Russian junior gold miner GV Gold announced a record production of 304.4 koz in 2018, beating out management forecasts. A relatively young miner, the company has more than doubled its production in the last two years, the company said in a statement released on January 28.

“GV Gold’s performance in 2018 has positioned the company as one of the most dynamic players in the sector. We are confidently moving toward our goal of becoming one of Russia’s top five gold producers. We have successfully completed a large-scale investment cycle, a key result of, which was the launch of two strategic projects. By ramping up production capacities, the company has reached an entirely new level, practically doubling gold production from 164 koz in 2016 to 304 koz in 2018,” GV Gold CEO German Pikhoya said.

GV Gold has launched two new projects in the last two years at a time when the Central Bank of Russia (CBR) is snapping up nearly all the gold produced in Russia. Russia has been actively building up gold as a share of its gross international reserves (GIR) since 2007.

The company’s exploration programme has identified new deposits and it expects to keep growing at a similar speed for the foreseeable future.

Gold production last year beat the management’s own guidance of producing 280-300 koz of gold in 2018.

Production sites launched in 2017 have delivered strong operating results: the Taryn mine increased output by 62% year-on-year and production at the Ugakhan mine was up by 284% year-on-year. The Bolshoy Kuranakh placer deposit set a new record with 17.4 koz of gold production, the company reports.

“Production at the Vysochaishy mine was stable year-on-year at 130.7 koz of gold, with significantly higher volumes of processing and extraction, which fully mitigated the decline in average grade and enabled the company to maintain output on the same level as last year,” GV Gold said in a press release.

The Ugakhan and Taryn processing plants reached and even exceeded nameplate capacity, which drove the 40% year-on-year increase in ore processing to 8,210 kt for FY 2018.

“The main drivers of growth during the period were the Taryn and Ugakhan processing plants, which delivered exceptional results. At the same time, work was also undertaken in other areas. In the past year we carried out the most expansive geological exploration programme in the company’s history. As a result of this work, we expect to extend the lifespan of our flagship Vysochaishy mine, as well as the Marakan mine, through 2024. We plan to publish the results in the first half of 2019,” Pikhoya said.

The company has also acquired a licence for the development of the promising Svetlovsky ore field in the eastern part of the Bodaibinsk ore field, a project which GV Goal says it is considering for the development of its Irkutsk business unit.

“Successful completion of geological exploration laid the foundation for sustainable future growth at all of the company’s business units. The company spent an estimated $27mn on geological exploration in 2018,” the company said.

Revenue from gold sales is estimated at $357mn, a 32% year-on-year increase.

Net debt at the end of 2018 is estimated at $72mn, which is less than half of the $176mn in net debt that the company reported at the end of 2017.

In 2018 the company adopted a new dividend policy that aims to pay out at least 30% of Ebitda based on IFRS accounts, and the company declared its first dividends based on its results in the first nine months of last year.

The company said that its two major investment projects are up and running and it now intends to grow production organically based on the existing assets this year.

The management guided for a more modest production gain this year of 305-325 koz of gold.