Lou Naumovski
The new regulations are expected to increase the development of Russia’s mineral resources, Russia Beyond the Headlines reports.
Current law allows the Russian government to deny a foreign company the right to develop a deposit if there is a “threat to national defense and security.” The Natural Resources Ministry may exempt gold, diamond and platinum miners from this law, though, in order to boost the industries.
The restrictive legislation has been protested in the past, as well, specifically by Polymetal CEO Vitaly Nesis in 2010. Nesis sent a letter to the government suggesting ways to remedy the situation, including converting exploration licenses to mining ones and raising the bar for strategic mineral deposits from 50 to 250 tons, according to Russia Beyond the Headlines.
The Ministry of Natural Resources has submitted relevant legislation to the government, much to the excitement of foreign mining companies. A spokesman for Highland Gold’s Russian office said this will help foster development in the country’s mining industry, leading to the discovery of new sites, investments and new jobs.
Kinross’ Lou Naumovski said that other practices grant subsoil users the right to use mineral deposits they discover at their sole discretion. Introducing such measures should attract investors and spur foreign geological exploration, Russia Beyond the Headlines reports.
Oleg Petropavlovsky, an analyst with BCS, said that the legislation will not affect big global gold mining enterprises that can always exploit existing loopholes and register a deposit to a Russia-based subsidiary.