The Group was established on the basis of assets owned by Uzhuralzoloto Enterprise, a gold mining company in the South Ural region of Russia, which was established in 1976 and operated all of the gold mines in the Chelyabinsk region. In 1993, Uzhuralzoloto Enterprise was privatised and reorganised into OAO Uzhuralzoloto. From 1993 to 1997, during the period of overall decline in the Russian economy, the performance of OAO Uzhuralzoloto deteriorated and, in May 1997, it ceased to operate.
In July 1997, the current management team led by Mr. Konstantin Strukov established ZAO Uzhuralzoloto, which acquired the principal assets of OAO Uzhuralzoloto, including the Kochkarskoe deposit, the Svetlinskoe deposit, the Artem Full Cycle Processing Plant and the Kochkarskaya Processing Plant. The current management team developed and implemented a programme to improve production efficiency, which resulted in an increase in production and a decrease in operating costs. At the initial stage of development, the Group focused on rehabilitation of mining operations at the Kochkarskoe and Svetlinskoe deposits.
In 2001, the Group acquired control over the Kommunar Subsidiary, which owns a licence for the development of the Kommunar deposit in the Republic of Khakassiya. In 2002, the Group acquired control over the Etkulzoloto Subsidiary, which owns a licence for the development of the Bereznyakovskoe deposit and commenced processing operations at a heap-leach facility at the Svetlinskoe deposit in the Chelyabinsk region.
In 2006, the Group obtained licences for the development of the South Kurasan and West Kurasan deposits in the Chelyabinsk region, the Turgayul river area at the Kommunar deposit in the Republic of Khakassiya, as well as control over the Drazhny Subsidiary, a company that owned licences for the development of the alluvial deposits in the Krasnoyarsk territory.
In 2007, the Group further expanded its mining assets through the acquisition of the Darasun Subsidiary, a company that owned licences for the development of the Darasun, Talatuy and Teremki deposits in the Zabaykalsk territory, from the subsidiary of Highland Gold Mining Ltd.
Creation of Further Growth Potential
During 2007-2008, the Group underwent internal restructuring whereby its mining and processing operations were consolidated under the Uzhuralzoloto Subsidiary with a view to simplifying the corporate structure, streamlining the shareholding structure and enhancing corporate governance.
In 2008, the Group purchased a licence for the geological surveying, exploration and mining of the Zaitsevskoye prospective area in the Chelyabinsk region through a state auction.
In 2009-2010, the Group completed the reconstruction of the Artem Full Cycle Processing Plant and commenced the construction of the Bereznyakovskaya Processing Plant in the Chelyabinsk region, which the Group’s management expects to be operational in the second quarter of 2013.
In 2010, the Group purchased licences for the geological surveying, exploration and mining of the North-Svetlinskoe, Altyntash and Naily prospective areas in the Chelyabinsk region through state auctions. In 2011, the Group acquired a licence for geological survey, development and mining at the Oseyskoe prospective area in the Chelyabinsk region through a state auction.