In the beginning of July Polymetal completed the risks insurance process of the controlled mining subsidiaries.

In the frames of risk-management program in February, 2005 the risks insurance agreements of Magadan Silver («Dukat» deposit, Magadan Region) and Silver of Territory («Lunnoe» deposit, Magadan Region) were concluded.

The program, connected with specific risks reinsurance of material damage, risks related to operational breaks caused by physical damage, and also equipment and mechanisms of the mines breakdown, was worked out and offered by one of the world leading independent insurance brokers AON (UK).

The reinsurance program of similar risks of Northern Urals Gold («Vorontsovskoe» deposit, Sverdlovskiy Region) and Okhotsk mining-and geological company («Khakandjinskoye» deposit, Khabarovsk Region) was carried out with the help of the world leading insurance advisor – Marsh (UK). Insurance policies for the mentioned companies were signed in the end of June, 2005.

Polymetal pays close attention to the risks level fall, connected with operational activities. The risks management program also includes identification of the potentially vulnerable things in the production circuit, comprehensive approach to the risks reduction through the study of engineering decisions.

To avoid possible losses, connected with breakdown, damage and idle time of the equipment, fire at the working places and other risk factors, typical for this industry, branch mining companied signed the insurance agreements. The property loss risks and lay-off risks are liable to insurance. Limits of liability for all risks according to the insurance agreements amount to $US 50 mln. for each mine.

The data of the agreement provide for total risks reinsurance at foreign underwriters through one of the leading world insurance brokers AON, which undertakes obligations regarding insurance risks distribution at the leading western insurance companies. To provide estimations of the assets cost of the controlled mines Polymetal recruits independent high-quality western claim adjuster Appraisal & Valuation Consultants Ltd (UK).

«Signing of the agreements will let us minimize general industrial and branch risks. The participation in insurance programs of the leading foreign reinsurance companies and underwriters is an important advantage of the company for obtaining international financing on better terms», - said Sergey Cherkashin, Polymetal CFO.

JSC «MNPO «Polymetal» (www.polymetal.ru) was founded in 1998. Now JSC «MNPO «Polymetal» includes the management company JSC «Polymetal Management», engineering close corporation «Polymetal Engineering», 4 mining and 7 geological surveys in the Republic of Buryatia, Khabarovsk Territory, Sakhalin, Irkutsk, Chita and Magadan. JSC «MNPO «Polymetal» owns 15 licenses for precious metals deposits and exploration areas, takes the first place regarding silver output in Russia, ranks among the top ten gold mining companies, and also is one of the ten world leading silver producers. Totally the general precious metals reserves (С1+С2) in the holding company amount to 20 500t. of silver and 170t. of gold.