6 May 2010 10:56

Petropavlovsk lowers gold output by 37% in Q1

MOSCOW. May 6 (Interfax) - The management alliance Petropavlovsk, which develops gold and iron ore fields in Russia, lowered gold output by 37% year-on-year to 65,600 ounces in the first quarter of 2010, the company said in a statement.

For instance, the company's Pokrovsky mine reduced production by 27% year-on-year to 29,800 ounces while output at the Pioneer field decreased by 44% to 35,800 ounces of precious metals. The company said that the drop in ore production would be compensated in 2010 by an increase in output at its factory at the Pioneer field.

Petropavlovsk is holding on to its earlier announced production forecast for 2010: 670,000-760,000 ounces of gold largely through an increase in production at factory at the Pioneer field (in April, 200,000 tonnes per month to 455,000 tonnes) and the start of production at Malomyr in the second half of 2010. Production at Malomyr is forecast at 700,000 tonnes per year (gold output for 2010 is estimated at 68,000-100,000 ounces).

In 2009, Petropavlovsk increased production by 21% to 486,800 ounces (15,139 tonnes). The company's expenses came to $309 per ounce. The average gold price increased last year by 15% o $975 per ounce.

Petropavlovsk plc was set up through a merger between gold producer Peter Hambro Mining plc and minerals company Aricom plc in 2009. The merger created one of the leading mining companies in Russia's Far East.