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Highland Gold's H2 output drops 21%

Highland Gold Mining Ltd., a British company that produces gold in Russia, said H2 output dropped 21% due to lower recoveries at its Mnogovershinnoye unit and a fatal underground fire.

The St. Helier, Jersey-based company produced 76,339 ounces in the six months ended Decemner 31, compared with 96,467 ounces a year earlier, according to a statement released today. It received an average of $636 for each ounce produced, compared with $467. A September 7 fire underground at Darasun killed 25 workers.

Highland Gold Mining Ltd. is continuing production from Darasun's open-pit mine and is keeping the underground mine mothballed while it evaluates a possible rehabilitation. Output at Darasun declined to 4,637 ounces in the H2 from 8,408 ounces. Production at Mnogovershinnoye, also known as MNV, fell to 71,702 ounces from 88,059 ounces.

Highland's full-year output rose to 167,544 ounces from 160,216 ounces. Shares of Highland dropped 4 pence, or 2.1%, to 187 pence as of 8:44 a.m. in London. The stock has declined 41% over the past 12 months, valuing the company at £364.5 million ($710.9 million). (Bloomberg)