Olcon obtains license for exploration and mining of Anomalny deposit in Murmansk Region

The Olenegorsk Mining and Concentration Works (“OAO Olcon”), part of the mining division of OAO Severstal, one of the world’s leading steel and mining companies, has obtained the right to use subsoil for the exploration and mining of iron ores in the Anomalny deposit in the Murmansk Region. The award of this license was the result of the winning bid at the auction held on April 7 2011 by the Murmansk Region’s Department for Subsoil Use.

The Anomalny deposit is located in the southwestern part of the Zaimandrovsky Iron Ore District between the Kirovogorskoye and October 15th Anniversary deposits already developed by OAO Olcon. It is comprised of the two ore zones, namely Northern and Southern.

Geological studies’ results have indicated that the prospects of the deposit are ultimately connected with the Southern Ore Zone. The inferred reserves’ estimate at the Southern Ore Zone comes up to 46,940 thousand tonnes.

With a view to transferring these reserves into commercial categories, in 2011 and 2012 OAO Olcon will carry out extensive geological explorations to specify parameters, re-estimate reserves and register these estimates with the State Reserves Register in compliance with standard procedure.

Alexander Popov, General Director of OAO Olcon, commented: “The growth in raw materials reserves from the new adjacent reserve will help Olcon to maintain consistent iron ore and concentrate production capacity over a long period of time, which is vital to both OAO Olcon and the wider Olenegorsk economy and community.”

In 2010, OAO Olcon obtained licenses for the right to use subsoil for the exploration and mining of iron ores in the Kurkenpakhk deposit and in the Eastern area of the South Kakhozersky deposit, and a separate license for the right to use subsoil for geological studies of the Lead Tundras area.

The Kirovogorskoye, October 15th Anniversary and Kurkenpakhk deposits are currently being mined with an open-pit method, whereas the Olenegorskoye deposit is being mined with a combined open-pit and underground method.