Centerra Gold confirms negotiations with Kyrgyz govt over Kumtor mine
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(Kitco News) - Centerra Gold (TSX: CG) today confirmed that it is engaged in negotiations with representatives of the Kyrgyz Republic to resolve their disputes related to Centerra's Kumtor Mine and the seizure of control of the mine by the Kyrgyz government in May 2021.
Further to statements in the Kyrgyz media regarding the potential negotiated transfer of the Kumtor Mine to the Kyrgyz Republic, Centerra said it expects that the framework for any resolution would involve the following principal terms:
- Centerra receiving the approximately 26.1% in Centerra common shares held by Kyrgyzaltyn JSC (an instrumentality of the Kyrgyz Republic). Upon receipt, Centerra would cancel the shares surrendered by Kyrgyzaltyn JSC.
- The Kyrgyz Republic receiving, and assuming all responsibility for, the company's two Kyrgyz subsidiaries and the Kumtor Mine.
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- Payment by Centerra of a cash amount equal to the net amount of the three dividends paid by Centerra in 2021 that Kyrgyzaltyn JSC did not receive as a result of the seizure of the mine and certain other financial consideration associated with the settlement of inter-company balances between Centerra and its two Kyrgyz subsidiaries.
- The resignation from Centerra's Board of Directors of Kyrgyzaltyn JSC's two nominees.
Importantly, the company added that the parties are negotiating full and final releases of all claims of the parties and termination of all legal proceedings involving the parties in all jurisdictions with no admissions of liability.
"Negotiations with representatives of the Kyrgyz Republic are ongoing, and there can be no assurance that any proposed resolution will be consummated or as to the final economic and other terms and conditions of any such resolution, if agreed," the company said in a statement.
Centerra Gold is a Canadian-based gold mining company focused on operating, developing, exploring and acquiring gold properties in North America, Turkey and other markets worldwide.