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Indian-origin commodities investor Sun Group today entered into an agreement with a Russian sovereign investment fund, China National Gold Group and a few entities from Brazil and South Africa to invest up to USD 500 million to develop a gold deposit in Siberia. An MoU was signed by the Khemka family-owned Sun Group (which is primarily focused on Russia and Ukraine) with Russia's Far East and Baikal Region Development Fund, China National Gold Group Corporation, South Africa's Trans Africa Capital and Brazilian investor Antonio de Moraes to develop the Kluchevskoye gold deposit in Chita region in eastern Siberia, it said in a statement here on the sidelines of BRICS summit. The proposed joint venture aims to develop the Kluchevskoye gold deposit into an open pit mine and heap leach operations with an expected production rate of 12 million tonne of ore per year and gold ore production of over 6.5 tonne per annum, the company said. Agreement was signed between the two parties, and the pre-production investment is expected to be USD 400-500 million, it said. China National Gold Corporation will be the major shareholder with the majority equity interest in the joint venture firm and will provide management and development expertise and have responsibility for raising long-term debt financing for the project. The Far East and Baikal Region Development Fund of Russia will also be an "important shareholder" in the company. The Sun Group has been working in Russia for long.
Shiv Khemka, vice-chairman of the group has established and led one of the first private equity funds in Russia, Sun Capital Partners.
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