Polyus : Sukhoi Log update and pre-feasibility study results, November 2020

SUKHOI LOG UPDATE AND PRE-FEASIBILITY STUDY RESULTS

NOVEMBER 2020

ASSET OVERVIEW

BY JORC

RESERVES

• 1globally

JORC P&P

RESERVES

40moz at 2.3g/t

JORC

RESOURCES

67moz at 1.9g/t

6 km

SUKHOI LOG	Verninskoye
	Kropotkin

145 km

Alluvials

Bodaybo

Taksimo

Irkutsk region

CLOSE PROXIMITY TO OTHER POLYUS ASSETS СREATES OPPORTUNITIES FOR:

Potential economies	Utilisation of existing
of scale	infrastructure

2

SUKHOI LOG CONSOLIDATION

2016-2017	2017-2020	2020

PAYMENT

AMOUNT

cash

equity ($ equivalent)

In 2016, Polyus and "Rostec Business Development" ("RT") established SL Gold in order to participate in the Sukhoi Log auction process.

In January 2017, SL Gold submitted the highest bid during the auction in a total amount of ca. $153 mln

In February 2017, SL Gold

was granted a development license.

$ 153 mln

Polyus entered into a number of cash and equity option agreements with RT to consolidate 100% in SL Gold

Polyus acquired a 13.2% stake

for ca. $76.4 mln under cash option agreements and a 13.8% stake for ca. $80.3 mln, which were paid in Polyus' shares.

$ 76.4 mln $ 80.3 mln

In September 2020, Polyus exercised its right to accelerate the buy-out of RT participation interest in SL Gold, converting outstanding equity options into cash obligations

$ 128.2 mln

$ 438MLN

total amount paid

for the Sukhoi Log license

OWNERSHIP

STRUCTURE

Polyus

Rostec

Business Development

49%				51%	22%				78%

100%

3

DRILLING CAMPAIGN

OUTCOMES

1

DATASET FOR R&R ESTIMATES

DRILLING DATASET / ESTIMATE BASE

2017

2017-2018

2018-2019

2020

HISTORIC DRILLING

POLYUS VERIFICATION

POLYUS EXPLORATION

TOTAL

DRILING PROGRAM

DRILING PROGRAM

DRILLING

324 km

DRILLING

46 km

DRILLING

158 km

DRILLING

528 km

1,185drillholes

111 drillholes

523 drillholes

1,819drillholes

DRILLHOLES MAP

Historic drillholes

Verification and exploration drilling

Open pit shell

5

MI&I RESOURCES AND P&P RESERVES ESTIMATES

MI&I RESOURCES

2017

2020

TONNES

GRADE

GOLD

TONNES

GRADE

GOLD

887mt

2.03g/t

58moz

1,110mt

1.9g/t

67 moz

Indicated

668 mt

2.1 g/t

46 moz

Inferred

441 mt

1.5 g/t

21 moz

P&P RESERVES

100% Inferred

69% Indicated

31% Inferred

2017

2020

TONNES

GRADE

GOLD

No data

540mt

2.3g/t

40moz

100% Probable

The 2020 Ore Reserve Estimate is the maiden reserve estimate for Sukhoi Log

• probable ore reserves reported

The estimate is

• based on Mineral Resources update as at 31 May 2020
• supported by studies completed by AMC and Wood as part of the PFS

6

VERIFICATION AND EXPLORATION

RESOURCE CATEGORY UPGRADE

2017

2020

NN

Inferred

Inferred

Indicated

pit shell

N N

Inferred

Indicated

Inferred

Verification and exploration drilling produced more comprehensive data on the structure and distribution of the gold in the ore body

A higher density of drillholes and modern analytical techniques applied to a combination of the verification and exploration results and historical data made it possible to determine indicated resources, and, upon demonstration of their economic viability, probable reserves

7

VERIFICATION AND EXPLORATION

ORE BODY REVIEW

2017	2020
N		N

The North-Western part of the ore body was not included into the ultimate pit due to increased depth and lower grades

vs historic data

2017 model pit 2020 model pit

N N

The depth of the central part of the ore body

extended by 100 m

in a North-Easterly direction

2017 Resource pit shell

2020 Resource pit shell

8

GEOTECHNICAL & HYDROGEOLOGICAL DRILLING & SURVEYS

IN DECEMBER 2019, THE COMPANY COMPLETED 18.3 KM DRILLING

FOR THE ENGINEERING AND GEOLOGICAL SURVEYS

GEOTECHNICAL DRILLING

The geotechnical drilling and survey were conducted to establish inputs for the design of the open pit structures

HYDROGEOLOGICAL DRILLING

The hydrogeological drilling and survey describe groundwater behaviour, inflow-rates and inform the design of mine dewatering operations

TOTALTOTAL

10.9 KM	7.4 KM
including	including
5.4 km in 2019	2.8 km in 2019

			2018 drillholes				2018 drillholes
			2019 drillholes				2019 drillholes

BOTH STUDIES ARE EXPECTED TO BE FINALIZED BY THE END OF 2020,

AND WILL BE UTILIZED AT THE FEASIBILITY STUDY STAGE

9

DRILLING - NEXT STEPS: 2020 PROGRAMME

IN 2020, DRILLING HAS BEEN CONTINUED WITH FURTHER IN-FILL DRILLING

AND DEEP LEVEL AND FLANK EXPLORATION

	IN-FILL DRILLING		DEEP-LEVEL DRILLING AND FLANK EXPLORATION
	35 KM	DRILLING PATTERN 50х50 M			25 KM	DRILLING PATTERN 400х200 M

In 3Q'20, Polyus completed its in-fill drilling programme for 2020 with 35,200 meters drilled, compared to the 30,000 meters initially planned.

The drilling works were focused on the future pit area, where Polyus expects to carry out mining activities during the first years of Sukhoi Log's operations.

This will allow the Company to better define the gold mineralisation within this area and enable more accurate planning and sequencing of the mining works

Polyus also performs additional deep-level drilling aimed at estimating resources below the +290 horizon as it has become evident that the ore body extends below the current limits of the exploration drilling

+1,170 mrl

Cross-cut view

The license for flank exploration was acquired in 2018. Flank exploration focused on the Northern and Eastern parts of the ore body will confirm the dimensional limits of the ore body and explore potential satellite ore formations

Adjacent license border line

Initial license border line

in-fill drillholes

Verification and exploration drilling limit +290 mrl

[-35 mrl]

new, deep-level drillholes		flank exploration drillholes

GEOTECHNICAL DRILLING

	The Company decided to roll out an additional 3 km geotechnical drilling programme aimed at assessment
3 KM
of the future pit wall stability. The results of this programme will be used for the Feasibility Study

10

PRE-FEASIBILITY

STUDY HIGHLIGHTS

2

PRE-FEASIBILITY- SITE LAYOUT

A conceptual site layout was developed for the PFS and will be developed further at the later stages of the project's feasibility assessment

NORTH WASTE DUMP

CRUSHING BUILDING

MAINTENANCE BUILDING

DRY TAILINGS STORAGE

OPEN PIT

TAILINGS STORAGE FACILITY

SOUTH WASTE DUMP

PROCESS PLANT

TRUCK SHOP

PERMANENT CAMP

12

OPEN PIT OVERVIEW

The PFS determined the key features of the main pit to enable high volume mining:

Dimensions of 3.5 km along strike and 1.8 km across strike

Overall pit slope angles of 23° in the footwall and from 41° to 47° in the hanging wall

15 m high benches1

Continuous dual-lane access

The PFS design assumes that the mining of the main open pit will be performed

in a series of 5 nested stages, sharing a common footwall

1 - Preblast bench height

2 - Average for the first 10 years of operation 3 - As per JORC report

KEY MINING METRICS

168 mtpa		33.2 mtpa		3.252 t:t	2.33 g/t		up to 2.4 g/t
MATERIAL		PLANT		STRIP RATIO		AVERAGE GRADE		PLANT FEED
MINING RATE,		FEED RATE		(WASTE-TO-ORE)		IN MINED ORE		GRADE FOR THE
RUN RATE								FIRST 10 YEARS

ULTIMATE MAIN OPEN PIT		OPEN PIT
DIMENSIONS		STAGES
		Zapadnoye		Stage 1
				Stage 2
		Main Pit		Stage 3
				Stage 4
		Common		Stage 5
		Footwall
		Ramp

13

MINING EQUIPMENT

100 TONNES (50 M3) NOMINAL PAYLOAD SHOVELS

300T TRUCK

Highly cost-efficient	Utilized at peer gold assets
and reliable for 15 m benches	(Penasquito, Cortez, Blackwater)

Available from all major suppliers	Highly	Supplied by Hitachi, CAT,	Widely used globally, mainly on copper
(P&H (Komatsu), WK and CAT)	cost-efficient	Liebherr, Komatsu, Belaz	or copper-molybdenum mines

460

rope shovels

haul trucks

2

hydraulic excavators

The PFS assumes that the characteristics of Sukhoi Log ore distribution favors selection of higher bench height (15m) and larger mining unit 25 m x 25 m x 15 m

Lower unit mining cost and schedule benefits currently outweigh	The decision on specific shovel	The final decision on mining
the impacts of higher dilution and ore loss for the large equipment,	and truck models	equipment sizing will be made
compared to using smaller equipment and lower bench heights	is driven by the bench height	at the Feasibility Study stage

14

MINING EQUIPMENT COMPARISON

The mining fleet assumed in the Sukhoi Log PFS is expected to be one of the largest in terms of capacity globally.

This reflects a combination of high bench height and high overall mining rate (168 mtpa)

SHOVELS

Bench Height, m

	15	15	12	12	15	15		15	12	15				Shovel's average
10					10			10	10		capacity, m3
									6	10
68
	50	49	45	45	43	39
			36
					35	34	33
											22	21	15	14
METATES	SUKHOI	PENASQUITO	BLACK-	PARACATU	NEW	CORTEZ	LIVENGOOD	OLIMPIADA	DETOUR	VELADERO	LAGUNAS	ROUND	TARKWA	LOS FILOS
	LOG		WATER		PROSPE-				LAKE		NORTE	MOUNTAIN
					RITY
TRUCKS

15		15		15	15	15	15							Bench Height, m
12	12		12					Trucks' average
10	10				10	10	10
									load capacity, t

331	327												6
300	300
		290	290	268
							222	220	218	213	181
											166	156
													130
CORTEZ	METATES	DETOUR	SUKHOI	LIVENGOOD	BLACK-	PENASQUITO	NEW	OLIMPIADA	VELADERO	ROUND	LAGUNAS	PARACATU	TARKWA	LOS FILOS
		LAKE	LOG		WATER		PROSPE-			MOUNTAIN	NORTE
							RITY							15

PROCESSING FLOWSHEET DESIGN

CONVENTIONAL GRAVITY - FLOTATION SCHEME

BALL MILL

FLOTATION PEBBLECRUSHER (SABC)

SAG MILL	GRAVITY	FLASHFLOTATION

CYANIDATION

CARBON-IN-LEACH

33.2MT

average annual throughput capacity

92%

average recovery rate

2.3G/T

average grade in ore processed (P&P reserves)

ELECTROWINNING

SMELTING

2.3MOZ

average annual gold production,

LOM JORC

16

PROCESS PLANT DESIGN

3D PROCESS PLANT MODEL

ORE PREPARATION		COARSE ORE STOCKPILE		PROCESS PLANT

GRINDING		FLOTATION		CYCLONING & GRAVITY SEPARATION

FLOTATION TAILINGS THICKENING		DESORPTION / RECOVERY		DESORPTION / RECOVERY

17

COMMINUTION SCHEME

		NOMINAL
	THROUGHPUT
	33.2 mtpa

PRIMARY CRUSHING

The PFS assumed the application of gyratory crushing based on the potential size of operations, ore hardness and the availability of commercial equipment

A gyratory crusher is in operation at Natalka

GYRATORY CRUSHER

QUANTITY

x2

SECONDARY CRUSHING

A conventional Semi-Autogenious Ball Pebble-Crusher scheme was selected for the PFS based on the hardness of the ore and the availability and relative affordability of energy supply

BALL MILL

QUANTITY DIMENTIONS

x2 7.6× 11.9 m

SAG MILL

QUANTITY DIMENSIONS

x1 12.2 × 8.6 m

18

MILLING RATE BENCHMARKING

The configuration and size of the mills for secondary crushing (2 x 40ft SAG and 4 x 25ft Ball mills) proposed

in the PFS are conventional - all major manufacturers supply large SAG mills up to 40ft

This size of processing and milling equipment is common for copper and porphyry (gold-copper) mills.

THROUGHPUT CAPACITY (MTPA)

Primary commodity:	Gold	Copper	Porphyry
SAG mill
(ft*quantity)						40X2
40x3	40x2		40x1	40x1	40x2				40x1
							34x3	36x2	36x2
Ball mill
(ft*quantity)	28x2		28x2	28x1
26x4			25X4		26x2	26x2
				24x4	24x2
							22x2
85
	55
			42	40
				36
					33
						30
							25
								20	20
COBRE	SENTINEL	TOROMOCHO	FRIEDA	KING-KING	SUKHOI	TUJUN	NORTH-	CONSTANCIA	CADIA
PANAMA				RIVER		LOG	BUKIT	PARKES
										19

GOLD EXTRACTION

SUKHOI LOG FLOWSHEET INCLUDES BEST-IN-CLASS TECHNOLOGIES FOR PROCESSING THIS TYPE OF ORE

GRAVITY AND FLASH FLOTATION

GRAVITY	FLASH FLOTATION
CONCENTRATORS	FLASH FLOTATION UNITS
x24	x8

FLOTATION AND CIL

FLOTATION	CARBON-IN-LEACH
FLOTATION MACHINES	CIL TANKS
x10 of 630 m3	x8 of 2,000 m3
x5 of 100 m3

Significant, but not excessive presence of gravity-recoverable gold

Conventional gravity-flotation scheme was selected for Sukhoi Log to maximize gravity gold recovery

• Combination of gravity and flash flotation results in lower losses at further processing stages
• At Blagodatnoye, Olimpiada and Natalka this combination demonstrates high efficiency

TECHNOLOGY ALREADY USED AT

Olimpiada

Blagodatnoye Natalka

Verninskoye Kuranakh

8 flash flotation units installed

in 2017-2020 across the Company

Key benefits of flash-flotation technology

• Minimized overgrinding
• Improved recovery

A significant portion of gold associated with pyrite

• For higher gold recovery flotation circuit added

Large-volume flotation machines of 630 m3 ensure power efficiency

Polyus has high level of expertise in flotation of this type of ore, as it is similar to ore at Verninskoye

CIL with feed regrind and gravity pre- treatment included to improve efficiency

• Preg-robbing effect on recovery curtailed

A significant amount of organic carbon contained in ore

• Special reagent scheme selected to decrease effect of organic carbon at CIL stage keeping high recovery rate

CN dual stage detox introduced for complete decomposition of all cyanogen compounds

20

RECOVERY ESTIMATE BASED ON TESTWORK PROGRAMME

The samples for testwork originated from contiguous drill core samples to specifically cover as much of the entire ore body as possible and include the expected range of grades the processing plant would see, with a focus on better coverage of the high grades.

From October 2018 to November 2019, a total of 64 mapping samples were tested in the SGS lab.

TESTS RESULTS:

2.05 g/t

Average grade in ore

92%

Recovery rate for the PFS (with 80% confidence)

RECOVERY (AFTER DERATING),

%

100		Average grade
	2.05 g/t

95

Recovery rate 92%

90

85

80

75

AVERAGE GRADE IN ORE, G/T

70

0.0

1.0

2.0

3.0

4.0

5.0

6.0

21

SUKHOI LOG VS. CURRENTLY OPERATING POLYUS MINES

THE SCALE OF OPERATIONS AT SUKHOI LOG IS COMPARABLE

WITH CURRENTLY OPERATING POLYUS MINES

TOTAL ROCK MOVED,

mln m3

The amount of total rock moved at Krasnoyarsk business unit (KBU) in 2019 exceeds the average material mining rate at Sukhoi Log by 23%

THROUGHPUT CAPACITY,

mtpa

Designed throughput capacity at Sukhoi Log is 45% higher than ore processed at KBU in 2019.

After commissioning of Mill #5 at Blagodatnoye (6-8 mtpa, currently at FS stage), Sukhoi Log throughput capacity will be ca. 10% higher than at KBU

AVERAGE ANNUAL PRODUCTION,

moz

SUKHOI LOG	60		33.2	2.3

KRASNOYARSK	74		22.9		1.8
BUSINESS UNIT1

OLIMPIADA1	50		13.9		1.4

BLAGODATNOYE1	24		9.0		0.4

NATALKA1	27		11.2		0.4

1 - Company's data for FY 2019	22

SUKHOI LOG VS OTHER GREENFIELDS1…

SUKHOI LOG IS THE LARGEST GREENFIELD		…WITH STRONG PRODUCTION PROFILE, LONG LIFE
ASSET IN TERMS OF GOLD RESERVES…		OF MINE AND ONE OF THE HIGHEST GRADES GLOBALLY

P&P				AVERAGE LOM ANNUAL	LOM		GRADE IN P&P
RESERVES				PRODUCTION		RESERVES
Moz					Moz									Years2		G/Tonne
	10	7												2.33 16
	ROSIA	COTE			SUKHOI LOG										SUKHOI LOG		2.3
11	MONTANA		34		KSM								1.3	26		KSM		2.1
NEW			DONLIN
PROSPERITY	40				DONLIN							0.8		28		DONLIN		1.5
9		18		NORTE ABIERTO						0.6		60		NORTE ABIERTO		1.0
SUKHOI LOG	METATES											20
LIVENGOOD					METATES						0.6			METATES		0.9
13			39		WAFI-GOLPU					0.5			20		WAFI-GOLPU		0.7
												41
WAFI-			KSM	NEW PROSPERITY				0.4			NEW PROSPERITY		0.6
GOLPU														20
	23			ROSIA MONTANA				0.4				ROSIA MONTANA		0.6
												41
	NORTE			LIVENGOOD			0.3					LIVENGOOD		0.5
	ABIERTO
			COTE		0.2				47		COTE		0.4

Source: SNL, companies' data
1	- Selection includes the largest assets by P&P gold reserves with gold as a primary commodity and with announced annual gold production capacity of at least 200 koz gold as per SNL
2	- Except for Sukhoi Log, LoM (Life of Mine) is calculated as reported gold reserves divided by announced LoM annual gold production. As for Sukhoi Log, LoM is based on reported gold reserves divided by reported average grade and production throughput
3	- Calculated based on JORC Reserves, LoM (see note 2) and recovery
23

SUKHOI LOG VS CURRENTLY OPERATING GOLD MINES1

SUKHOI LOG'S RESERVE BASE IS ONE OF THE LARGEST AMONG BOTH UNDERGROUND AND OPEN PIT OPERATIONS

SUKHOI LOG POSSESSES LEADING ANNUAL PRODUCTION CAPACITY ALONG WITH HIGH GRADE IN RESERVES

P&P

RESERVES

Moz

23
LIHIR
40	20
SUKHOI
CADIA
LOG
EAST	24
		OLIMPIADA
48	10
NEVADA	AHAFO
OPERATIONS3

15

	12	DETOUR
10	BODDINGTON	LAKE
15
PUEBLO
VIEHO	NATALKA

AVERAGE LOM ANNUAL

PRODUCTIONLOM

Moz										Years2
									3.0	16
NEVADA OPERATIONS3
SUKHOI LOG								2.3		16
OLIMPIADA							1.4			17
PUEBLO VIEJO						1.0				10
LIHIR					0.9				25
CADIA EAST					0.9				22
BODDINGTON				0.7				17
AHAFO			0.6					15
DETOUR LAKE			0.6					25
NATALKA		0.4					36

GRADE IN P&P

RESERVES

G/Tonne

OLIMPIADA2.8

PUEBLO VIEJO	2.5
SUKHOI LOG	2.3
LIHIR	2.3

AHAFO1.9

NATALKA1.7

NEVADA OPERATIONS3	1.5
DETOUR LAKE	1.0

BODDINGTON 0.7

CADIA EAST 0.2

Source: SNL, companies' data
1	- Selection includes the largest operating assets with gold as a primary commodity, with reported annual gold production of at least 250 koz gold in FY2019 and LoM more than 5 years. Excl. Muruntau due to the absence of reliable data.
2	- Except for Sukhoi Log, LoM (Life of Mine) is calculated as reported gold reserves divided by FY2019 gold production. As for Sukhoi Log, LoM is based on reported gold reserves divided by reported average grade and production throughput
3	- Nevada operations comprise 8 mines along with their associated infrastructure and processing facilities.
24

ECONOMIC

PARAMETERS

3

KEY PROJECT ECONOMIC METRICS

BASED ON PRE-FEASIBILITY STUDY1

PRELIMINARY GOLD PRODUCTION PROFILE

Grade in ore processed, g/t

2.4	2.4	2.4	2.4	2.4	2.4	2.4	2.3	2.3	2.3 g/t
1.8						2.2
									Average
									first 10y

MINING RATE		AVG. WASTE-	BASE THROUGH-
(AT PEAK)		TO-ORE RATIO	PUT CAPACITY
168 mtpa		3.252 t/t	33.2 mtpa

Production,		2.3	2.3	2.3	2.3	2.3	2.3				2.3
2.2	2.2		2.2
moz
0.8

2.3 moz

RESERVES		AVG. ANNUAL
(P&P)		PRODUCTION
40 moz at 2.3 g/t		~2.33 moz

Y0

Y1

Y2

Y3

Y4

Y5

Y6

Y7

Y8

Y9

Y10

KEY

MACROECONOMIC

TCC STRUCTURE

ASSUMPTIONS

390

$/OZ

MINING COST

PROCESSING COST

GOLD PRICE

59%

22%

18%

1%

$1.6/t

$13.5/t

$ 1,200/oz

PROCESSING

MINING

MINERAL

OTHER

PROJECT INITIAL

EXTRACTION

TAX

CONSTRUCTION CAPEX

FX

$ 3.3 bln

60 rub/usd

1	- Subject to optional review and detalisation at further project stages (Feasibility, Engineering, etc.)
2	- Average for the first 10 years of operation
3	- As per JORC reserve estimate
26

CAPITAL COSTS BREAKDOWN

The Estimated Initial Construction		CAPEX is estimated with Pre-Feasibility Study Class
CAPEX is in the range of $3.3 bln		4 estimate with the level of accuracy +/-20%

Capital costs are in real USD terms, as of the end of 2019

PROJECT INITIAL CONSTRUCTION CAPEX

CAPEX COMPONENTS,

$ bln

CONTINGENCY

0.4

of ca. 15% to cover unforeseeable items within the scope of the estimate

INDIRECT COSTS	$3.3bln		DIRECT COSTS
0.5		2.4
facilities, materials,			The costs of all equipment
services, equipmentand activities			and materials, together
required to support the project			with construction and
during the engineering,			installation costs for all
procurement, construction and			permanent facilities
preoperational testing phases

0.2

0.4

0.6

1.2

TAILINGS

INFRASTRUCTURE

MINING

PROCESS FACILITIES

27

CAPEX: ESTIMATE EVOLUTION

FROM SCOPING STUDY TO PRE-FEASIBILITY

+ $ 1.0bln

MINING	CAPACITY	FLOWSHEET	TAILINGS	INFLATION
		& INFRASTRUCTURE	$ 0.2 bln	$ 3.3 bln
			$ 0.2 bln
	$ 0.2 bln	$ 0.1 bln
		Inflation from 2017
$ 0.3 bln			Increased mining	to 2020
	Flowsheet modification:
	and processing capacity
$ 2.3 bln
Throughput capacity	• Addition of flash	driving increased
	increase from 30	flotation cells	infrastructure
Higher mining equipment	to 33.2 mtpa	• Modified equipment	requirements
CAPEX due to a comprehen-		characteristics based on	Item-by-item estimation
sive update of the mining
	testwork to date
	of the required on-site
plan with a focus on optimis-
		infrastructure
ing mining and stripping
volumes to ensure a smooth
ramp-up and optimal grades
in processing
Pre-production volumes
increased from 134
to 180 MT
Run-rate achieved in Year 2,
as opposed to Year 4
in Scoping Study

Initial Construction CAPEX Estimate based on Pre-Feasibility Study increased to $3.3 bln, or +$1.0 bln compared to Scoping Study Estimate

SCOPING STUDY	PRE-REASIBILITY STUDY
INITIAL CONSTRUCTION	INITIAL CONSTRUCTION
CAPEX	CAPEX

28

SUKHOI LOG СAPEX INTENSITY1

based on Pre-Feasibility estimate of capital expenditures, Sukhoi Log ranks favourably in CAPEX intensity and life of mine compared to other greenfield projects

TERMS OF LIFE OF MINE,

YEARS

Bubble size represents LoM avg. Au only production

60KSM

NEW

PROSPERITY

40

FRIEDA

CASINO

RIVER

DONLIN

NORTE

ABIERTO

JOSEMARIA

NUEVAUNION

COTE

MT TODD

NAMDINI

KINGKING

HARDROCK

ROSIA

20

MONTANA

VOLTA GRANDE

COURAGEOUS BACK

LOMA

SUKHOI LOG

HORNE 5

LIVENGOOD

LAKE

RIVER

EVANDER

LARGA BURITICA

PAUL

MASSAWA

JEANETTE

SALARES

BLACKWATER

NORTE

MAOLING

ISNARD

MAGINO

BOMBORE

PASSENDRO

CAPEX INTENSITY, $/OZ ANNUAL OUTPUT

0

5

10

15

20

25

30

35

Source: SNL, companies' data

1 - Selection includes projects with announced production capacity of at least 200 koz of gold as per SNL

29

PFS ESTIMATES VS. SCOPING STUDY

SCOPING STUDYPFS

THROUGHPUT CAPACITY	30.0MTPA	33.2MTPA

RECOVERY	88-90%	92%

TCC	$ 420-470/OZ	$ 390/OZ

INITIAL CONSTRUCTION CAPEX	$	2.3BLN	$ 3.3BLN

AVERAGE ANNUAL GOLD	1.6MOZ	2.3 MOZ
	1
PRODUCTION, LOM

1 - As per JORC reserve estimate

30

INFRASTRUCTURE

DEVELOPMENT

4

OFF-SITE INFRASTRUCTURE OVERVIEW

POWER GRID

Existing electricity facilities

(~3 MW) enable Polyus to launch the construction at Sukhoi Log

To cover operational power needs (~229 MW) Polyus has already signed an agreement with Federal Grid Company (FGC) for technological connection of Sukhoi Log

to the existing power grid

To secure sufficient power supply, FGC will construct ~1,000 km

of 500kv grids from Ust-Ilimskaya HPP to Taksimo and upgrade substations

A gas-powered station may potentially be constructed in the area close to Sukhoi Log as part of development of Russian Railways network, which may further improve the reliability of the Sukhoi Log power supply

AIRPORT TRANSPORT

Polyus owns a 61% stake in a local airport, Bodaybo, ~145 km south-west of Sukhoi Log. However, the airport infrastruc- ture, including runway, is state-owned, due to legal limitations

Polyus is preparing a PFS on airport infrastructure improvement and a reconstruction of the runway, which is expected to be completed in 2020-2021

The upgrade will streamline access to Sukhoi Log for employees and time-critical cargoes

The national project "Comprehen- sive plan for the modernization and expansion of core infrastruc- ture" provides direct state funding for the upgrade of state-owned airport facilities in the amount of 4.35 billion rubles in 2022-2024

Irkutsk region

Chertovo

Koryto

SUKHOI LOG

Verninskoye

Kropotkin

145 km

Alluvials

Bodaybo

Novaya Chara

Taksimo

Polyus has completed the assessment of logistic requirements and expects to conduct surveying of bridge and road infrastructure required for construction and operation of Sukhoi Log as part of the Feasibility Study. This will help to better evaluate options of their upgrading

At the same time, Polyus is discussing with state and local authorities options for financing this infrastructure

Additionally, Polyus has launched an engineering study for storage expansion at Taksimo (to be completed in mid-2021), and also an engineering study of a local railway station expansion to be presented at the Russian Railways' Investment Committee expected in 2021

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SUKHOI LOG POWER SUPPLY CHAIN

POWER SUPPLY INFRASTRUCTURE REQUIREMENTS

			SUKHOI LOG
		Peleduy
		Vitim	Verninskoye
GENERATION		NPS-9	Kropotkin
	NPS-7
SCOPE
Ust-Ilimskaya Hydro Power Plant	Ust-Ilimskaya
CURRENT STATUS	Hydro Power Plant
		Mamakan
Constructed	Ust-Kut
			Novaya Chara
		Severobaykalsk	Taksimo

LOCAL GRID

AND CONNECTION

TO LONG-DISTANCE GRID

SCOPE

Vitim Substation and 5km of gridline from the substation to Sukhoi Log

FINANCING

LONG-DISTANCE GRID

SCOPE

Construction of ~1,000 km

of 500kv grids from Ust-Ilimskaya HPP to Taksimo and upgrade

of substations by FGC

FINANCING

Federal Grid Company (FGC)

CURRENT STATUS

FGC and Polyus signed binding "technological connection agreement"

The contractor for the engineering design is being selected, design to be completed by 2021 YE

Polyus

CURRENT STATUS

Sep 2020

Engineering contractor selected

Mid 2021

Engineering design is expected

2022-2023

Construction

33

UPDATE PROJECT TIMELINE

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

ENGINEERING

Initiation

Scoping study

Pre-feasibility

Feasibility study

Final investment decision

Investment decision

Project Design Documentation

Regulatory procedures, GGE

Plant construction permit

Detailed Design

PROCUREMENT

Mining equipment for start of pre-production

Tenders and Contract Awards, Fabrication, Delivery to Site and Assembly

Process plant equipment

Tenders and Contract Awards, Fabrication, Delivery to Site

CONSTRUCTION & PRE-PRODUCTION

Open Pit

Pre-production Mining

Process Plant and Infrastructure	Plant building construction, equipment installation

Tailings Storage Facility

COMMISSIONING

First gold poured

34

NEXT STEPS

FEASIBILITY & COMPLEX	PILOT
ENGINEERING STUDIES, ESIA	TESTING

PILOT PLANT 3D DESIGN

With the PFS being completed, Polyus is instantly moving to the Feasibility Study stage to proceed with more accurate technical and financial analysis of the selected development option for Sukhoi Log

The results of the FS will serve as the basis for the final investment decision on the project

Polyus is also currently carrying out an Environmental and Social Impact Assessment (ESIA) to evaluate the likely impacts prior to decision-making

Polyus has already started complex engineering studies, which outcomes will be incorporated in ESIA and FS

Polyus has fully replicated the flowsheet developed in the PFS at its R&D center in Krasnoyarsk and is currently pilot testing the processing technology on ore samples from Sukhoi Log (2 ore samples of 5t each)

Pilot tests are aimed at:

• Specifying the operational parameters for gravity separation and flotation circuits
• Optimizing design parameters
• Generating various products for vendor testing and
• Continuous testing of the CIL circuit

The pilot tests are expected to last till December 2020, the results are expected in 2021

THICKENING

AND FILTRATION

SCREENINGFLOTATION

1ST STAGE OF GRINDING

FLASH FLOTATION

REGRINDING

GRAVITY

2ND STAGE OF GRINDING

GRAVITY TAILS

THICKENING

35