Download 2004 Annual Report - Polymetal

Igor V. Venatovsky,First Deputy CEOYury E. Malakh,Deputy CEO forMaterialand Technical SuppliesProductionReviewIn 2004, the company demon−strated significant productiongrowth.Polymetal production assetsThe reported period marked akey chapter in the company’sdevelopment. Existing plantsreached their project capacities.An ore mining and metallurgyplant was opened at the Khakan−jinskoye deposit and Stage IIof the Vorontsovskoye depos−it was launched. As a result,Polymetal achieved its productiontargets for 2004. Next year willbe the first year that all the mainproduction plants will operate attheir project capacities.Company Region Deposit Ore Production methodMagadan SilverSilver TerritoryOkhotsk Mining andGeological CompanyNorthern Urals GoldMagadanRegionMagadanRegionKhabarovskDistrictSverdlovskRegionDukatLunnoyeKhakanjinskoyeVorontsovskoyevein zones and veins of quartz sulfide, quartzchloride adularia, and quartz rodonitevein zones and veinsof quartz carbonate and rodonitequartz gold and silver oreswith manganeseoxidized (loose) ores and primary goldsulfide vein impregnated oresopen−pit and undergroundminingopen−pit mining and under−ground mining from 2007open−pit mining and under−ground mining from 2009open−pit miningOre production rose by 57%compared to 2003 and reached2,688,000 tons. Ore process−ing was 2,142,000 tons, a 30%increase from 2003. The ratioof ore produced by open−pit andunderground mining in 2004 wasrelatively unchanged from 2003figures (85 and 87% respectively).However, in coming years, with thestart of underground mining atthe Lunnoye and Khakanjinskoyedeposits, ore production from un−derground mining will increase.The launch of the Khakanjinskoyedeposit helped increase goldproduction by 55% comparedto 2003. Production reached212,000 oz. Silver productiongrew by 47% compared to 2003and was 17,300,000 oz, primarilybecause of the Dukat and Lunnoyedeposits.Indicator Meas. unit 2004 2003 2004/2003Total rock mined m 3 7 883 880 6 070 892 29,9%including stripping m 3 6 536 454 5 244 559 24,6%Ore minedOpen−pit miningNote:2003 production takes into account the Barun−Kholba deposit (sold in 2004).m 3 1 262 588 826 333 52,8%th. tons 2 687 823 1 716 425 56,6%m 3 1 114 636 742 186 50,2%th. tons 2 296 114 1 492 255 53,9%Underground miningm 3 147 952 84 147 75,8%th. tons 391 709 224 170 74,7%Ore processed th. tons 2 141 635 1 653 813 29,5%Au production th. oz. 212 137 54,7%Ag production th. oz. 17 287 11 762 47,0%Au sold th. oz. 213 129 65,6%Ag sold th. oz. 17 301 9 839 75,8%2shipment of finished products (cement gold and silver and in Dore bars) from production facilities to refineriesProduction Review13