Russia's Polyus sees reserves at giant Siberian deposit at 40 million oz of gold

FILE PHOTO: Pavel Grachev, Chief Executive Officer at Russia's largest gold producer Polyus, speaks during an interview in Moscow, Russia December 6, 2018. REUTERS/Maxim Shemetov/File Photo

MOSCOW (Reuters) - Russia's largest gold producer Polyus PLZL.MM on Thursday estimated reserves at the Sukhoi Log gold deposit in Siberia at 540 million tonnes of ore, containing 40 million troy ounces of gold.

Polyus and its partner bought the rights to develop Sukhoi Log, estimated to contain a fifth of Russia’s gold reserves, from the Russian state in 2017.

“We are pleased with the results yielded by our exploration programme at Sukhoi Log. The publication ... confirms Sukhoi Log’s position as one of the world’s highest-calibre gold deposits,” Pavel Grachev, Polyus chief executive, said in a statement.

The additional 40 million ounces of gold secures Polyus’ position as the world’s second-biggest gold mining company by attributable reserves, he added.

The company plans to provide the next update on Sukhoi Log by the end of 2020, with the announcement of pre-feasibility study results.

Polyus previously estimated the cost of the project at $2-2.5 billion. Last month it said it would buy the remaining 22% stake in the giant deposit that it does not already own from project partner Rostec for $128 million.

Reporting by Anastasia Lyrchikova and Polina Devitt; writing by Alexander Marrow and Polina Devitt; editing by Mark Potter