MOSCOW, June 7 (Reuters) - Russian gold miner Polyus said on Thursday it planned to make a final investment decision on Sukhoi Log, one of the world’s largest untapped gold deposits, by 2020-2021, when it would also begin capital spending on construction.
Should a positive investment decision be made, production would start around 2026, the company, Russia’s largest gold producer, said in its statement.
“We have made serious progress in the development of Sukhoi Log during the last 14 months following the acquisition of the licence,” chief executive Pavel Grachev said.
“We see it as a cornerstone of the future development of Polyus,” he added.
The company said it expected construction capex to be in the range of $2 billion to $2.5 billion. Around $30 million will be spent on geological and engineering studies per year in the run-up to the investment decision at Sukhoi Log, located in the Irkutsk region of eastern Siberia.
Polyus said the Sukhoi Log processing facility would use a conventional gravity/flotation process to treat an average of 30 million tonnes of ore a year. It said it expected average annual production of around 1.6 million ounces with a total cash cost of $420-470 per ounce.
Polyus said on its website that the Russian State Commission on Mineral Reserves had estimated Sukhoi Log’s gold reserves at 930.3 million tonnes of ore, grading 2.1 grams per tonne of gold for 62.8 million troy ounces of contained gold. (Reporting by Polina Ivanova; Editing by Adrian Croft)