Centerra confirms talks with Kyrgyzstan for out-of-court settlement over mine dispute

·1 min read
A worker stands on the bank of the lake near Petrov glacier, main water source for the Kumtor open pit gold mine, in Tien Shan mountains

(Reuters) -Canada's Centerra Gold on Monday confirmed it was in talks with the Kyrgyzstan government for an out-of-court settlement over a dispute in which the state seized the company's Kumtor mine.

In May 2021, Centerra kicked off arbitration against the former Soviet republic after it took over the country's biggest mine for allegedly posing danger to human lives or the environment. The company has denied all the allegations.

The company also froze the government's stake when it seized the mine, meaning it does not have voting rights, nor is it entitled to dividends.

Centerra on Monday laid out a framework for any resolution of the dispute, saying it should receive around 26.1% of its common stock held by state-owned Kyrgyzaltyn JSC.

It also said the state should assume all responsibility for the company's two Kyrgyz subsidiaries as well as the Kumtor mine.

"At present, the parties are finalizing the discussion of an amicable agreement, including, among other things, the condition for the full transfer of the Kumtor Gold Company to the Kyrgyz Republic," Kyrgyzstan President Sadyr Zhaparov said in a statement dated Jan. 2.

In December, a source close to the government told Reuters that Kyrgyzstan was pushing for an out-of-court settlement over the dispute.

Centerra and Kyrgyzstan have a long history of disputes over how to share profit from the 550,000-ounce gold mine.

(Reporting by Rithika Krishna in Bengaluru; Editing by Ramakrishnan M.)

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting