Petropavlovsk reinstates dividend following 21% increase in 2009 gold production

In a production update ahead of its annual results, Petropavlovsk (LSE: POG) said it increased total attributable gold production by 21% in 2009. The company’s average gold sales price was also substantially higher, with a 15% increase to US$975 per ounce. The precious metals miner now intends to resume its dividend, with a £0.07 per share payment scheduled for March 2010.

During the twelve months ended 31 December 2009, the FTSE250 constituent produced 486,800oz gold, which is at the upper-end of guidance. Looking ahead, the Russian operating miner expects a further production increase in 2010, with attributable gold between 670,000oz and 760,000oz.

"I am pleased that we have delivered a sound 21% increase in gold production in 2009 and that costs are in line with our forecasts”, Petropavlovsk chairman Peter Hambro said, “Production in 2010 is likely to increase as the year progresses due to the significant volume of stripping scheduled at Pioneer in the first quarter which will  produce high grade material for the mill and also the new production capacity coming on stream during the year."

Petropavlovsk said its project development will continue in 2010 with an accelerated capital expenditure commitment to deliver another double digit percentage production increase.

Commissioning of the Pioneer mine’s third milling line has been brought forward to the first half of 2010, providing additional capacity of 135,000 tonnes of ore per month. The Malomir project is undergoing construction and development work, and its Quarzitovoye deposit is scheduled for first production in August 2010. The Albyn infrastructure programme has commenced and productionis is currently scheduled for the end of 2011.  http://www.proactiveinvestors.co.uk/companies/news/12475/petropavlovsk-reinstates-dividend-following-21-increase-in-2009-gold-production-12475.html