Krasny is Kopy Goldfields’ most advanced gold project to date and consists of three licenses – the Krasny bedrock license, the Krasny alluvial license and the neighboring Batiy bedrock license. Exploration activities have been performed at the site since 2010, when the project was acquired from the Russian state through a competitive public auction. Located in the vast expanse of the Patom Highland in the Bodaibo area of Irkutsk region of Russia and 75 km from the city of Bodaibo, Krasny sits on an area of 31 km². The area is known for its alluvial gold production with several placers (including three active) within, or neighboring, the license area. Kopy Goldfields’ Krasny license is valid until 2035 and provides rights for bedrock gold prospecting, exploration and production.

Most of Kopy Goldfield’s exploration efforts and funds was put into the Krasny project. An updated mineral resource report according to the JORC Code was finalized in 2018, showing a 32 per cent increase y-o-y of the gold resources at the Krasny deposit to 1,832 koz. Exploration at the site has almost been finalized and Kopy Goldfields and GV Gold are now evaluating alternatives for an exit. The 49 per cent stake of the project, held by Kopy Goldfields, had a book value of MSEK 105, as per December 31, 2019.


Acquired: 2010

Mineral reserves according to JORC: Probable: 257koz@1.09 g/t. Signed by Micon 2018

Mineral resources according to JORC:
Krasny: Indicated: 291 koz@1.2
0 g/t.
Inferred: 1 202 koz@2.02 g/t
Vostochny: Inferred 339koz@1.57 g/t.
Signed by Micon 2018

Mineral resources according to GKZ: C2: 314 koz, P1: 233 koz

Valid until: 2035

Ownership Kopy Goldfields AB: 49 %

License area: 31+86 sq km 

Kopy Goldfield’s Krasny license is valid for 25 years and provides rights for bedrock gold prospecting, exploration and production. In 2015, the joint company with GV Gold that holds the Krasny bedrock license, acquired a licence for alluvial mining which is located within the boundaries of the bedrock license. In 2017, the joint company was granted a bedrock exploration license, called “Batiy”, which borders the Krasny license on the Northwest.

The Krasny project is located in a gold rich lithological and stratigraphical area. It is characterized by intensive geochemical gold anomalies and rich alluvial gold deposits in the streams. The Krasny deposit is located within the Upper Riphean Vacha suite in the form of a single discontinuous-continuous mineralized zone, consisting of two saddle-shaped groups of vein-veinlet-disseminated quartz sulphide gold ore bodies (upper and lower), one ore body put upon another one. The mineralized zone is confined to the axial part of the main structure of the ore occurrence – the Rudnaya anticline. The anticline represents an oblique overfold of the southeast strike with the axial surface dipping at 70-85° northeast. The limbs are composed of bands of alternating sandstone and phyllites up to 60 m thick. The southern limb dips northeast at 85°, and the northern limb dips northeast as well at 45-75°. 

Within the Krasny deposit, the mineralized zone is traced in trenches and boreholes from the exploration line 8 (northwest) to the exploration line 67 (southeast) at 2,360 meters. It is discontinuous-continuous lens-shaped or lens-shaped band-like in plan and saddle-­shaped and lens shaped in section, with bends, bulges, splits and thinning out. The thickness is up to 20-80 meters at the flanks and up to 160-200 meters at the central part. The contours of the ore bodies have no clear boundaries and are defined on the basis of core and channel sampling results only. The oxidation zone is developed to the depth of 20-100 meters. The upper group of the ore bodies is about 1,200 meters long; the vertical span of the mineralization is 250 meters wide; the lower group of the ore bodies is 2,360 meters long, and the vertical span of the mineralization is 400 meters. The total span of the mineralization studied in boreholes is 590 meters (elevation 1,010-420 meters) the length along the strike is 2,360 meters. The intensity of mineralization correlates directly with the degree of occurrence of quartz-sulphide veinleting and imposition of other hydrothermal-metasomatic alterations. 

The mineralized zone within the Vostochny gold occurrence is traced in trenches and boreholes for 2,340 meters from the exploration line 146 in the west to the exploration line 205 in the east. The gold mineralization is located within the northern and southern limbs of the upper structure and within the hinge zone of the lower structure. Within the upper structure, the ore bodies have a thickness of 5-8 meters. The northern limb of the upper structure is dipping north-east at 45 degrees. The southern limb dips sub vertically. It is possible, that the hinge zone of the upper ore body has been fully eroded. The vertical span of the upper mineralization is 130 meters. The lower structure has been traced between the drill profiles 150 and 158. The lower mineralization is located at the saddle zone of the anticline. It dips to the north-east at 61-65 degrees. It has been traced for 100 meters down the dip. Both the upper and the lower mineralizations are open along the strike and down the dip. Vostochny and Krasny represent the same type of gold mineralizations and may be processed together. 

Meanwhile, the quartz content in the mineralized zone does not exceed 2-3 per cent. The morphological type of mineralization is mineralized zones-beds with veinlet-disseminated quartz-sulphide mineralization with the total sulphide quantity up to 3-3.5 per cent. Hosting ore bodies are presented by alternation of carboniferous quartz-sericite schists, siltstone and sandstone of the Vacha suite. The main mineral type of ore is quartz low-sulphide (pyrite). 

In the summer of 2014, the Company entered into a joint venture agreement with the Russian gold producer GV Gold over the Krasny project. Under the agreement, GV Gold earned a 51 per cent interest in the Krasny Project by initially paying the Kopy Goldfields MUSD 1 in cash and by financing an exploration program followed by a resource report in accordance with both the Russian GKZ classification and the international JORC standard. The budget for the total exploration program was MUSD 6 and was financed by GV Gold in full. The initial exploration program was developed in two stages and targeted the Upper Mineralization of the Krasny deposit closest to the surface and limited to the depth of 200 meters. In April 2016, following a formal approval of a mineral reserve report for the Krasny deposit by the Russian GKZ authorities in Irkutsk, Kopy Goldfields received a further MUSD 2 in a conditional consideration cash payment from GV Gold. 

Stage 1 – exploration to confirm existing model

During the first stage, exploration activities were aimed at confirming the existing model of the Krasny Central Upper mineralization to the depth of approximately 200 meters. The total budget for Stage 1 was estimated at MUSD 3, which was paid by GV Gold upon the signing of the joint venture contract. Exploration drilling started in July 2014 and was successfully completed on schedule by the end of November the same year. In total, 51 drill holes were completed, amounting to 7,916 meters of core drilling, while 1,712 meters of exploration trenches were also developed. In addition, three core holes covering a total of 582 meters were completed with the aim of collecting rock to run metallurgical processing tests. 

Stage 2 – aimed at planning gold production

Following the successful completion of Stage 1, GV Gold contributed the next MUSD 3 for Stage 2 in March 2015 into the joint venture. During spring, a preliminary production model was drawn up based on available data, in order to find the most optimal production scenario. Based on this, the Stage 2 exploration program was revised according to the updated scenario. The main objective of this stage was to collect information, as well as to plan for gold production on the Krasny license. The stage 2 drilling was commenced in June 2015 and finalized in September the same year. 

Overall, 49 drill holes were completed, totalling 7,551 meters of core drilling. The drilling results confirmed and developed the geological model for Krasny deposit. Following completion of the Stage 2 exploration activities, an additional expansion drilling program was initiated in December 2015 with the target of adding extra resources along the strike, but also filling in some blind spots between the drilling profiles left after the previous drilling. This program was finalized in February 2016 and included 16 drill holes and a total of 3,504 meters of core drilling. In December 2015, the technological mapping of the Upper mineralization within Krasny was initiated with the target to clarify the volume of the oxidized and primary ores to use as basis for modelling a production schedule and forecasting economic results. The final results from the assay testing were delivered in March 2016, confirming expectations of content and grade in the Upper mineralization. The Lower Mineralization was also tested, showing grades above 2 g/ ton and indicating an extra 20-23 tons of minable gold at the deposit, in addition to the 9 tons from the Upper Mineralization previously mapped out. 

Stage 3 – satellite gold mineralization discovered

The Stage 3 program was started in April 2016 and completed in February 2017. The program was partially financed by remaining funds from Stage 1 and 2, but also by a joint investment from Kopy Goldfields and GV Gold of MUSD 2, split in accordance with the ownership structure. The exploration program included a total of 100 core holes drilled, accounting for 19,622 meters of core drilling. In addition, 1,965 meters of trench sampling was performed and 21,822 fire assay tests for gold received. Most of the drilling was focused on the Central part of the Krasny deposit and within the Upper structure, with the target to upgrade the quality of the gold resources from Inferred to Indicated. The exploration results also confirmed the modelling of the Lower structure mineralization, with new high-grade intervals being discovered. The drilling results confirmed that the Lower mineralization’s extend further along the strike both on the Western and the Eastern flanks outside both the initial model of 2012 and the reported JORC resources in 2016. On the western extension it also comes closer to the surface. The mineralization is still open to depth on most of the drill profiles. 

During 2016, a satellite gold mineralization within the Vostochny structure was confirmed, which is located within 3-4 km from the Krasny Central. This mineralization is within the borders of the same Krasny license and makes part of the bigger Krasny project. 

Stage 4 – all targets achieved

The exploration program Stage 4 for Krasny was commenced in March 2017 and completed in December the same year, pursuing several targets:

• Infill Exploration drilling on the Lower Structure to convert part of Inferred resources of the Lower structure into Indicated category, to proceed with Feasibility Studies for the Lower structure; 

• Prospecting of both the Upper and the Lower structures within Krasny, based on strong evidences for further increase of gold resources along the strike of mineralization;

• Exploration of the Vostochny mineralization along the strike as well as infill drilling;

• Prospecting within other parts of the Krasny license area with target to identify additional “Vostochny” type gold mineralizations.

During 2017, 79 core holes were drilled, totalling 19,569 meters. In addition to drilling, all trench sampling activities were finalized in October 2017. In total, 3,110 meters of trenches were developed and logged, of which 1,425 meters were sampled and assay tested. All targets of the exploration program 2017 were achieved. Kopy Goldfields was the operator of the exploration program for the fourth year in a row since the start of the joint venture operations in 2014. The budget for the 2017 exploration program was planned at MUSD 4.4 and the program was partially financed by a positive cash balance left after Stage 3 and partially by new investments by Kopy Goldfields and GV Gold to the amount of MUSD 2.1. 

The most significant outcome of the drilling activities during 2017 was the discovery of the Lower structure at Vostochny mineralization. Based on positive exploration results from 2017, the new 2018 exploration program on Krasny and Vostochny was commenced in January 2018. Exploration activities on Krasny during 2018 included 11,638 meters of core drilling, primarily within the Krasny and Vostochny structures and within the Batiy license area. Water flow tests, engineering studies, a geochemical survey, as well as new processing tests for Vostochny were also completed during the first half of 2018. 

Since February 2018, the joint venture partner, GV Gold, is the operator of the exploration program on the Krasny project. 

The initial mineral processing test was made in 2012 with a 60 kg bulk sample, representing primary ore. The test confirmed an 85 per cent recovery with conventional gravitation-flotation-leaching technology. In February 2015, two bulk samples of 1,000 kg each were sent to the Irgiredmet engineering company in Irkutsk, Russia, for metallurgical processing tests. The results were received in November 2015 with a recommendation for similar processing technology for both the oxidized and primary rock with a projected total recovery of 90 per cent for the primary ore and 75 per cent for the oxidized ore. A second mineral-processing test based on new samples for the oxidized part of the Upper mineralization was carried out during December 2015-March 2016. The gold recovery via gravitation-flotation-leaching process for Oxide ore from the Upper structure totalled 78-79 per cent.


In April 2017, a mineral processing test of a bulk sample, representing the gold ore of the Upper structure, was completed by Irgiredmet. The total weight of the processed sample was 3,259 kg with an average gold grade of 1.92 g/ t. The test developed and fine tuned the previous metallurgical results and recommended a flow chart for the Krasny gold ore treatment processes. The proposed process will involve gravitation and flotation circles with further leaching of gravity and flotation concentrates. All operations will be developed on the Krasny site. The Krasny processing plant will produce gold doré bars, which will be further refined at an external refinery to bankable quality gold bars. The through gold recovery for the ore from the Upper structure is expected at 85.5 per cent, which is in line with previous processing test results. There is a further potential to increase gold recovery to some 89 per cent which is achieved for similar types gold ore at neighbouring plants in the area.


During the first quarter of 2018, a mineral processing test for the Vostochny gold mineralization was completed. The processing test was done by TOMS Engineering, a mining engineering consultancy firm based in Irkutsk, Russia. The target was to evaluate the possibility of processing the gold ore from the Vostochny mineralization using the flow chart previously proposed for the Krasny gold ores. The test confirmed that the ore from the Vostochny mineralization could be processed using the processing flow chart proposed for the Krasny ore with 90.2 per cent total gold recovery. The report confirmed that the gold ore from Vostochny could be mixed in any proportions with the ore from the Krasny deposit with no loss in gold recovery. It was proven that Vostochny is a similar type of gold mineralization as Krasny and may be viewed as a satellite deposit of Krasny. This means that Krasny and Vostochny may be developed together, sharing the same infrastructure and processing plant.

On December 28, 2015, a mineral reserve report for the Upper mineralization of the Krasny deposit was completed and filed with the Russian GKZ authorities in Irkutsk. The report was formally approved by the Federal Agency on Subsoil Usage (subsidiary of the Russian Ministry on Natural Resources) in Krasnoyarsk on March 30, 2016. The report classified the Krasny mineralization to be a deposit with total ore reserves under the C2 category of 6,317 ktons with an average grade of 1.55 gr/ t, which makes 9,767 kg of gold (314 koz). The report recommends the deposit for pilot gold production.

In parallel to the GKZ report, a report on the mineral resources in accordance with the JORC provisions was developed by Micon International Co Limited. Micon is a world leading mineral industry consulting company with offices in Toronto and Vancouver (Canada) and in Norwich (United Kingdom). Micon has previously been involved in other projects in the Bodaibo area and is therefore familiar with the local geology. The report confirmed totally 955 koz of I&I bedrock gold resources, including 288 koz of Indicated mineral resources (7,848 ktons of rock at an average grade of 1.141 g/t Au) and 667 koz of Inferred mineral resources (12,324 ktons at an average grade of 1.682 g/t Au), all within an economically minable open pit. 


In February 2017, an update of the 2016 JORC resource estimation was initiated by Micon. The report was completed in September 2017 and confirmed a 45 per cent increase of the gold resources to 1,388 koz of gold y-o-y. The resource estimation included both the Krasny and Vostochny mineralizations. The report also included Probable reserves for Krasny. For Krasny, the resource estimation showed 273 koz of Indicated mineral resources (mineral resources of 7,617 ktons at an average grade of 1.11 g/ t Au) and 1,052 koz of Inferred mineral resources (18,536 ktons at an average grade of 1.76 g/ t Au). The resource statement also reported 240 koz of Probable gold reserves (7,327 ktons at an average grade of 1,02 g/ t Au) as a part of total gold resources. Vostochny showed a total of 63 koz of Inferred mineral resources (1,114 ktons at an average grade of 1.76 g/ t Au). All resources were reported within economically minable open pits. were reported within economically minable open pits.


In May 2018, field exploration activities on Krasny were stopped and an update of the JORC resource estimation was issued in early June. The report was developed by Micon International. The report was based on the exploration data acquired through March 2018. The new estimation of 1,832 koz of Indicated and Inferred gold resources for the Krasny project showed a 32 per cent increase since the previous year, reflecting successful exploration activities during 2017 and early 2018. The resource estimation included both Krasny and Vostochny. For the Krasny deposit, the resource estimation showed 291 koz of Indicated mineral resources (mineral resources of 7,539 ktons at an average grade of 1.20 g/ t Au) and 1,202 koz of Inferred mineral resources (18,515 ktons at an average grade of 2.02 g/ t Au). The Vostochny mineralization showed a total of 339 koz of Inferred mineral resources (6,689 ktons at an average grade of 1.57 g/ t Au). All resources were reported within economically minable open pits at 1,250 USD/Oz gold price. The report also includes 257 koz of Probable gold reserves.

Download the 2016 JORC report here

Download the 2013 JORC report here.

Download the 2018 JORC report here (English)

Download the 2018 JORC report here (Russian)

Several scoping studies covering the Krasny development have been completed over the last few years. All have provided positive outcomes. The first report was made by Miramine Mining Consultancy in 2013. The next report was developed by Irgiredmet in 2016. In October 2017, an Investment justification report was commenced by TOMS Engineering, focusing on development of the Upper mineralization only. In parallel with the Investment justification report, TOMS Engineering also prepared a Scoping study for the development of both the Upper and Lower Mineralization. The study did not, however, include the newly discovered Vostochny mineralization, leaving this as an upside. The study evaluated different gold production options, including the development of open pit production and a combination of open pit and underground mining. All production scenarios returned positive free cash flows. The best outcome is estimated when producing both the Upper and Lower mineralizations in an open pit, with total undiscounted free cash flow of MUSD 373 at a fixed gold price of 1,250 USD/oz and production costs of 601 USD/oz. 

The most recent Scoping study was done in 2019 by AMC Consultants Pty Ltd from Perth, Australia (AMC). The study provides several production scenarios for developing the Krasny project either as an open pit alone, or combined open pit and underground mine, with annual processing plant throughput capacities varying from 0.4 Mt to 3 Mt. All scenarios would return positive NPVs before application of potential tax benefits. The recommended production option for Kopy Goldfields, which provides the highest internal rate of return (IRR) but not the highest NPV for the investments, is one that uses an annual 1 million tonne plant throughput rate and a combined open pit and underground mine at the Krasny deposit, in combination with an open pit mine at the Vostochny mineralization, with LOM 16 years and average annual gold production of 40,000 to 50,000 oz. Using a gold price of USD 1,300/oz, this option would generate an IRR of 26% and NPV of MUSD 104 pre-tax at 6% discount rate.

Comparison of Krasny production scenarios – gold price of USD 1,300/oz

Production Scenario 0.4 Mtpa Open Pit** 1 Mtpa
Open Pit
and Under-ground**
3 Mtpa Open Pit** 1 Mtpa Krasny Open Pit and Underground with Vostochny
Scenario 1 2 3 4
Pre-tax NPV at 6% discount rate, MUSD 16 62 301 104
Pre-tax IRR, % 11 23 20 26
LOM, years 16 15 12 16
Mill capacity pa, Mt 0.4 1.0 3.0 1.0
Average gold grade, g/t 1.2 2.0 1.6 1.8
Total CAPEX, MUSD 38 105 150 107
Average open pit stripping ratio, t/t 5.0 4.5 13 7
Average LOM annual gold production, koz 13 39 110 47
Average operating costs, USD/oz 860 1 100 930 1 100
Pre-tax undiscounted payback period, years 11 5 8 5

In January 2016, the PreFeasibility study was commenced, starting with detailed Scoping study calculations.

Historical exploration (before 2010) within the license area

  • Detailed geochemical and geophysical survey of 1:25,000 scale
  • 14,723 meters of core drilling
  • 130 meters of underground shifts

Exploration activities 2010 – 2015

  • Recognizance geological mapping of 100 km
  • 103 km of exploration trenches
  • Review and digitalize historic exploration data. Design of exploration activities
  • Totally 30,764 meters of core drilling 100 drill holes
  • Scoping study reports 
  • Engineering and metallurgical processing tests 
  • Mineral reserve report under the GKZ-regulations
  • Mineral resource report under the JORC-code

Activities 2016

  • Update of Mineral resource report under the JORC-code 
  • Mineral processing flow chart commenced
  • Investment justification report commenced
  • 95 drill holes
  • 18,838 meters of core drilling
  • 1,965 meters of exploration trenches  

Activities 2017

  • New bedrock exploration license “Batiy” granted, bordering the Krasny license to the northwest and covering 86 km²
  • Results from a mineral processing test of Krasny ore confirm 85.5 gold recovery with an average grade of 1.92 g/ t
  • Updated JORC resource report released showing 45 % increase of gold resources
  • New scoping study based on several production scenarios – all yielding positive free cash flows
  • 79 core holes drilled, totaling 19,569 meters
  • Activities 2018
  • A JORC resource estimation for Krasny shows a 32 per cent increase of the gold resources to 1,832 koz for the Krasny project since 2017.
  • Results from a mineral processing test of Vostochny ore confirms a 90.2 per cent gold recovery, using the same flow chart proposed for the Krasny ores.
  • Drilling of 11,638 meters of core holes, primarily within the Krasny and Vostochny structures and within the Batiy license area

Activities 2019

  • A proposal for electricity supply from the local national electricity land grid for 15 MWt capacity was granted, which should be enough to support a production start.
  • New scoping study providing several production scenarios, all with positive NPV. The scoping study provides both a valuation benchmark for the project and several potential mine development alternatives. The study is based on the most recent gold resource estimation from 2018. 

Total investments

Cumulative joint investments into the Krasny project totalled MUSD 20.1 at the end of 2019.


In June 2019, AMC Consultants Pty Ltd from Perth, Australia, issued a scoping study for the Krasny project, providing several production scenarios. The recommended production option for Kopy Goldfields, providing the highest internal rate of return (IRR) but not the highest NPV for the investments, is one that uses an annual 1 million tonne plant throughput rate and a combined open pit and underground mine at the Krasny deposit in combination with an open pit mine at the Vostochny mineralization. This option was evaluated using a gold price of USD 1,300/ounce and features the following: 

  • Pre-tax NPV of USD 90 to 104 million at 6% discount rate and pre-tax IRR of 20% to 26%
  • Mine life of approximately 16 years and a discounted pre-tax payback period of 6 years
  • Total capital expenditure (CAPEX) of approximately USD 107 million with upfront CAPEX of USD 66 million
  • Average metallurgical recovery over mine life of 87% using a gravity-flotation-CIL flowsheet
  • Average gold head grade of 1.8 g/t
  • Average life of mine (LOM) annual gold production of 40,000 to 50,000 ounces
  • Average LOM stripping ratio (including both open pit and underground) of 7 tonnes waste per tonne of ore

Going forward

Having developed the Krasny project from the initial greenfield to the current Prefeasibility stage of exploration from 2010 to 2019, Kopy Goldfields and GV Gold believe it is a good time to realize the value of the project. In the middle of 2018, the field exploration activities on Krasny were put on hold and the project was prepared for a sale. Since then, discussions have been held with GV Gold regarding the different options for a sale. Although an external sale of Kopy Goldfields’ part in the Krasny project is the Board´s dedicated goal, being the 49% owner means that the majority partner´s interest must be taken into consideration.