Decision of the Board of Directors


 

TIDMKZG 
 
RNS Number : 1740M 
KazakhGold Group Ltd 
19 May 2010 
 

                                                           FOR IMMEDIATE RELEASE 
 
19 May 2010 
 
  KazakhGold Group Limited (LSE: KZG) today announces the decision taken at a 
                Board of Directors Meeting held on May 18, 2010 
The Board of Directors has reviewed the development strategy of the Kazakhstan 
assets of the Company until 2020. 
The strategy provides for the modernization of existing production facilities to 
increase processing capacities from 0.97 mtpa to 1.3 mtpa and for the 
construction of the Central metallurgical plant (CMP) to decrease a discount 
given to existing semi-products of KazakhGold (to produce Dore gold). 
The strategy also includes: 
·     Exploration program for 2010 -2011 with the objective of increasing the 
mineable reserves base up to 262 tonnes under the base-case scenario and up to 
359 tonnes under the optimistic scenario. 
·     Upon successful completion of the exploration works in 2011, construction 
of the following  is planned for 2013 - 2016 under the base-case scenario: 
(i)         New mills at Aksu, Bestobe and Zholymbet with a total capacity of 
4.7 mtpa; 
(ii)        Heap leaching facilities with processing capacity of 2.2 mtpa. 
 Capital expenditures under the base-case scenario are estimated at US$512 mln. 
·     Upon the successful completion of the exploration works in 2011, under the 
optimistic scenario, construction of the following  is planned for 2013-2016: 
(iii)       New mills at Aksu, Bestobe and Zholymbet with a total capacity of 
9.0 mtpa; 
(iv)       Heap leaching facilities with processing capacity of 4.3 mtpa. 
          Estimated capital expenditures under the optimistic scenario are 
US$661 mln. 
Production volume in 2016 would amount to 500 thousand ounces under the 
base-case scenario of the Company's development and 640 thousand ounces under 
the optimistic scenario. 
The Board of Directors has approved the development strategy of KazakhGold Group 
Limited until 2020. The Board has also approved the capital expenditure budget 
for 2010 - 2013 for the total sum of US$ 202 mln for modernization of the 
existing processing facilities, construction of the CMP and enhancement of 
underground and open-pit ore mining, including: 
 - US$ 83 mln to finance modernization of existing facilities and construction 
of the CMP; 
- US$ 119 mln to ensure the increase in the volumes of underground and open-pit 
ore mining. 
The figures for each specific year are subject to the relevant financing and may 
be revised as part of the corresponding budgets. 
«The modernization of existing assets and commissioning of new operating 
facilities stipulated by the Strategy will strengthen the Company's position 
among the leaders of the Kazakhstan gold mining industry, and the growth of the 
mineral reserves base will provide the necessary conditions for the successful 
development of the Company», says Evgueni Ivanov, Chairman of the Board of 
Directors of KazakhGold Group Limited. «Today we have already started investing 
in modernization and  expansion of production capacities, in particular, a heap 
leaching facility has been launched at the Akzhal deposit located in the Eastern 
Kazakhstan and the first Dore gold has been smelted»  - Evgeny Ivanov noted. 
For further information, contact: 
 
Alexey V. Chernushkin, Director, CM and IR 
Evguenia V.Buydina, IR manager 
+44 (0) 208 528 1450 
+44 (0) 208 528 1020 
 ir@kazakhgold.com 
 
Anton A. Arens, PR Director 
+44 (0) 208 528 1450 
+44 (0) 208 528 1020 
 anton.arens@kazakhgold.com 
 
 
The information contained herein has been prepared using information available 
to Polyus Gold Group at the time of preparation of the presentation. External or 
other factors may have impacted on the business of the Polyus Gold Group and the 
content of this presentation, since its preparation. In addition all relevant 
information about Polyus Gold Group may not be included in this presentation. No 
representation or warranty, expressed or implied, is made as to the accuracy, 
completeness or reliability of the information. 
Any forward looking information herein has been prepared on the basis of a 
number of assumptions which may prove to be incorrect. Forward looking 
statements, by the nature, involve risk and uncertainty and Polyus Gold Group 
cautions that actual results may differ materially from those expressed or 
implied in such statements. 
Nothing herein should be construed as either an offer to sell or a solicitation 
of an offer to buy or sell securities in any jurisdiction. 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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