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Alrosa, Polyus eye cooperation with Sakha Republic for Russian gold projects

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Alrosa, Polyus eye cooperation with Sakha Republic for Russian gold projects

PJSC Polyus, PJSC Alrosa and the Republic of Sakha signed a cooperation agreement on Dec. 13 for the potential development of the Far Eastern Russian republic's electrical power infrastructure, and exploring further development of the Srednebotuobinskoye oil and gas field and the Svetlinksaya hydropower plant.

The parties signed an agreement at the Days of the Far East festival in Moscow aimed at exploring reliable energy supply for promising investment projects in the Bodaybo district of the Irkutsk region, including Russia's largest untapped gold deposit.

As part of the agreement, they will consider building a power plant in Yakutia, fired mainly by OJSC ALROSA-Gaz's Srednebotuobinskoye oil and gas condensate field, which could supply Polyus's Sukhoi Log and Chertovo Koryto projects in northeastern Irkutsk Oblast, where the gold miner faces a power shortage.

Polyus estimates that Sukhoi Log has primary reserves and resources of 58 million ounces, with production set to begin in 2026. Meanwhile, nearby Chertovo Koryto, which is 170 kilometers from Polyus's most recently launched Verninskoye mine, also lies on the same gold belt in the Bodaybo district and has 3.6 Moz of primary reserves and resources.

Another option is increasing the Svetlinskaya hydropower plant's capacity by adding a fourth turbine. More wells could also be commissioned at the Srednebotuobinskoye field.

The proposed gas plant is just one option for supplying Sukhoi Log with electricity but is seen by Polyus as the least capital-intensive and most manageable option, Interfax reported citing the gold miner's CEO Pavel Grachev.

The plant's capacity would be sufficient to fully power the Sukhoi Log project, which is still subject to a favorable investment decision, Grachev added.

Alrosa has retained its energy assets and is not thinking of selling them, the diamond miner's CEO Sergei Ivanov told reporters, according to Interfax.

The Sakha Republic is interested in the development of the energy sector, the continuation of the socioeconomic development of the region, and further reduction of electricity tariff growth rates, according to a statement on its website.

Alrosa shares closed up 3.1% at 98.14 rubles on Dec. 13 in Moscow, while Polyus shares finished the day up 2.5% at 4,999 rubles.

As of Dec. 12, US$1 was equivalent to 66.34 Russian rubles.