Metropol to invest $36 mln in Ozernoye mine in 2007

Metropol to invest $36 mln in Ozernoye mine in 2007

Investment in the construction of a mine and concentrating plant at the Ozernoye lead-zinc fields in Buryatia will total $36 million in 2007, Oleg Mikhailichenko, general director of the Metropol financial group’s East Siberia Metals corporation, told reporters.

“We’ve already started to build the mine. The $36 million has been endorsed for this year, but overall investment will run to $430 million,” Mikhailichenko said.

Mikhailichenko said the project would take up to three years to deliver, and that infrastructure was being put in place and surveying carried out at present.

He said shareholders would provide around 40% of the capital and the rest would be raised on the financial markets.

The company will name a financial consultant in around two weeks, Mikhailichenko said. He said the company planned to borrow on the markets in 2008-2009.

Mikhailichenko also said the corporation expected to acquire a license to explore the Ozerninsky mineralization, thought to contain a considerable iron ore reserves, silver and some gold.

East Siberia Metals owns 51% and Lundin Mining 49% of OJSC Ozerny GOK, which is carrying the Ozernoye project out, Mikhailichenko said.

The Ozernoye polymetal deposit, one of the largest in the world in terms of zinc reserves, has mineral resources of 157 million tonnes with an ore grading of about 5.2% for zinc.

The deposit, located 300 km northeast of Ulan-Ude, was surveyed in the 1970s and 1980s, but commercial mining was never conducted.


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