July 26, 2018 / 10:11 PM / a month ago

India's Sun Gold, China National Gold to go ahead with Siberian gold project

MOSCOW (Reuters) - India’s Sun Gold and China National Gold are launching a joint gold mining project in Russia’s Siberia region, the two companies said in a joint statement during a Johannesburg summit of BRICS member states.

In 2016, the sides agreed that Sun Gold would sell a 70-percent stake in the project, the Kluchevskoye gold deposit, to China National Gold, a major global gold producer. The Chinese gold company would in turn contribute its development expertise.

However, the deal was delayed for various reasons, including red tape issues in Russia.

A pre-production investment of up to $500 million is planned, the partners said in their statement, adding that China National Gold is expected to be the project’s major shareholder following its final ratification by the Duma, Russia’s lower house of parliament.

The Duma ratified the project on Thursday, according to the representative body’s public documents.

An open-pit mine is expected to be built at the Kluchevskoye deposit producing 6.5 tonnes of gold annually, the partners said. They did not disclose when the first gold was expected to be produced.

Reporting by Polina Devitt and Elena Fabrichnaya; editing by Kirsten Donovan

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