Tender postponed for Russian gold mine — Placer Dome, Barrick among companies expressing interest

The proposed tender for the Sukhoi Log gold deposit in northwestern Russia has been postponed until 1999 to allow foreign companies an opportunity to evaluate the project.

The regional government of Irkutsk, the territory in which the project is situated, had initially announced that the tender process for development rights would begin in September.

Several companies, including Placer Dome and Barrick Gold, are expected to apply for a licence to study Sukhoi Log. The licence will be valid until the end of 1998, when the regional government will launch a tender process to sell its 49% interest.

In 1975, Russian geologists estimated the deposit contains 1,100 tonnes of gold. Placer Dome says development would take six years and cost US$750 million.

In 1994, Sukhoi Log was slated to be mined by Russian-based Lenzoloto, but its licence was revoked by the regional government in 1997. The company holds a 26% interest in the deposit, with the remainder held by employees (10%), the local government (5%), a state-owned firm (5%) and an Australian company (5%).

Meanwhile, the government of Khabarovsk, a territory in eastern Russia, is moving ahead with plans to sell rights to the Mnogovershinnoye gold deposit.

The deposit comprises three zones, the richest of which contains a resource of 1.1 million tonnes grading 21.7 grams gold per tonne. The remaining zones host 3.6 million tonnes grading 6.4 grams and 8.4 million tonnes grading 9.5 grams.

According to guidelines, the successful candidate must be able to produce up to 400,000 tonnes of ore in 1999, increasing to 600,000 tonnes in 2000. In 1994, cash costs at the operation stood at US$270 per oz.

Workings at the mine include an open pit and three adits, the deepest of which is 440 metres below surface. The gold is reported to be hosted in either quartz or sulphides.

— With files from Interfax News Agency.