Mining company Polymetal has agreed the first $125-million green loan in the Russian metals and mining industry with Societe Generale to finance investments in the transition to a sustainable and low-emissions economy under its recently-adopted green financing framework.

The loan proceeds will be allocated to projects among the following categories: clean transportation, renewable energy, energy efficiency and sustainable waste and water management projects, which contribute to Polymetal's sustainability goals and actions against climate change.

This is the third sustainability-linked loan in the company's credit portfolio with the share of environmental, social and corporate governance (ESG) instruments now reaching 18% of net debt, or $280-million in total.

"We want our business model to be sustainable and we are actively investing in energy efficient technologies and responsible waste and water management. With the first green loan, we invite lenders to contribute to our ESG goals and we provide comfort to stakeholders that our green projects and strategy are aligned with the global Sustainable Development Goals", said corporate finance director Eugenia Onuschenko.

Societe Generale will provide a six-year loan with a three-year grace period under the framework, which specifies eligible ESG projects and criteria for their long-term funding. The loan can be extended to seven years on the first anniversary of signing.

“This is a very innovative transaction in mining which was made possible by embedding the company's ESG principles into investment decisions. Societe Generale is delighted to support Polymetal's continuous progress towards achieving a low-emissions future and more efficient use of resources", said Societe Generale global head of mining, metals and industries finance Stephanie Clement de Givry.

Polymetal said it would fully allocate the green loan proceeds towards eligible green projects within 24 months from the first utilisation.