Oleg Mitvol, deputy head of the Federal Service for the Oversight of Natural Resources, said his service had revealed numerous violations by Yamalzoloto at its gold deposits in the Yamalo-Nenets Autonomous Area, as well as the company's failure to fulfill more than 20 provisions of its licensing agreement.
"All companies that have concluded license agreements must strictly comply with them, because sooner or later the state will ask them how they are fulfilling contract terms," Mitvol said at a meeting with the management of Peter Hambro Mining.
Peter Hambro Mining holds over 50 prospecting and mining licenses, with operations focused in Siberia. The UK firm produced 249,000 troy ounces of gold in 2005. Its subsidiary Yamalzoloto holds licenses to develop Novogodneye-Monto and Toupugol-Khanmeishorsky gold deposits in the Yamalo-Nenets Autonomous Area, northwest Siberia.
Mitvol also said Russia's environmental watchdog will seek from Peter Hambro and other Russian and foreign companies engaged in geological prospecting and mining in Russia that they increase the efficiency of mineral resource extraction as well as environmental safety, and comply with legislation.
At the same time, Pavel Maslovsky, deputy board chairman of Peter Hambro Mining, said the company will make every effort in the near future to rectify the violations revealed at the gold deposits being developed by Yamalzoloto.
Peter Hambro Mining acquired 90% of shares of Yamalzoloto in 2004. The Russian subsidiary's main asset is the license to develop the Novogodneye-Monto gold ore deposit, which has estimated reserves of 90 metric tons of gold (2.89 million troy ounces).
The management of Peter Hambro Mining also said the company was prepared to voluntarily transfer the license to develop the Novogodneye-Monto deposit to another mining company, if it fails to comply with the terms of its license agreement.
