Polyus will use the pilot plant to establish a flowsheet for a commercial mill, tentatively planned to have capacity to process 30 million mt/y of ore and to produce 1.29 million oz/y of gold. (Polyus produced 1.2 million oz of gold in 2007, approximately one quarter of Russia’s gold production during the year.)

The pilot plant can process 120,000 to 130,000 mt/y of ore and is budgeted at $5.4 million for operating and R&D expenses during 2008. The schedule of works for the plant calls for testing of several different ore dressing and hydrometallurgical schemes for processing Natalka ore.

After the Natalka project is in commercial production, Polyus will maintain the plant as a permanent facility for testing ores from other deposits that the company has under development.

The occurrence of gold in the vicinity of the Natalka deposit was first noted in 1941-1942, and exploration of the deposit was pursued intermittently over the next 60 years. In 2003, Polyus launched a major project to re-evaluate Natalka resources and establish a production concept for the deposit. A large-scale exploration effort from 2004 through 2006 included 120,000 m of diamond drilling, 655,000 m3 of trenching and processing of more than 44,000 samples. A scoping study was completed in late 2006.

Mining at Natalka will be by openpit methods. Capital investment to reach commercial production is estimated at $1.5 billion. Start of production is currently scheduled for 2012.