Canadian miner Centerra Gold grants Kyrgyzstan control of the "toxic" Kumtor mine.
After signing an ownership transfer contract with the mine's former owner, Canadian miner Centerra Gold, Kyrgyzstan has reclaimed possession of the Kumtor gold mine, according to reports in the media on Saturday.
One of the greatest gold mines in Central Asia, Kumtor was once one of Kyrgyzstan's most significant international investment ventures. The mine, however, was brought to light last year when claims of risks to the area's ecosystem surfaced. Kyrgyzstan thereupon started a legal struggle to take back the site from the Canadian company.
At the Kyrgyzstan embassy in the UK, the exchange of paperwork attesting to the transfer process took place.
According to a press release from the office of the Kyrgyz president, "all necessary deeds of transfer, powers of attorney, and certificates for the registration of a full transfer of ownership of 100 percent of shares of Kumtor Gold Company and Kumtor Operating Company in favor of [state-owned miner] Kyrgyzaltyn were given to the ambassador of Kyrgyzstan in the UK Ulan Djusupov on July 29, 2022."
Kyrgyzstan will have complete legal control over the mine and any gold produced there starting on May 15, 2021, according to the deal. Additionally, it is entitled to $11 million in dividends from Centerra Gold, a $50 million lump sum payment, and roughly $53 million from the Kumtor mine reclamation fund. In return, Kyrgyzaltyn would forfeit its 26 percent ownership in Centerra Gold and cancel its 77.4 million common shares in the Canadian miner, which are valued at about $972 million.
Since 2009, Centerra Gold has owned and run the mine via its subsidiary Kumtor Gold under a contract with the government. However, the Kyrgyz government took control of the mine in May 2021, claiming issues with safety and the environment in addition to its assertion that the firm had underpaid taxes. Centerra Gold refuted these claims, denounced the action as state appropriation, and commenced an international arbitration proceeding to contest Kyrgyzstan's conduct. However, the corporation declared in April that it had decided to liquidate its corporate holdings in Kyrgyzstan and leave the nation.