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"Kekura and Klen will be subject to zero or reduced income tax, precious metals royalties, land rental, land tax, and property tax over the first five to ten years of operations. They will also pay a unified social tax on payroll of 7.6% versus the statutory rate of 30%"

RNS Number : 3200E

Highland Gold Mining Limited

03 July 2019

HIGHLAND GOLD MINING LIMITED

03 July 2019

Kekura and Klen Admitted to Special Economic Zone

Highland Gold Mining Limited ("Highland Gold" or the "Company", AIM: HGM) today signed an agreement with Russia's Far East Development Corporation officially confirming residency in the Chukotka Advanced Special Economic Zone (ASEZ) for the Company's Kekura and Klen projects.

The Russian government's ASEZ programme is designed to spur new investments in the country's Far East Federal District and covers 19 geographic areas. The Chukotka ASEZ, in which Kekura, Klen, and the Company's Valunisty mine are located, was created earlier this year via the expansion of an existing zone.

As residents in the ASEZ, Kekura and Klen will be subject to zero or reduced income tax, precious metals royalties, land rental, land tax, and property tax over the first five to ten years of operations. They will also pay a unified social tax on payroll of 7.6% versus the statutory rate of 30%, and be entitled to an expedited refund process for value added tax expenses.

Kekura is Highland Gold's premier development project, with construction currently in progress, stripping and preliminary ore mining set to start later this year, and commercial production expected to begin in 2023. The Kekura project has audited JORC-compliant gold reserves of 2.0 million ounces at a grade of 7.0 g/t, and is designed to produce an initial 172,000 ounces of gold a year with forecasted total cash costs (TCC) of US$511 per ounce. The Company estimates that residency in the Chukotka ASEZ adds approximately US$100 million to the project's net present value (NPV).

Chief Executive Office Denis Alexandrov said: "Highland Gold would like to put on record its thanks to the Russian federal government and the Chukotka regional administration for their support of Kekura and Klen, which will bring substantial jobs and tax revenue to Chukotka over the full life of the projects. In addition to the ASEZ, the government is building a power line to Kekura as well as a year-round road not far from this remote site. This level of support confirms Chukotka's beneficial investment climate and Kekura's importance to the development of the region."

Dark_Knight2020

"Does anyone think that the board rules were breached by the mafia ? "

To be honest not in my opinion. I'm not a lawyer though.

"The Company affirms its guidance for total production of 290,000-300,000 oz of gold and gold equivalent in 2020."

HIGHLIGHTS

· Highland Gold's four operating mines produced a total of 61,357 oz of gold and gold equivalent in Q2 2020, in-line with production forecasts for the quarter (Q2 2019: 70,293 oz).

· For the first half of the year ("H1 2020"), total production was 125,347 oz of gold and gold equivalent, also in-line with internal production targets (H1 2019: 142,254 oz).

· The Company affirms its guidance for total production of 290,000-300,000 oz of gold and gold equivalent in 2020.

· Mnogovershinnoye (MNV) and Valunisty increased waste stripping by 101% and 35%, respectively, in H1 2020 in preparation to access higher-grade open pit reserves in the second half of the year.

· Equipment is on-site and buildings are currently being erected for the processing plant expansions at Novoshirokinskoye (Novo) and Belaya Gora, with both projects on track for completion this year.

· Kekura construction also continues as scheduled, with several second phase facilities in progress including the main processing plant and the camp expansion.

· Construction has begun on the Baley ZIF-1 Tailings heap leach project, which is expected to produce first gold in 2022 with average annual output of 15,000 oz over 11 years.

· Production, sales and supply chain were not materially affected by the COVID-19 pandemic, as outlined in the pandemic response statement issued by the Company on 29 June 2020.

· The average realised gold price was US$ 1,723 per ounce in the second quarter and US$ 1,655 in the first half of the year.

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Eventually the share price is rising too. GLA

Gold just hit $1810.

What do you think about the gold price now?

One of the few gold miners that pay a decent dividend too.

HGM has a low AISC per ounce. At current price they should be making a profit of close to a $1000/oz.
They should make a profit of $250millions this year according to my calculations. DYOR

The seller David Davidovich has become a multi billionaire and has far bigger investments than this. His investment here is probably not significant for him anymore .

All that glitters IS gold, when it comes to Russian mining.

http://www.miningworld.ru/Articles/gold-mining-in-russia-2020-update

Moscow. July 7th. INTERFAX.RU - Partner of Roman Abramovich David Davidovich in early July sold a 0.5% stake in Highland Gold Mining (HGM).

As follows from the message of the company, Davidovich's share in Highland Gold was reduced to 2.68%.

The market price of 0.5% HGM, based on the latest bid closing price in London, is £ 4.1 million (about $ 5.2 million).

On the eve of the transaction, the total share of the main group of Highland Gold shareholders - Roman Abramovich, Evgeny Shvidler and their friendly structures - amounted to 43.77%. One cannot conclude from the message whether Davidovich sold 0.5% of the shares to one of the partners or to a third party. If the buyer was a third party, the share of the main group of shareholders could be reduced to 43.27%.

https://www.interfax.ru/business/716171

Highland Gold is a company registered in the UK and mining gold in Russia. The main projects are located in the Khabarovsk Territory and Transbaikalia, in Chukotka, as well as in Kyrgyzstan.

Looks like Gold is going to break through the $$1800/oz psychological barrier this week.

Some other UK listed gold miners haven't done well either if you consider the rise of gold price. I think they will rise eventually if the gold price stays at these levels.

Still cheap imo.

$1793/oz and likely to rise further. could go above $2000/oz by the end of this year imo.

He also seem to have an interest in TransContainer, a giant freight transport company based in Russia. His holding in HGM probably has not much signifcance for him anymore. He'll probably sell rest of his shares and hopefully this will fly once he has cleared.

New gold rush is on as investors and central banks hoover

https://www.telegraph.co.uk/business/2020/07/06/new-gold-rush-investors-central-banks-hoover-bullion/