Russian Nature Ministry audits mining licenses

Russia’s Natural Resource Ministry’s environmental watchdog Rosprirodnadzor has begun examining the performance of the British company Peter Hambro Mining (PHM) in fulfilling its licensing agreements for the exploration and extraction of gold and titanium-magnesium ore in Russia.

In 2006, Rosprirodnadzor examined the execution of five licensing agreements issued to Peter Hambro Mining and the inspectors found considerable deviations from the licensing agreements, the watchdog’s statement recently said

Oleg Mitvol, deputy head of the Natural Resources Ministry’s environmental watchdog, has submitted to Russia’s Federal Subsoil Resource Use Agency an application for the withdrawal of the agreements, the statement said.

According to Rosprirodnadzor, the company, which has over 50 licenses for the exploration and extraction of ore, either does not adhere to the contracts’ conditions or is delinquent in their fulfillment of them. Besides the project’s documentation was not submitted on time.

The violations include the delinquency of documentation for the Novogodneye-Monto deposit in the Yamalo-Nenets region, as well as the omission of documents describing the project’s site exploration and extraction and several accounting documents. The examination also revealed that the company’s subsidiaries did not provide the federal authorities with information regarding the work performed on the deposit.

The examination of other licensing agreements issued to Peter Hambro Mining and its subsidiaries, which include those corresponding to the Uralmagnit, Pokrovsky Rudnik, and Yamalzoloto sites, will be performed in the near future, the statement noted.

According to general Director of PHM’s management company Sergei Yermolayenko, no supervisory organizations hold any responsibility over the company, the Kommersant reported. ”Check-ups are held regularly at our company and its subsidiaries, and the latest large-scale examination was performed in April 2005, with supervisory inspectors not filing any complaints,” Yermolayenko was quoted by the newspaper as saying.

Meanwhile, on Tuesday PHM’s subsidiary AmurMining won a tender for exploring the Garinsky iron and ore deposits in the Amur region, www.amurinfo.com said. The bidders for this project included seven companies, with AmurMining offering the highest sum of 500 million rubles ($19 million). AmurMining has won the right to extract the ore at the site for a 20-year period, though the length of the contract can be altered.

Peter Hambro Mining is the second largest company in terms of the volume of gold mined in Russia. The company’s major resource base is located in the Amur region. It also mines gold in Magadan, Chita and Yamalo-Nenets regions and Yakutia. The company’s chief asset is Pokrovsky Rudnik Ltd., which is currently exploring gold ore deposits in the Amur region.