Based on the materials from the company’s official web-site.

On September 21st the companies’ CEOs signed an agreement establishing the formal terms governing their cooperation in the Strategic Alliance. Polymetal and AngloGold Ashanti will participate in the Strategic Alliance though a Joint Venture company (JV), each party will hold 50% in the JV. The agreement provides for joint identification, acquisition and development of attractive gold mining projects in Russia.

In terms of the Strategic Alliance, it has been agreed that the JV’s interests in Russia will be divided into three broad regions. Polymetal and AngloGold Ashanti agree that the companies will jointly pursue the prospective exploration and development of gold opportunities in the Russian Federation within the entire Siberia Federal District and the Far East Federal District of Russia and including, the regions of Yamal Nenets, Khanty Mansi, Tyumen and Kurgan but excluding, certain areas (Magadan, Sverdlovsk, Kamchatka, Irkutsk Regions, Khabarovsk, Chukotka and Koryakiya Territories), as Exclusive Areas where the companies will only pursue gold mining opportunities through the Strategic Alliance. In other areas either AngloGold Ashanti or Polymetal may pursue a gold mining opportunity solely and independently, but not together with a third party as part of a consortium, unless the Strategic Alliance elects not to pursue such opportunity.

It is proposed that the Strategic Alliance will be equally held by AngloGold Ashanti and Polymetal and will initially hold two assets to be provided by AngloGold Ashanti and two greenfield exploration projects to be provided by Polymetal. Polymetal CJSC Eniseiskaya mining and geological company (EMGC) holds the license for the Aprelkovsko-Peshkovski deposit located in the Chita Region, and Imitzoloto holds the license for the Anenskoye deposit located in the Krasnoyarsk Territory. AngloGold Ashanti will contribute Amikan and Artel Staratelei Angarskaya Proizvodstvennaya Kompania (AS APK) to the Strategic Alliance. Amikan holds the comprehensive license in respect of the Veduga deposit and an exploration license surrounding Veduga, whilst AS APK holds a comprehensive license in respect of the Bogunay deposit. Both Veduga and Bogunay are located in the Krasnoyarsk Territory.

Consequently, the initial focus of the Strategic Alliance will be Veduga, Anenskoye, Bogunay and Aprelkovsko-Peshkovski, whilst other opportunities are pursued as and when these become available.

The formation of the Strategic Alliance is subject to a number of conditions precedent including appropriate corporate and regulatory approvals, confirmatory due diligence, no material adverse change and completion of binding documentation. Completion is expected no later than 31 January 2007.

By working together in the strategic alliance, Polymetal and AngloGold Ashanti will look to maximize the benefits of their respective competencies and strengths. As Russia’s leading precious metals mining company, Polymetal has necessary in-country knowledge and skills, successful experience in development large mining projects in Russia. AngloGold Ashanti as one of the largest international gold mining companies complements this by applying global exploration and project development expertise in all the continents and world-class technologies.

Commenting on the announcement, Vitaly Nesis, Polymetal CEO, said: "Strategic Alliance with AngloGold Ashanti provides new development opportunities for both companies. We strongly believe that joint operation will expand the framework of our activities and accelerate the development of large-scale gold mining projects in Russia".