Polymetal wins the auction for exploration and mining license on Krasin prospective area in the Magadan territory

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Saint Petersburg, Russia, March 09, 2010 – JSC “Polymetal” (LSE, MICEX, RTS: PMTL) (“Polymetal” or the “Company”), through its subsidiary, won the auction for exploration and mining license on the Krasin deposit located in the Magadan Territory. The Krasin license covers the area of 18 km² and is located in the Omsukchan district, 31 km from Polymetal’s recently expanded Dukat processing plant and 6 km from the all-year dirt road connecting Dukat and Lunnoe mines.

The auction took place in Magadan on March 01, 2010. Polymetal’s winning bid amounted to 14.3m roubles (US$479 thousand). The license will expire 25 years after its issuance in 2010. The licensing agreement stipulates that Polymetal will have to undertake no less than 10,500 m³ trenching and 5,000 meters drilling during the four years after the license is issued.

According to the Federal Subsoil Agency (Rosnedra), Krasin resources amount to 111.3 tons (c. 3.4Moz) of silver according to the Russian C2 category and 420 tons (c. 13.5Moz) of silver according to the Russian P1 and P2 categories. Exploration was conducted on the property during 1974-1982 and 1990-1993 with 4700 meters drilled (31 drill holes) and 4601 meters of trenches completed.

The deposit is located in a breccia zone and represents low-sulphidation gold-silver mineralization. The main ore body has true width of 2.4-3.6 meters over the strike length of 400 meters and 140 meters down dip. The deposit’s average silver and gold grades are 366 g/t and 0.9 g/t accordingly. The strike extensions of the main ore body and potential ore bodies without surface outcrop in the north of the prospective area have strong exploration potential.

Polymetal intends to fast-track detailed exploration at the property with the objective to introduce ore from the deposit to Dukat processing plant by 2013.

In the Omsukchan region of the Magadan Territory, Polymetal currently operates Dukat, Lunnoye and Arylakh (Lunnoye satellite) silver/gold mines. The Company targets Goltsovoye mine to start producing in the third quarter of 2010, with the ore transported to Dukat plant for processing.

ABOUT POLYMETAL

Polymetal is a Russian gold and silver miner with operations and development projects in Russia and Kazakhstan. The Company produced 0.6 million of gold equivalent ounces in 2009 and is targeting to double its total production by 2012 mostly as a result of commissioning of the new projects, all of which are now under construction. A key element of Polymetal’s strategy is creation of processing hubs with the goal to ensure the most efficient and responsible utilization of financial and human capital by treating ores and concentrates from various sources at centralized locations.

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