3 July, 2006 - OJSC Polyus Gold today announced that the company’s Board of Directors gave its approval for the Blagodatnoye deposit development project. The meeting of the Board took place on 27 June, 2006.

The project to develop the company’s Blagodatnoye deposit in Krasnoyarsk region of Russia will result in construction of the mill of annual capacity of 6 mln. tonnes of ore. As it’s anticipated that the mill will be launched in 2010; the mine life of the deposit will last till 2028. The annual gold production at the mill is estimated at 12 tonnes (385 k oz). The project will require up to $ 328 mln. of investments (including VAT).

Commenting on the announcement, CEO of Polyus Gold Evgueni Ivanov said that “approval of the Blagodatnoye development project is a significant step forward for Polyus Gold. At Blagodatnoye, which reserves had been listed with the state last year, we are planning to build one of the largest gold mills in Russia and thus substantially raise our gold output in the region”.

The Board of Directors also had a discussion on the group’s strategic plan for 2006-2015, which is planned to be finalized at its next meeting.

The Board also set a date for the Extraordinary General shareholders meeting of the OJSC Polyus Gold on September 11, 2006, which is to be carried out in the form of absentee ballot voting. Polyus Gold shareholders, which are listed in the register on 27 July, 2006 will have the right to vote.

The agenda of the EGM will include remuneration of the independent directors of Polyus Gold as well the Board members’ liability insurance.

The Board of Directors also discussed possible acquisitions of gold mining assets in Russia and abroad.