Gazprombank, the third-largest bank in Russia and a target of Western sanctions, has sent a notice demanding immediate repayment of about $201m from Russian gold miner Petropavlovsk.

In addition to the immediate repayment, Gazprombank also provided notice to return about $87.1m due under the group’s Russian units’ revolving credit facilities by 26 April.

The notice sent on Wednesday represents another setback for the miner, one of the biggest gold producers listed on the London Stock Exchange. Since the invasion of Ukraine by Russia, its shares have fallen by nearly half of their value, with the group now worth less than £100m.

For sale

The group’s principal assets are four hard-rock gold mines in the Amur region, in the Russian far east. As a result, the majority of the group’s cash reserves are held in Russia, limiting the groups’ ability to transfer the cash-out.

In addition, Petropavlovsk has substantial commercial and financial relationships with Gazprombank. The bank acts as an off-taker of the group’s entire gold production, but due to sanctions, the miner has been prohibited from any payment to the lender.

Consequently, last week, the company stated that it had begun to consider putting itself up for sale due to the challenges in paying off the $304m loan by November.