#125.000 POLYMETAL Investor Presentation Troika Dialog THE RUSSIA FORUM 2010 3-4 February 2010, Moscow#2Cautionary statements This presentation includes forward-looking statements. This is not an offer to sell, or an invitation of an offer to purchase, securities in any jurisdiction These forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The words "believe," "expect," "anticipate,” “intends,” “estimate,” “forecast,” “project,” "will," "may," "should" and similar expressions identify forward-looking statements. Forward-looking statements include statements regarding: strategies, outlook and growth prospects; future plans and potential for future growth; liquidity, capital resources and capital expenditures; growth in demand for products; economic outlook and industry trends; developments of markets; the impact of regulatory initiatives; and the strength of competitors. The forward-looking statements in this presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including, without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, and the Company may not achieve or accomplish these expectations, beliefs or projections. Neither the Company, nor any of its agents, employees or advisors intend or have any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this presentation. 2#3Polymetal-key facts 2009 Production Gold 311 Koz (+9% Y-o-Y) Silver 17.3 Moz (+1% Y-o-Y) Gold eq.1 0.6 Moz (+5% Y-o-Y) Co-product Cash Costs (Gold equivalent) 1H2009 442 US$/oz 2008 Adj EBITDA US$ 193m 2P Reserves (JORC) 1 Gold eq. 14 Moz @ 4.1 g/t Capital Structure Market cap Net debt³ US$ 3.3 bn²(358m shares) c. US$ 580m © 2009 Polymetal 1 Using 1:60 Ag/Au and 5:1 Cu/Au conversion ratios 2 LSE price as of February 1, 2010. Market cap is calculated without accounting for treasury shares held by Polymetal 's subsidiaries (c. 41m). Total ordinary shares account for 399.4 million. 3 As at December 31, 2009 3#4Polymetal: Asset portfolio Voro Production: 150Koz Au Reserves: 1.7Moz Au @ 2.8 g/t Cash costs 1H09: US$359/oz of Au Production • Development © 2009 Polymetal Dukat Operations Production: 15.6 Moz Ag and 39 Koz Au Reserves: 360Moz Ag @ 405 g/t 0.85Moz Au @ 1.0 g/t Cash costs 1H09: US$7.2/oz of Ag Mayskoye Resources: 7.5 Moz Au @ 11.8 g/t St.Petersburg Yekaterinburg Kairovsk Kazakhstan Varvarinskoye Reserves: 1.3Moz Au @ 1.1 g/t 151m lb Cu @ 0.7% Resources: 3.1 Moz Au @ 1.1 g/t 313m lb Cu @ 0.3% Magadan Omolon Operations Reserves: 0.7Moz Au eq. @ 16 g/t Resources: 3.3Moz Au @ 3.1 g/t Khakanja Production: 136Koz Au eq. Reserves: 1.1 Moz Au eq. @ 9.5g/t Cash costs 1H09: US$388/oz of Au Amursk POX hub+Albazino Reserves: 2.3Moz Au @ 4.1 g/t Production numbers are given for the full year 2009 Reserves and resources are as at January 1, 2009 4#5Moving towards gold Revenue Split*,% © 2009 Polymetal 1 5 Resource Split*,% 2 31 33 33 33 51 46 49 49 54 64 54 65 55 51 2008 2009 2012F 65 2008 2009 2012F Gold Silver Copper Using 1:60 Ag/Au and 5:1 Cu/Au conversion ratios 5#6©2009 Polymetal Hochchield Eldorado Gold Petropavlovsk Red Back Mining Randgold Resources Centerra Gold 1,104 EV/Reserves 998 879 860 756 472 427 327 295 Agnico-Eagle Mines IAMGOLD Corporation Polymetal Polyus Yamana 135 121 Hochschild Cheap, High-grade reserve ounces Agnico-Eagle Mines Using 1:60 Ag/Au and 5:1 Cu/Au conversion ratios Based on JORC reserves. Actual as at January 20, 2010 Polymetal Randgold Resources 4.3 8.2 Average reserve gold eq. grade 4.1 3.4 2.9 2.1 2.0 1.6 1.5 1.4 1.3 Centerra Gold IAMGOLD Corporation Red Back Mining 6 Yamana Polyus Eldorado Gold Petropavlovsk#7Compelling growth profile Gold Equivalent ounces, Koz © 2009 Polymetal 1400 110 1200 200 1100 110 30 110 200 200 160 800 ■Varvarinskoye 100 90 190 230 ■Mayskoye 40 599 140 573 13 150 140 130 Omolon ops Albazino 131 136 170 ■ Khakanja 130 130 160 Voro 132 150 420 400 400 360 310 300 2008 2009 2010 2011 2012 Using 1:60 Ag/Au and 5:1 Cu/Au conversion ratios 2013 Dukat ops 7#82009 M&A activity: 4 deals closed Resource, Moz US$/ oz Acquisition Full EV, US$m Strategic Rationale (Au eq.) resource Goltsovoye 1.1 47 45 Bolt-on to Dukat Sopka 1.4 95 67 Bolt-on to Omolon Mayskoye 7.5 166 22 Varvarinskoye 3.8 258* 68 Total/ Average 13.8 © 2009 Polymetal 566 41 Using 1:60 Ag/Au and 5:1 Cu/Au conversion ratios *With limited (US$90m) recourse to Polymetal World-class deposit fitting with Albazino Immediate cash flows. and entrance to Kazakhstan 8#9Per share metrics demonstrate substantial shareholder value creation © 2009 Polymetal Reserves (Au eq.), koz/share 11% Resources (Au eq.), koz/share 60% 88 36 39 40 55 59 2007 2008 2009 2007 2008 2009 Using 1:60 Ag/Au and 5:1 Cu/Au conversion ratios 2009 calculated based on 358 million shares. 9#10Existing Operations#11Dukat Operations Remaining LOM: Dukat 17 years - Lunnoye/Arylakh - 14 years Selmchan 380 km Lunnoye Dukat Dukat Omsukchan 41 km Goltsovoye Myakit 650 km Atka • ⚫ Dukat processing plant expanded from 0.9 to 1.5Mtpa at a capital cost of US$60 million • • The ramp up of the plant is complete and the design capacity of 125 Kt per month is expected to be achieved in Q1 2010: The capacity of the underground mine will be increased to 900 Ktpa in 1H 2010. Stoping at Goltsovoye will commence in Q3 2010 (70Kt of ore is planned for 2010); development started in Q3 2009. • Active near-mine exploration resumed in 2H 2009, $8 million planned spending for 2010 Yabloneviy Stekolniy • Sokol Magadan © 2009 Polymetal 11#12Voro Remaining LOM: oxidized ore reserves - 6 years primary ore reserves - 15 years • CIP Expansion successfully completed and ramped . • • up on time and on budget at a capital cost of US$22 million Mining of oxidized ore form the southern pit is expected to commence in Q2 2010. 200 Kt of ore to be mined at Degtyarskoye and processed at the Voro CIP plant during the year. 2010 production to reach peak 160 koz Regional exploration program to be resumed in 2010; Fevralskoye to replace Degtyarskoye as the supplemental source of high-grade ore © 2009 Polymetal 12#13Khakanja Remaining LOM: 7 years • ⚫ 2010 is expected to be the peak year for Khakanja in terms of gold equivalent production due to a record contribution from Yurievskoye • • • • It is planned to mine, transport and process approximately 140 Kt of high-grade ore from Yurievskoye. High-grade underground mining at both Khakanja and Yurievskoye to supplement lower- grade open-pit starting from 2H2011 Silver recoveries in 2009 increased from 52% to 57%. Further improvement expected Regional exploration to be resumed in 2010 with US$4 million spend © 2009 Polymetal 13#14Varvarinskoye Asset • Large gold/copper deposit located in established mining district with excellent infrastructure and significant exploration potential • Turnaround plan formulated: • - Strengthen grade control program - Additional investment in mining equipment to catch up with insufficient waste stripping - Streamlining and optimization of processing operations An opportunity to significantly improve operation economics through production increase and lower costs Reserves and Resources 2P MI&I Ore tonnes (Mt) Au grade Au (moz) (g/t) Cu grade (%) Cu (M lb) 36 1.1 1.3 0.7 151 92 1.1 3.1 0.3 313 Strategic rationale . Entry into Kazakhstan - one of the most attractive gold mining regions in the former Soviet Union with many further attractive targets; Acquisition of a large modern plant, located in the region with excellent infrastructure, cheap energy, and highly prospective geological settings. • Tremendous reserve growth potential after the streamlining and optimization of mining and processing operations. © 2009 Polymetal 14#15Cash costs (Gold Institute Standard) Dukat & Lunnoye $/oz silver Voro $/oz gold Khakanja $/oz gold 4.8 6.6 8.1 7.2 311 420 413 359 216 442 513 388 2006 2007 2008 1H 2009 2006 2007 2008 1H 2009 2006 2007 2008 1H 2009 Dukat & Lunnoye $/tonne milled 119 Gold Silver Voro $/tonne milled Khakanja $/tonne milled 109 81 63 100 76 93 اسالنا 35 31 26 35 2006 2007 2008 1H 2009 2006 2007 Gold 2008 Silver 71 1H 2009 2006 2007 2008 1H 2009#16Development projects#17Polymetal's Advantage: Processing Hubs • Financial capital and human capital • synergies Risk mitigation Flexibility and long life. Management concentration on limited number of projects Creating centralized processing facilities for the treatment of materials from different sources © 2009 Polymetal 17#18Amursk POX Hub • Large amount of refractory ore bodies in the Far East Russia • Processing refractory concentrates from across the Russian Far East • Absence of processing capacity for refractory ores in the region • Very expensive energy and labor in remote areas • Amursk location: -Cheap power -Skilled & stable workforce -Excellent transportation infrastructure © 2009 Polymetal Pevek Maiskoe Bering Sea Nikolaevsk-on-Amur Albazino Amursk POX ~4800 km by sea 112 km Albazino 8 km Nikolaevsk-on-Amur Kherpuchi Oglongi Agnie-Afanasievsky Solnechnyi 571 km Komsomolsk-na-Amure Amursk 18#19Amursk POX Facility • ⚫ Capex $US110 million • Concentrate capacity 250 ktpa • Sulfide sulfur capacity • Opex 26 ktpa Concentrate preparation 35-70$/t of concentrate (depending on sulfur grade) Oxygen plant 02 Pre-oxidation POX autoclave oxidation CCD Washing EW of pregnant solution CIP processing Dore Dry-stack tailing Status: • Engineering complete (SNC Lavalin) • All major equipment contracted • • Earthworks commenced 35Kw power line, gas main, water supply construction started © 2009 Polymetal Neutralization 199 19#20Albazino • 1.5 mtpa flotation concentrator on site Construction commenced in November 2008, on schedule - expected to be completed in Q4 2010 Flotation concentrator in construction • US$160 million CAPEX • Concentrate transportation cost of US$70/mt • Reserve expansion to 5 Moz by end-2011 Reserves and Resources Au grade Au (moz) (g/t) Ore tonnes (Mt) 2P 17.4 4.1 2.3 MI&I 21.3 4.3 3.0 Mine camp © 2009 Polymetal 20#21Mayskoye • CAPEX to be drastically reduced by treating ore concentrate in Amursk. Current estimate US$130-170 million • Concentrate transportation costs (US$200-250/mt) more than compensated by a fall in treatment cost at Amursk: -Cheaper energy, labor and consumables Reserves and Resources Ore tonnes (Mt) Au grade (g/t) | Au (moz) MI&I 19.8 Outlook • • April - Feasibility study • - July Start of construction . 11.8 Q4 2011-First concentrate production © 2009 Polymetal 7.5 Nikolaevsk-on-Amur Amursk POX Pevek See roule Deposit • Sectlemen: Maiskoe Bering Sea 4800 km by sea 21 21#22Omolon Regional Processing Hub A number of small to medium size high-grade deposits in the Northeast Magadan region Numerous highly prospective epithermal Au-Ag ore occurrences in the region • Truck and mill high-grade ore . Heap (dump) leach low- grade ore • JORC-compliant reserve report and development plan for the entire Omolon hub (Birkachan, Tsokol Oroch, Sopka, Dalniy) in Q1 2010 • CIP plant restarted in Q3 2010 Sopka to provide high grade ore feed to the mill starting from 3Q2011 • Total capital budget of US$ 55_million © 2009 Polymetal Birkachan Lunnoe 380 km Sopka Kvartsevaya Dukat 571 km Dukat 41 km Magadan Road Deposit Sett emert Kubaka Oroch Evensk 22 22#23Capital Expenditure, US$ million 245 20 205 40 15 20 25 160 112 80 115 100 90 46 20 10 25 10 40 40 30 20 ■Varvarinskoye ■Mayskoye Omolon ops Albazino/Amursk ■Dukat/Voro expansions Maintenance capital 25 25 30 30 30 16 Exploration 2008A 2009 2010 2011 2012 © 2009 Polymetal 23#24Debt level and liquidity Current net debt approximately US$580 million (as at December 31, 2009) - US$ 250 million of Varvarinskoye liabilities maturing in 2013 (35%) and 2014 (65%) - US$ 350 million of medium- and long-term bilateral loans with Russian banks* - US$ 20 million of cash • Undrawn facilities secured by sales of gold and silver are in place for the total amount of US$ 270 million - US$ 100 million with SBERBANK (2.5 years) — US$ 100 million with NOMOS-BANK (2 years) US$ 70 million with Gazprombank (2 years) *Breakdown of long-term bilateral loans: • US$ 23m with Raiffeisenbank at Libor + 5.75%, final maturity Oct 2010 • • • US$ 70m with UniCredit Bank at Libor + 6%, final maturity Feb 2011 US$ 100m with Raiffeisenbank at Libor + 5%, final maturity Dec 2011 US$ 150m with VTB at Libor + 6.3%, final maturity Jun 2012 EUR 5m with NOMOS-BANK at Libor + 5.5%, final maturity 2015-2016 (ECA-covered loans) © 2009 Polymetal 24 224#25Corporate Governance#26Governance structure Board of Directors Ilya Yuzhanov Chairman, INED Ex-Minister of Russian Antimonopoly Ministry Martin Schaffer Represents PPF Group Marina Gronberg Represents Mr. Mamut John O'Reilly Committees Audit Committee Chaired by Jonathan Best 3 members INED ex-CEO of Lihir Gold Ashot Khachaturyants INED CEO of Sberbank Capital Sergey Areshev Represents ICT Group Konstantin Yanakov Represents ICT Group Vitaly Nesis CEO of Polymetal Russell Skirrow INED ex-Chairman ML Metals/Mining IB team Jonathan Best INED ex-CFO of AngloGold Ashanti Remuneration and Nomination Committee Chaired by John O'Reilly 3 members © 2009 Polymetal 26 26#27Ownership structure Mr. Alexander Mosionzhik, 5.6% Polymetal subsidiaries, 10.3% PPF Group (Mr. Peter Kellner), 19.6% Free Float (LSE, MICEX), 30.7% © 2009 Polymetal ICT Group (Mr. Alexander Nesis), 18.9% Mr. Alexander Mamut, 15.0% 27 22#28Polymetal Investment Thesis Quality assets with strong cash flows from operations Proven development and operational track record Unique strategy focused on processing hubs Strong production growth Strong corporate governance © 2009 Polymetal 28#29Appendix#30Share price performance: July 01,2008- Feb 1, 2010 PMTL LI Equity - Last Price (R1) PLZL LI Equity Last Price (R1) POG LN Equity - Last Price (R1) 118.2864 97.597 71.7042 KGC US Equity - Last Price on 01/29/10 (R1) 67.6654 RTSIS Index-Last Price (R1) 64.9834 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan 2008 2009 2010 Copyright 2010 Bloomberg Finance L.P. © 2009 Polymetal 120 118.2864 +18% Polymetal 100 97.597 -2% Polyus -80 71.7042 -28% Petropavlovsk 67.6654 -32% Kinross 64.9834 -35% RTS Index -60 -40 -20 20 01-Feb-2010 14:50:39 30 30#31Track Record and the Pipeline • • Outstanding track record in commissioning new mines All engineering and construction performed in-house by Polymetal Engineering In-house engineering expertise provides a key competitive advantage 2000 2002 2003 2004 2005 2009 2010 2011 Voro heap leach Dukat Khakanja Voro CIP Khakanja expansion 3Q - Omolon Lunnoye (Dec.) Voro Dukat expansion plant re- launched expansion 4Q - Albazino flotation concentrator completed processed at Omolon 3Q - Amursk POX plant completed 4Q - Mayskoye flotation concentrator completed - 3Q Sopka ore © 2009 Polymetal Greenfield projects Brownfield projects 31#32Exploration spending © 2009 Polymetal 16 10 17 15 10 25 Expensed Capitalized 2008 2009 2010 32#33Varvarinskoye • Transaction structure Purchase price: up to US$ 20 million - US$ 8 million in cash at completion - Deferred consideration of up to a maximum of US$ 12 million (plus any deferral interest), contingent on and calculable in reference to future prices of gold and copper. Existing debt and hedge liabilities (US$ 250 million) have been restructured and transferred to the Varvarinskoye asset level, with limited recourse to Polymetal (US$ 90 million). - Debt obligations in the principal amount of US$83.6 million, comprising of a US$34.3 million Export Credit Insurance Corporation, South Africa Loan and a US$49.3 million Commercial Loan - Liabilities resulted from crystallization of gold forward sales contracts (entered into historically at a strike price of US$574.25 per ounce) in the amount of US$166.4 million in present value terms. • The resulting obligations become due in 2013 (35% of the total) and 2014 (65% of the total) respectively, with interest accruing at a rate of LIBOR + 3% per annum during the term. © 2009 Polymetal 33 33