Canadian company tries to defend assets in Kyrgyzstan

RUSSIA / FSU POLITICS - In Brief 21 May 2021 by Alex Teddy
On May 17 Centerra Gold launched an arbitration action at the Arbitration Insitute in Stockholm. Kutmor, which is a gold mine in Kyrgyzstan, is being sequestrated. The process is to be completed in August.Kutmor is the only project in the country run under a concession. The mine is Centerra's most valuable asset and is the major source of its gold. Kyrgyzaltyn owns 26% of Centerra's shares. Kutmor provides 10% of Kyrgyz GDP. In 2020 it paid USD 160 million in tax. That makes it the country's biggest taxpayer. The government claims that Centerra owes another USD 146 million in tax which Centerra disputes.The government has launched a civil lawsuit for pollution seeking compensation of USD 3 billion. Centerra said this is politically motivated nonsense in a bid to intimidate the company into ceding control of the mine.Centerra's stock price has fallen 30% due the row. On May 7 the Kyrgyz Parliament passed a bill for the mine to be nationalized.Kyrgyzaltyn has said it will sell 20% of its holdings in Centerra. President Japarov has been campaigning since 2013 for the state to seize the mine. Japarov spent 7 years in jail for inciting riots over the mine. Now Japarov says he does not wish to nationalize the mine but that is not credible.

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