Nordgold Reports FY 2011 Operational Results

Nordgold (LSE: NORD), an established pure-play gold producer focussed on emerging markets, announces its production results for the quarter and the full year ended 31 December 2011.

Operational Highlights

  • Q4 production at 204 thousand gold equivalent ounces («koz»), 14% ahead of Q3 2011
  • YTD production at 754 koz, 28% ahead of the same period last year and on the upper end of the guidance
  • Extensive capex programme delivering strong progress:
    • Bissa project construction in Burkina Faso progressing rapidly with engineering works mostly completed ; on track to deliver first gold in H1 2013
    • Gross project in Russia scheduled to complete pre-feasibility phase soon
    • Exploration activity with a approximately spend of $124m for the year and the new Mineral Expert Report to be published in Q1 2012
  • On track to deliver record production for 2012 of 800-850 koz
“2011 has been a year of significant progress for Nordgold. We successfully completed the corporate separation from OAO Severstal and listed GDRs on the London Stock Exchange whilst continuing to grow and build an attractive investment proposition. The full year results demonstrate very clearly Nordgold’s key strengths and reflect our ability to create significant value from emerging markets assets” Philip Baum

“Nordgold continues to deliver strong production growth from its current portfolio of producing mines and remains on track to deliver record production for the fifth consecutive year. This has been achieved through a combination of acquisition and our strategy of operational optimisation. Since acquiring assets we have significantly increased investment in order to de-bottleneck the operations. At the same time we continue to invest heavily in exploration and our two lead development projects: Bissa, and Gross. When these projects come on stream in 2013 we should see a further change in Nordgold’s production profile. We remain on track to meet our production target of one million ounces of gold in 2013.” Nikolai ZelenskiCEO of Nordgold



+31 20 406 4480
Alexey Shchedrin, Financial communications and IR
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Sergei Loktionov, Media Relations
+7 916 800 1409

FTI Consulting

Ben Brewerton / Chris Welsh — London
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Oleg Leonov / Maria Shiryaevskaya — Moscow
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Notes to Editors

Nordgold is an established pure-play gold producer focussed on emerging markets and is a wholly-owned indirect subsidiary of OAO Severstal.

Nordgold’s production in 2010 was 589 koz of gold with revenue US$754 and generated EBITDA US$377 million.

As of 1 November 2010, the company’s resource base consisted of 23.0 moz of gold resources on a fully consolidated basis and 103 moz of silver resources (represented by a 50.0% interest in the Prognoz silver deposit) classified as measured, indicated and inferred according to JORC and 8.9 moz of proven and probable gold reserves according to JORC.

Nordgold organizes its business into eight reporting segments across three regions:

West Africa:

Somita: This segment comprises the Taparko mine in Burkina Faso, an open pit gold mine consisting of three open pit deposits. In 2010, this segment generated EBITDA of US$106 million and production of 127 koz of gold. Somita’s JORC compliant resources amount to approximately 0.9 moz of gold as of 1 November 2010.

Crew Gold: This segment comprises the Lefa mine in Guinea, an open pit gold mine consisting of two open pit deposits. Nordgold achieved 100% control over Crew Gold Corporation («Crew Gold») in January 2011. In 2010 the mine produced 73 koz of gold. LEFA’s JORC compliant resources amount to approximately 5.6 moz of gold as of 1 November 2010.

Development West Africa: This segment comprises a number of projects in the development and exploration stage located in West Africa. The key development project in West Africa is at Bissa, which is expected to begin production in 2013. The company also has over 30 exploration permits in Burkina Faso, where exploration works are being carried out, and assessment of exploration potential at licence areas that belong to Crew Gold in Guinea is currently underway.


Celtic and Semgeo: This segment comprises the Suzdal underground gold mine in Kazakhstan and gold deposits in the auxiliary open pit gold mines of Zherek and Balazhal in the vicinity of Suzdal, which are currently under technological review. In 2010, this segment generated EBITDA of US$58.9 million and production of 87 koz of gold. Suzdal’s JORC compliant resources amount to 1.4 moz of gold as of 1 November 2010 with Zherek and Balazhal adding approximately 0.8 moz of measured, indicated and inferred resources.


Berezitovy: This segment comprises an open pit gold mine located in the Amur region of the Russian Federation. In 2010, this segment generated EBITDA of US$32 million and production of 71 koz of gold. Berezitovy’s JORC compliant resources amount to approximately 1.4 moz of gold as of 1 November 2010.

Buryatzoloto: This segment comprises the operations of Zun-Holba and Irokinda, two underground gold mines, located in the Buryatia Republic of the Russian Federation. In 2010, this segment generated EBITDA of US$91 million and production of 136 koz of gold. Their combined JORC compliant resources amount to approximately 0.4 moz of gold as of 1 November 2010.

Neryungri-Metallic and Aprelkovo: This segment comprises open pit gold mines in the Republic of Yakutia and Transbaikal region of the Russian Federation. In 2010, this segment generated EBITDA of US$54 million and production of 94 koz of gold. Their combined JORC compliant resources amount to approximately 3.1 moz of gold as of 1 November 2010.

Development Russia: This segment comprises mines in the exploration and evaluation stage located in the Russian Federation. The primary focus of this segment is the Gross project.

The Company has two development projects and a large number of exploration projects and licences. The key development projects are Gross and Bissa.

Bissa: Located in Burkina Faso, Bissa is an actionable late-stage development project which is expected to contribute 93 koz and 161 koz of production in 2013 and 2014, respectively. Bissa’s JORC compliant resources amount to approximately 2.9 moz of gold as of 1 November 2010.

Gross: Located four kilometres from the Neryungri mine in the Republic of Yakutia in the Russian Federation, Gross is a development project expected to contribute 61 koz and 110 koz of production in 2013 and 2014, respectively. Gross’s JORC compliant resources amount to approximately 5.4 moz of gold as of 1 November 2010.

Key exploration projects include the LEFA and Banora corridors in Guinea, Bouly, Zinigma, Gougre and Labola in Burkina Faso and Prognoz, Nerchinsk, Uryakh and Vitimkan in Russia. Prognoz, located in the Republic of Yakutia in the Russian Federation, 444 kilometres north of Yakutsk, is one of the largest high grade undeveloped primary silver deposits in the world with current JORC compliant resources of 205 moz of silver. Management believes that the significant existing resource base has further exploration potential. The Company holds its interest in Prognoz through its 72.6% per cent interest in High River Gold, which in turn indirectly holds a 50.0% interest in Prognoz.


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