Sanctions hit gold: Kazakhstan’s Solidcore slashes production by 42%

Solidcore’s output nearly halved in the first quarter of 2025 as international sanctions disrupted shipments / Photo: Shutterstock, photo editor: Dastan Shanay

Kazakhstan-based gold mining company Solidcore Resources plc, formerly Polymetal International plc, reported a 42% year-on-year (YoY) drop in gold production in the first quarter (Q1) of 2025, producing 68,000 ounces of gold equivalent, according to performance data published on its website.

The company attributed the decline primarily to delays in shipping gold-bearing concentrate from its Kyzyl deposit in Kazakhstan to the Amursk POX processing facility in Russia. The delays stem from operational challenges at the Amursk plant linked to the impact of international sanctions against Russia.

As a result, the Kyzyl site has accumulated a stockpile of 41,000 ounces of gold in concentrate. Shipments are expected to resume in May, with processing anticipated to be completed by year-end.

Despite the logistics setback, gold concentrate production at Kyzyl rose 6% YoY to 97,000 ounces, driven by higher ore grades. In contrast, the Varvara deposit saw a 10% decline in output, in line with expectations due to lower-grade ore and reduced third-party processing volumes.

Sales in Q1 totaled 38,000 ounces of gold equivalent, generating $109 million in revenue. The company said the lower figures were due to temporary shipment delays. Vitaly Nesis, CEO of Solidcore Resources plc, highlighted that the company remains confident in meeting its full-year production targets, with sales expected to rebound in the second half of the year.

«The fundamentals of our business remain strong, and we expect a meaningful recovery in the coming quarters with concentrate stockpiles set to start unwinding in May,» Nesis said.

In a strategic move, Solidcore also announced plans during the quarter to acquire the Tokhtar deposit, located near the Varvara hub. The site holds an estimated resource base of 1.1 million ounces of gold at an average grade of 2.4 grams per ton. The company is currently securing regulatory approvals and aims to complete the acquisition of an initial 51% stake by Q3 2025.

Solidcore has reaffirmed its 2025 production guidance of 470,000 ounces of gold equivalent, with total cash costs projected between $1,000 and $1,100 per ounce and all-in sustaining costs (AISC) estimated at $1,350 to $1,450 per ounce.

Despite the confirmed targets, the company’s board of directors announced it does not plan to issue dividends until the completion of its Ertis mining and processing plant (Ertis POX), currently under construction in a special economic zone in Kazakhstan’s Pavlodar region. The facility is scheduled for commissioning in the second half of 2028 and will have the capacity to process up to 300,000 tons of concentrate annually. The total investment is expected to reach $978 million.

Solidcore underwent significant restructuring following U.S. sanctions on its Russian assets in May 2023. In March 2024, those assets were sold to Russian firm Mangazeya Plus, owned by businessman Sergey Yanchukov, for $3.69 billion.

In August 2023, the company completed its re-domiciliation from Jersey to the Astana International Financial Centre (AIFC), listing its shares on the Astana International Exchange (AIX). It officially rebranded as Solidcore Resources in June 2024. The Moscow Exchange suspended trading in the company’s shares in September 2024, with formal delisting following on Oct. 15.

In Kazakhstan, Solidcore operates the Bakyrchik deposit in the Kyzyl ore zone of the Abay region, as well as the Varvara and Komar deposits in the Kostanay region. In 2024, the company expanded its portfolio by acquiring a 55% stake in the Syrymbet rare earth-polymetallic deposit in the North Kazakhstan region for $82.5 million.