Comment on Russian Environmental Agency Inspection of Mayskoye Licence
Highland Gold Mining Limited (“the Company”) has noted the recent press coverage in relation to the Russian environmental agency’s (Rosprirodnadzor) inspection of Highland Gold's licences for its Mayskoye development project in Far Eastern Russia.
The Company confirms that the agency is initiating an inspection to determine whether the Company is fulfilling its licence obligations and to review the status of the feasibility study for Mayskoye.
The Company confirms that a term of the operating licence, which was originally issued in 1999, stipulated production of 1,000kg of gold in 2007. Mayskoye was acquired by the Company in late 2003. As previously announced, following delays due to changes in the mine design and additional metallurgical test work, the feasibility study for Mayskoye is currently due to be published in the second half of this year and the mine is not scheduled to enter into production until 2010. The Company is currently in the process of negotiating the necessary changes to the terms of the Mayskoye licence.This will be the first license extension request since the acquisition of the asset.
Henry Horne, Managing Director said, “We view this first inspection since acquiring the licence of our compliance with the licence terms at Mayskoye as part of the normal process in the development of licenses worldwide. The notice from Rosprirodnadzor refers to the start of an inspection and the Company has not been found to be in breach of its licence terms. We will be responding to any requests made by the agency. A presentation on the progress of the project is scheduled to be made next week to the Deputy Governor of the Chukotka Region. In addition to the original purchase price of $34 million paid for the licence, we have invested $70 million to develop the mine infrastructure and have undertaken a comprehensive drilling programme. We remain committed to the project and the Chukotka region.”
For further information please contact:
Henry Horne, Managing Director
Dmitry Yakushkin, Director of Communications
Moscow: + 7 (495) 777 3155
Or, WMC Communications,
Alex Glover on +44 20 7930 9030