MOSCOW - Polymetal, one of Russia's largest gold and silver producers, is in talks with European banks on "green" project financing, CEO Vitaly Nesis told Reuters on Thursday, adding that a deal could be reached in the second half of 2020.

The agreement may involve four of Polymetal's projects such as the construction of a solar power plant and the reduction of water consumption at its deposits which need total investment of $60-million to $70-million within the next three years.

"We believe that we are ready for more difficult products linked to sustainability," Nesis said. "But unlike the classic sustainability-linked loans, this product is non-standard. We are among the first in our industry to think about this kind of financing, so it won't be fast."

In December, Polymetal has said, it would consider investing in Russia's largest rare earth project Tomtor, which is being developed by its top shareholder, Vitaly's brother and Russian businessman Alexander Nesis, amid growing demand for commodities used in the production of electric cars.

Polymetal may invest about $20-million at the current stage of the project and get a stake of under 10% in it, the CEO said.

"We do not want to do sharp moves, taking into account that it is a new issue for us," Nesis said. "We are investing in this company so that it can complete a feasibility study, and as a result of this feasibility study we will think further."

When asked if Polymetal could itself move into other non-precious metals sectors, the CEO said it was interested in copper projects in Russia or Kazakhstan in general but had not found a good project so far.

"We have always said that we are interested in non-ferrous metals - copper, zinc - in principle, so we do not rule out them. Although, of course, rare earths, in addition to diversification, have the advantage ... I am talking about electric cars."

Polymetal reported a 43% growth in third-quarter revenue to $656-million earlier on Thursday and raised its 2019 production forecast by up to 50 000 oz.

There was no reason to change the 2020 output estimate at this stage, Nesis said, as higher than expected gold content in ores at the Kyzyl mine in Kazakhstan, which caused the 2019 forecast upgrade, had already normalised.

Polymetal may recommend a special dividend if global gold prices remain around current levels until the end 2019.

"I did not expect gold prices to stay around $1 500 (per ounce) for so long. The longer it is at this level, the higher the probability of a special dividend is," the CEO said, adding that Polymetal's 2020 budget sees the gold price at $1 400/ounce.