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. Last Updated: 07/27/2016

Polyus Lists in London Amid Nerves in the Mining Market

The country's largest gold mining company, Polyus, listed shares on the London Stock Exchange on Monday, three weeks after a market scare in London that the Kremlin had begun a program to nationalize Siberia's gold fields.

Trading was thin despite easing of concerns after authorities issued a clarification last week. Though the stock was making its debut on the London exchange, the listing was not technically an initial public offering. Polyus shares already traded as American depositary receipts in the over-the-counter market in the United States.

Denis Davydov, head of investor relations for Polyus, said the listing would bolster the stock's value by making it available to a wider audience.

"This means more liquidity and more exposure," Davydov said.

Polyus listed the shares as the final step in a complicated deal to spin off the precious metals arm of metals giant Norilsk Nickel, controlled by Vladimir Potanin. Norilsk is the world's No. 1 producer of nickel. The strategy was to elevate the value of its overlooked gold assets.

Polyus produced 1 million troy ounces of gold last year. It is believed to be a contender to mine Sukhoi Log, an unmined gold deposit north of Lake Baikal in southern Siberia that is one of the richest undeveloped gold deposits in the country.

Russia is attractive to gold investors because it is believed to have large undiscovered reserves -- the dream of striking gold does not always disappoint.

"Russia's gold resource base is underexplored," said Sergey Donskoi, a metals analyst at the Troika Dialog investment bank. "Through exploration you can develop a portfolio of reserves. You may or may not be successful. It depends on your skill, and your luck."