Board decisions

The Board of Directors of Russia's leading gold producer OJSC Polyus Gold (RTS, MICEX and LSE - PLZL) has reviewed the development project of the Natalka deposit in the Magadan Region and approved the launch of construction of a mining complex at the deposit.

The development project envisages the following stages:

- Completion of the 1st stage construction works in the fourth quarter of 2013;

- Reaching full processing capacity of 10 million tonnes of ore per year in 2014;

- Projected gold production of 18.2 tonnes in 2014;

- Gold recovery at 85.2%; and

- 1st stage investments (2010-2013) at RUR 31.5 billion.

Implementation of pre-mining grade control drilling accompanied by mining plan optimization procedures has led to an increase in the average grade of ore supplied to the plant to 2.1 grams per tonne at a 0.8 grams per tonne cut-off grade. An independent audit of the mining plan has been carried out, covering both the audit of the average grade and volumes of ore to be processed.

Under the approved development project, the launch of the mining complex at the Natalka deposit is expected to be completed in three stages:

- 1 stage: 10 million tonnes processing capacity per year - in 2014;

- 2 stage: 20 million tonnes processing capacity per year - in 2016;

- 3 stage: 40 million tonnes processing capacity per year - in 2020.

At a processing capacity of 40 MTPA, gold production will amount to approximately 50 tonnes per year.

The decision on whether to launch each subsequent stage will be subject to availability of power supplies at reasonable tariffs, as well as macroeconomic factors including the rate of inflation and the price of gold.

The Board of Directors has allotted RUR 1 billion for pre-mining grade control drilling at the Natalka deposit in 2010-2012.

"In 2013, we are launching a gold mill at the Natalka deposit, which will, upon completion, be the largest mill in Russia and one of the largest in the world", said Mikhail Prokhorov, CEO of Polyus Gold. "The successful realization of the project will lead to a 25% increase in gold production in Russia and be another critical step in reaching our strategic target - to become one of the largest gold producers in the world", Prokhorov added. "Moreover, the realization of this project is a substantial contribution to the development of the Far East Federal District. The launch of the plant will create several thousands of new jobs and increase tax proceeds to the budget of the Magadan Region", Prohorov added.

The audit of the development project for the Natalka deposit was carried out by leading international engineering companies: Micon International Co Limited; SRK Consulting; Hatch.

OJSC Polyus Gold is Russia's leading gold producer and one of the world's largest gold mining companies in terms of market capitalization, mineral reserves base and output. The Company's asset portfolio includes hard-rock and alluvial deposits in the Krasnoyarsk, Irkutsk, Magadan and Amur Regions, the Republic of Sakha (Yakutia). The company produced 1.3 m oz of gold in 2009.

For further information please contact: For investors:Alexey V. Chernushkin, Director, CM and IREvguenia V.Buydina, IR manager+7 (495) 641-3377+7 (495) 785-4031 [email protected]

For media:Anton A. Arens, PR Director+7 (495) 641-3365+7 (495) 544-5496[email protected]