The mineralized bodies at Varvarinskoye are classic gold-copper skarn types that are primarily contained within the eastern side of the local fault and are associated with the border between geological formations. Copper-gold porphyry is overlaid with quartz-sulphide gold veins and scarn to produce very complex and geometrically complicated zones of economic mineralisation. Mineralisation is discontinuous over a strike length of 4 km and is divided into five zones.

The main primary copper mineral is chalcopyrite with some bornite. The gold is mostly in free form and associated with pyrites and other sulphides. A hallow oxidation zone occurs within 10 to 50 m below the surface. In this part of the Varvara deposit, copper is mostly represented by oxide minerals not amenable to conventional flotation.

Based on mineralogy and metallurgical characteristics, all mineralisation is divided into four types based on the degree of oxidation and copper grade:

1.primary gold (copper less than 0.2 per cent.);
2.primary copper (with gold present);
3.oxide gold (copper less than 0.1 per cent.);
4.oxide copper (with gold present).

Types 1 and 3 are processed through the leaching circuit and are known as leach ore. Type 2 is processed through the flotation circuit and is known as float ore. Type 4 is currently stockpiled separately and not processed.

Komarovskoye is a low-sulphide quartz gold deposit located along the contact of the granite intrusion. Mineralisation occurs within the fault zone and consists of steeply dipping quartz-carbonate-micaceous metasomatites hosted by schists. The overall strike length of Komarovskoye is approximately 6,800m with individual mineralised zones generally 500-600m in length, 4-6m in width. Oxidation depth is limited to 30-50m below surface.

The Varvara deposit is elongated in a northeastern direction and has a length of up to 4.5 m and a width of 1.2 km.

Development of reserves is carried out by "Ugo-Zapadny", "Severo-Vostochny-3" and "Prirechny" open pits.

Excavation of rock is carried out in 5-10 m benches. Draglines and shovels are utilized for extraction-and-loading operations in pit and wheel loaders in stockpiles. Ore and waste haulage is carried out via Cat777 and KOMATSU HD 785 haulage trucks.

Drilling and blasting operations are carried out by contractor.

Separate storage of ores is carried out at the Varvara, depending on the grades of ore and the content of the useful component.

Varvara’s processing facilities are located at a single site. Varvara has two distinct ore types based on their copper content. Run-of-mine ore is crushed in batches in a single jaw crusher, with separate crushed ore storage for leach and float material. Gold doré and gold-copper concentrate are produced from the two circuits of the single processing plant.

The float ore circuit comprises two-stage milling (SAG mill and ball mill) and conventional flotation. Concentrate is thickened, filtered, packed in big bags and trucked to a railway spur for transport to the off-taker.

The leach ore circuit comprises two-stage milling, conventional CIP leaching, carbon desorption, carbon regeneration, electrolysis and smelting. The ultimate product is gold dore.

Ore containing more than 0.2% copper (float material) goes to a 1,050 ktpa flotation circuit with the final product being a gold-copper concentrate which is sold to an off-taker.

Ore containing le ........