The Russian gold mining company Buryatzoloto and its partial owner, High River Gold (HRG-T), have arranged financing to develop three gold mines in Buryatia, Siberia.
The mines, known as Zun-Holba, Braun-Holba and Irokinda, will be developed over three years.
A private placement will raise US$7.5 million in proceeds, while US$17.5 million in both debt and equity financing will come from the European Bank for Reconstruction and Development (the Western monetary fund set up to bankroll economic recovery in the former East Bloc). Another US$5 million in working capital will be available from metal trader Gerald Metals.
The financing has yet to be approved by the Russian government.
Buryatzoloto produced 59,565 oz. gold in 1995, mainly from the Zun-Holba deposit, which has proven and probable reserves of 7.5 million tonnes grading 11.2 grams gold per tonne.
The production estimate for 1996 is 77,000 oz., and development plans call for mill expansion and increased mine capacity.
High River holds a 22.9% interest in Buryatzoloto, and the new placement will maintain that level of ownership. The Russian company will next seek a listing on the international stock market.
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