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. Last Updated: 07/27/2016

Highland Gold Says It Will Resume Mining This Week

Itar-TassA view of the Darasun mine, where 25 miners were killed in an accident.
Highland Gold Mining will resume production this week at a mine in eastern Siberia where a fire killed 25 people, its managing director said Monday, as the town of Darasun began to bury its dead.

Highland, the country's fourth-largest gold miner, would restart the open pit on Wednesday or Thursday but would need more time to inspect an underground shaft where fire is raging for a fifth day, said Highland's managing director, Henry Horne.

"The main idea is to get normality back to the operation as soon as possible," Horne said. "We will have some production losses, yes; but it's not that significant in the total overall production of Highland Gold."

Rescuers on Sunday found the bodies of the last four miners trapped deep underground by a fire caused by welding work at the mine in Chita region, which borders China. Eight of the 33 miners trapped managed to escape.

"The shaft is still burning," Horne said. "Once we get the fire extinguished, rescue teams will go in and make an assessment."

Darasun is the smaller of Highland Gold's two operational mines in Russia. It produced 11,761 ounces of gold in the first half of 2006, about 13 percent of the company's total output. The open-pit mine accounts for about half of production.

Alfa Bank said the worst-case scenario would see a 3 percent to 5 percent decrease in Highland's total 2006 output.

Highland shares fell 2.6 percent on Monday and have plunged 17 percent since Thursday, when the fire started.