Kyrgyzstan in no gold rush, pulls out of talks with Canada's Centerra

GMT 08:11 2015 Wednesday ,23 December

Arab Today, arab today Kyrgyzstan in no gold rush, pulls out of talks with Canada's Centerra

A general view of the Kumtor gold mine in the Tien Shan Mountains
Bishkek - AFP

Kyrgyzstan pulled out of talks Tuesday with Canadian mining company Centerra, the Central Asian country's biggest taxpayer, leaving the future of a key gold mine in limbo just days before its permits expire.

The government, which is under public pressure to nationalise the Kumtor gold mine, said it would no longer participate in negotiations over a proposed 50-50 ownership plan but was prepared to offer a "new option for restructuring the project".

Centerra, which is listed on the Toronto stock exchange, had "presented a series of conditions for the registration and governance of the joint venture that were absolutely unacceptable to" Kyrgyzstan, a government statement said.

Kyrgyzstan holds a 32.7 percent stake in Centerra, and had been trying to swap that for a 50 percent stake in the Kumtor mine, which accounts for up to 10 percent of the nation's economic output.

The Kyrgyz government has yet to extend the permits to allow mining at the site to continue next year, although Centerra officials say they are confident the paperwork will be issued.

Top Kyrgyz officials including President Almazbek Atambayev have issued mixed signals on the future of the mine, which has been the subject of violent protests demanding its nationalisation.

Prospects of reaching a deal have been complicated by the freezing of Kyrgyzstan's shares in Centerra by Canadian courts following international arbitration rulings in favour of foreign investors.

Kyrgyzstan's shares in Centerra are the country's most significant foreign asset, making their seizure attractive as payment for arbitration awards.


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