Krasny is Kopy Goldfields’ most advanced gold project to date. Intense exploration drilling has been performed at the site since 2014, after a joint venture agreement had been signed with GV Gold to develop the promising gold deposit together. Feasibility studies were initiated in 2015 in preparation of starting the Krasny gold mine.

Located in the vast expanse of the Patom Highland in the Bodaibo area of Irkutsk region of Russia and 75 kilometres from the city of Bodaibo, Krasny sits on an area of 31 square kilometres. The area is known for its alluvial gold production with four active placers within, or neighbouring, the license area.


Acquired: 2015

Mineral resources according to GKZ (’000)*:  P2: 1 koz

Valid until: 2030

Ownership Kopy Goldfields AB: 49 %

License area: 2.46 sq km (within the bedrock license)


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, also acquired a licence for alluvial mining which is located within the boundaries of the bedrock license.


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 localized 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 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 60m 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 14 (northwest) to the exploration line 58 (southeast) at 1725m. 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 20-80m at the flanks and up to 160-200m 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 20-100m.

The upper group of the ore bodies is about 900m long; the vertical span of the mineralization is 210-305m; the lower group is 1620m long, and the vertical span of the mineralization is 180-280m. The total span of the mineralization studied in boreholes is 430m (elevation 110-580m) the length along the strike is 1,620m.

The intensity of mineralization correlates directly with the degree of occurrence of quartz-sulphide veinleting and imposition of other hydrothermal-metasomatic alterations. Meanwhile, the quartz content in the mineralized zone does not exceed 2-3%. 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%. 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).


Summer 2014, Kopy Goldfields 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% interest in the Krasny Project by paying Kopy Goldfields MUSD 1 in cash and by financing an infill exploration program followed by a reserve 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 been financed by GV Gold in full. The 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.

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 2 MUSD in a conditional consideration cash payment from GV Gold.



During the first stage, exploration activities were aimed at confirming the existing model of the Krasny mineralization. Exploration drilling was started in July 2014 and 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. In February 2015, two bulk samples of 1,000 kg each were sent to the Irgiredmet Engineering Company in Irkutsk, Russia, for metallurgical bulk sample processing tests for gold recovery. 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% for the primary ore and 75% for the oxidized ore. During December 2015 – March 2016, a second mineral-processing test based on new samples for the oxidized part of the Upper mineralization was carried out. The gold recovery via gravitation-flotation-leaching process totalled 78-79%, which is hence better than the previous results of 75%.


Following the successful completion of the first stage of exploration of the Krasny deposit, the second stage was initiated in 2015, aimed at planning gold production.  A preliminary production model was drawn up based on available data in order to find the most optimal production 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 on June 10, 2015 and finalized on September 18 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 on December 14, 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 on February 25, 2016 and included 16 drill holes and a total of 3,504 meters of core drilling. 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. This could extend the life of the mine from the expected 8-9 years to 14-15 years. Further mapping out of the mineralization will now be carried out.


The third stage drilling of the exploration program was commenced in April 2016 and includes a range of exploration and feasibility activities. These include upgrading the category and increasing the volume of the gold resources, finalizing and approving the mineral processing technology, proceeding with the engineering and geotechnical studies for rock properties and the infrastructure positioning on site, as well as evaluating the potential for alluvial gold production.

By the end of August 2016, 37 drill holes, accounting for 9,052 meters of core drilling, had been completed, as well as 1,886 meters of trench sampling. In total, 9,216 fire assay tests for gold had been received. Most of the drilling has been focused on collecting core samples for developing a mineral processing flow chart.

Since these holes were drilled within the Central part of the Krasny deposit and mostly within the Upper structure, they have increased the density of drilling within the area of the previously approved Russian GKZ reserves, which in turn will lead to an update of the Russian reserves into a higher reserve category in the future.

The exploration results also confirm the modelling of the Lower structure mineralization, with new high grade intervals being discovered. From the drilling results there are confirmations that the Lower Mineralizations extends further along the strike both on the Western and the Eastern flanks outside the initial model of 2012. On the western extension it also comes closer to the surface. Mineralization is still open to depth on most of the drill profiles. All these facts support the expectation that the Krasny Central deposit could be bigger than just 1 Moz .

During the current exploration program a satellite gold mineralization within the Krasny North structure has been 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 a part of the bigger Krasny project. Krasny North has potential to become a supplement to the Krasny Central by sharing its infrastructure, mill, personnel and mining equipment.


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. 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. On March 30, 2016, the report was formally approved by the Federal Agency on Subsoil Usage (subsidiary of the Russian Ministry on Natural Resources) in Krasnoyarsk. The report classifies 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, that 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 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 JORC report was announced in May 2016, showing 288,000 oz of Indicated mineral resources (7,848,000 tons of rock at an average grade of 1.141 g/t Au) and 667,000 oz of Inferred mineral resources (12,324,000 tons at an average grade of 1.682 g/t Au) within an economically minable open pit. The resource estimation increases the quality of gold resources, with Indicated resources representing 30% of the total mineral resources reported, compared to 15% in the previous JORC report from 2013. The current estimation does not include the drill results acquired since January 2016.

While the previous resource estimate was based on 15,297 meters of core drilling, 1,362 meters of trench sampling and one mineral processing test; the current JORC estimate is the result of totally 31,195 meters of core drilling, 2,822 meters of trench sampling and 4 mineral processing tests. During the 2015 mineral processing test, it was discovered that the Krasny deposit has two types of ore – oxidized and primary – with different gold recovery ratios, which is now reflected in the new resource estimation. In addition, the previous resource estimate was based on an assumption of a gold price of 1,670 USD/oz, while the current estimate is based on the market price of 1,200 USD/oz.

Table 1. Mineral Resource Statement for the Krasny Gold Deposit, Irkutsk Region, Russia, Micon International, May 23, 2016*


Category Ore (kt) Au grade (g/t) Au (kg) Au (koz)
Indicated 7 848 1,141 8 958 288
Inferred 12 324 1,682 20 732 667


In May 2016, a new positive scoping study was announced for the Krasny gold project, confirming the feasibility of the Krasny mine development with a total undiscounted free cash flow of USD 94 million at a fixed gold price of 1,100 USD/oz and estimated total production costs of 475 USD/oz.

The scoping study was performed by Irgiredmet engineering consultancy during January – March 2016 and included all exploration results including Stage 2 of the exploration program. The study evaluated financial results of gold production from the Upper structure only and did not include any development of the Lower structure – thus leaving the upside from gold production of the Lower structure for the future. It was used as an external justification for moving the Upper gold structure into Feasibility studies.


During 2016/2017, the Krasny project will move into Pre/Feasibility Studies, equipment procurement, construction and commissioning.

In January 2016, the PreFeasibility study was commenced, starting with detailed Scoping study calculations. With a possible increase of the mine and plant capacity, the first gold production is expected in 2019, which will be further reviewed during the detailed Feasibility study.


In July 2015, LLC Krasny, the Russian joint venture company, acquired an alluvial gold license. The license area includes two separate blocs, “Ruchey Krasny 1” and “Ruchey Krasny 2” and is located within the contour of the Krasny bedrock gold license, already held by LLC Krasny, where bedrock exploration activities are currently being conducted. The Krasny Ruchey license entails the right to explore and produce placer gold for 15 years. The total forecast of the Rus-sian GKZ resources of the P2 category amount to 30 kg. In addition to LLC Krasny, three more companies participated in the auction and the final acquisition price totalled KRUB 280 (approximately KUSD 5), which was paid by LLC Krasny.

The alluvial project will be developed on a merit basis. If alluvial production from the Krasny Ruchey license area proves to be profitable, the alluvial gold will be produced in parallel with development of the Krasny bedrock mining operations so that they create synergies in terms of stripping operations. LLC Krasny does not need to run the placer mining itself since there is a number of alluvial producers in the area that can serve as operator of the project. In addition, GV Gold has both equipment and experience of alluvial mining in the area.


A successful completion of Stage 3 of the exploration program will achieve the following targets:

  • An increase of resources by drilling the Krasny Central Upper and Lower mineralization along the strike and testing the Krasny North Mineralization.
  • An upgrade of the Krasny Central Upper and Lower Mineralization into higher categories
  • A finalized mineral processing flow chart and updated financial production model
  • A basis for decision to move the Krasny project into construction and equipment procurement during 2017
  • A completed exploration to allow for decision on placer gold production


  • Mineral reserve report under the GKZ-regulations
  • Mineral resource report under the JORC-code commenced
  • Metallurgical processing tests
  • Hydrological tests
  • 49 drill holes
  • 7,551 meters of core drilling


  • 51 drill holes completed
  • 7,916 meters of core drilling
  • 1,712 meters of exploration trenches
  • Engineering and metallurgical processing initiated to develop the optimum processing technology


  • Scoping study report published
  • Updated mineral resource estimation
  • 1,695 meters of core drilling
  • 195 meters of exploration trenches


  • A mineral resource estimate within JORC Code
  • 11,030 meters of core drilling
  • 1,161 meters of exploration trenches


  • Design of exploration activities
  • Commence field activities and analysis
  • Krasny exploration memo 2011
  • 2,572 meters of trenching


  • Recognizance geological mapping of 100 km
  • 100 km of exploration trenches
  • Review and digitalize historic exploration data
  • Prepare and communicate exploration plan


  • Detailed geochemical and geophysical survey of 1:25000 scale
  • 14,723 meters of of core drilling
  • 110,797 meters of exploration trenches
  • 130 meters of underground shifts