Russian gold miner Polymetal to raise "green" project financing for four projects

Russian gold miner Polymetal to raise
Vitali Nesis' Russian gold miner Polymetal to raise "green" project financing for four projects.
By bne IntelliNews October 25, 2019

Russian gold miner Polymetal, one of Russia’s largest producers of gold and silver, is the latest to join the go-green wave that is building amongst Russia’s leading corporates. The company has opened talks with leading European banks to raise “green” financing for its projects. CEO Vitaly Nesis expects a deal to be closed in the second half of 2020, Reuters reported on October 25.

As bne IntelliNews reported in a cover story “Russian companies scramble to improve their ESG scores or face losing investors” in July, Russian companies are starting to lose portfolio investors if their ESG (environment, social and corporate governance) scores are too low and are scrambling to address their environmental problems.

In the latest example, leading power company Enel sold off its main coal-fired power station in October as it is dramatically reprofiling its generation assets and dumping the biggest carbon producers in favour of renewables.

Polymetal is hoping to raise green financing for four projects including the construction of a solar power plant and the reduction of water consumption at its deposits which need total investment of $60mn-$70mn within the next three years, Reuters reports.

“We believe that we are ready for more difficult products linked to sustainability,” Nesis said. “But unlike the classic sustainability-linked loans, this product is non-standard. We are among the first in our industry to think about this kind of financing, so it won’t be fast.”

Another project is the development of the Tomtor rare earth metal deposits that produce metals that go into the production of electric cars. Tomtor is owned by Vitaly Nesis’s brother and Russian businessman Alexander Nesis. Polymetal may invest about $20mn in exchange for a stake of less than 10% in Tomtor.