Russia's Polyus Gold (LSE:PGIL) on Monday released its preliminary operating results for the full year ended December 31, 2012.
In contrast to other major gold producers like Barrick Gold and Kinross which have been struggling to bring major projects on stream, Polyus is even surpassing its own already ambitious targets.
Production of refined gold increased by 12% to a record 1.68 million ounces (2011: 1.5 million ounces) and exceeded the 2012 production target by 5%.
2012 gold sales are estimated to have reached $2.8 billion, a 22% increase compared to $2.3 billion a year ago.
The 2013 forecast for refined gold production was set at 1.7 million – 1.8 million ounces.
Shares in Polyus Gold, partially listed in London, is up more than 12% since the announcement last week that billionaire Mikhail Prokhorov's Onexim Group has agreed to sell a 37% stake in the company
Observers say a merger with Russia's number two gold miner Polymetal is a likely outcome of the news that Prokhorov was selling the stake to an unnamed group of investors selected by billionaire Suleiman Kerimov’s Nafta Moskva, which holds a 40% sake in Polyus.
Kerimov – who was also the architect of the 2010 merger between Silvinit and Uralkali to form the world's largest potash maker – had attempted to merge the two gold miners last year but could not come to terms.
Polyus has a partial listing in London where it is worth roughly to $4 billion while Polymetal is included in the FTSE-100 with a market cap of $6.6 billion. Polyus's plans for a London IPO has been repeatedly delayed due to its shareholder structure.
A combined group would be the world's fifth or sixth largest producer of gold (on par with Canada's Goldcorp) with in excess of 2.7 million ounces predicted for 2013.
In terms of reserves together Polyus and Polymetal ranks number three globally.
Polymetal is due to release results later this week.