 2015, acquiring a 15.3% stake in the South-Verkhoyansk Mining Company («SVMC») which owns the mining and exploration license for the property. In July 2017, the company has agreed to increase its stake to 24.7% with a call option to buy out the remaining 75.3% in 2018, subject to certain conditions. In 2018, after the Board approved the start of project construction, Polymetal consolidated 100% interest in Nezhda.

The deposit is composed of large mineralised zones, representing areas of intense brecciation comprised of crushed and sheared, hydrothermally altered, sedimentary rocks that have been variably enriched in quartz. The Nezhda mineralisation is double refractory due to the encapsulation of fine gold particles within sulphide minerals and significant presence of preg-robbing carbonaceous material.

The Nezhda Ore Reserve estimate is reported in accordance with the JORC Code (2012) as at 1 January 2020.

The estimate has been updated with 217 additional drill holes (39 km) and is based on data from a total 64,708 m of diamond drilling completed by Polymetal between 2015 and 2018 in addition to the 339,392 m of drilling completed by previous owners. Two hundred and ninety-four mineralised intersections were identified based on fire assay results.

Mineral Resources for the open pit were estimated up to a depth of 250 m from the surface, with the underground portion estimated up to a depth of 440 m from the surface.

The largest mineralised structure is ore zone 1 («OZ 1») which has a strike length of 4,900 m and a vertical extent of over 1,800 m and comprises approximately 70% of currently estimated GE resources at Nezhda. For OZ 1, top cutting at 80 g/t gold was applied to reduce outlier grade influence on local estimation. Another first-priority mining area is Ore Zone (OZ) 56.

Nezhda Ore Reserves estimate as at 1 January 2021
Ore Reserves Tonnage, Mt Gold grade, g/t Silver grade, g/t Copper grade, % GE grade, g/t Gold, Koz Silver, Moz Copper, Kt GE, Koz
Total 38 3.4 15 - 3.6 4,216 18.6 - 4,412
Mineral Resources Tonnage, Mt Gold grade, g/t Silver grade, g/t Copper grade, % GE grade, g/t Gold, Koz Silver, Moz Copper, Kt GE, Koz
Total 49.4 5.0 10 - 5.1 7,911 15.2 - 8,071
  • Q1 2019 Start of construction (done)
  • Q3 2019 First ore mined (done)
  • Q4 2019 Plant framework construction and winterization completed
  • Q1 2020 Start of equipment installation
  • Q3 2020 Construction and commissioning of power plant completed
  • Q2 2021 Mechanical completion
  • Q3 2021 Start of commissioning activities
  • Q4 2021 End of commissioning activities and first production
  • Q2 2022 Full ramp-up

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