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UPDATE 1-Russia gold output up 18.5 pct in Jan-Aug-lobby

* Eight-month gold output rises to 126.42 tonnes

* Increase led by Kinross Gold, Peter Hambro Mining

* Krasnoyarsk was top producing region

(Adds details, background)

MOSCOW, Oct 1 (Reuters) - Russian gold production rose 18.5 percent year-on-year in the first eight months of 2009, mainly due to the launch of some large projects in the far east, the Russian Gold Industrialists’ Union, said on Thursday.

The Union, the industry lobby, said in a statement gold output by the world’s No.5 miner of the yellow metal totalled 126.42 tonnes in January-August compared to 106.69 tonnes in the same period a year ago.

It said gold otput from mines accounted for most of the 1.39 tonne rise in August from August 2008, while output from gravel deposits, termed placers, was practically the same as a year ago.

Production of gold from mines and placers in the first eight months of 2009 rose 18.4 percent year-on-year to 111.28 tonnes, the Union said.

Output achieved by refining gold from scrap rose 1.9 percent to 4.74 tonnes and gold produced as a by-product of other metals rose 29.3 percent to 10.40 tonnes.

Russia produced about 8 percent of the world’s gold last year and plans to significantly increase this share by developing its reserves that are second only to South Africa’s.

The union attributed the latest increase to the launch of production at Kinross Gold's K.TO Kupol mine in the remote Chukotka region, as well as the Karalveyem mine in the same region.

Peter Hambro Mining's POG.L Pioneer project and High River Gold's HLGC.TO Berezitovy mine in Amur region and the Aginskoye project, run by Kamgold on the far eastern peninsula of Kamchatka, also contributed to the rise, the Union said.

The biggest producing region in January-August was Krasnoyarsk, where the country's top producer Polyus Gold PLZL.MM operates the Olympiada mine.

Chukotka, a region governed until last year by billionaire Roman Abramovich, was the second and far eastern regions of Amur, Yakutia and Khabarovsk were third, fourth and fifth respectively in terms of production, the Union said. (Reporting by Aleksandras Budrys)

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