Moscow, December 21, 2006 – OJSC Polyus Gold, Russia’s leading gold producer, today announces that it has completed the consolidation of 100% shares of  OJSC South-Verkhoyansk Mining Company (“SVMC”) which is a holder of the license for Nezhdaninskoye gold deposit located in the Republic of Sakha (Yakutia).

The 100% consolidation of SVMC by Polyus Group (OJSC Polyus Gold and its subsidiaries) resulted from the acquisition of a 50% stake in SVMC from Interros Holding Company. The acquisition of the stake was approved by the Polyus Gold’s Board of Directors on its meeting held on November 7, 2006.

Nezhdaninskoye deposit is currently undergoing extensive exploration, especially in the central and northern areas. These exploration works are expected to provide substantial growth in gold reserves. The results of the exploration will become the basis for developing Nezhdaninskoye scoping study to be completed in 2007 by Russian “VNIPIPromtechnologii” engineering company which was chosen as a general contractor for the study.

Commenting on the event, Polyus Gold’s CEO Evgueni Ivanov said: “The consolidation of SVMC goes in line with Polyus Gold’s long-term strategy, aimed at increasing our mineral resources base and developing prospective gold deposits in the Russian Federation”. Mr. Ivanov also added that “Nezhdaninskoye deposit has strong geological potential and Polyus Gold has unique technologies applied which may provide positive results in developing the deposit and extracting gold out of its refractory ores”.

Note for editors

Polyus acquired first 50% of OJSC SVMC in September 2005, as part of a larger transaction to acquire mining assets located in Sakha Republic (Yakutia) from Alrosa Investment Group.

Nezhdaninskoye deposit is one of the largest gold deposit in Russia. According to Russian classification Nezhdaninskoye reserves amount to 220 tonnes (7.1 m oz) of B+C1 categories and its resources amount to 690 tonnes (22.2 m oz) of C2+P1 categories.

OJSC Polyus Gold is the leading gold producer in Russia. The group’s asset portfolio includes 20 hard rock gold deposits located in Krasnoyarsk, Irkutsk, Magadan, Yakutia and Amur regions of Russia. The company produced over 1 million ounces of gold in 2005.

For further information please contact

Denis Davydov
Head of Investor and Public Relations
Tel.:  +7 (495) 641 33 65
E-mail: pr@polyusgold.com