Toronto’s Centerra Gold says Kyrgyz arms file bankruptcy as Government seizes assets

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Toronto’s Centerra Gold says Kyrgyz arms file bankruptcy as Government seizes assets

Centerra Gold Inc., the Toronto-based mining company operating gold mines in Kyrgyz republic, copper-gold mine in British Columbia alongside Canada and Oksut gold mine in Turkey, said in a statement earlier this week that the mining giant’s Kyrgyz units, Kumtor Gold Co alongside Kumtor Operating Co, filed for Chapter 11 bankruptcy protection in a US court after the former Soviet Republic state had nationalized Centerra’s Kumtor gold mine.

In point of fact, latest move from Centerra Gold Inc came forth as Kyrgyz lawmakers had passed a law earlier in May, which in effect had provided the country’s Government with a tyrannical power to temporarily seize Centerra’s gold mines and employ additional management board in a bid to address environmental and safety problems, prodding the Toronto-based miner to seek justice in an international court.

Before the Kyrgyz Government had seized Centerra mines, the Canadian miner had been the largest foreign investor in the country under a project called Kumtor.

Centerra Gold Inc files bankruptcy protection for Kyrgyz arms

Centerra, in tandem, was quoted saying in a statement that the Chapter 11 bankruptcy filing in a US court, would not have any material impact on its revenues and operations including the Oksut mine in Turkey, Mount Milligan in Canada alongside its North American molybdenum business.

Apart from that, while being asked over the issue, the Kyrgyz Government had declined to comment. Nevertheless, Centerra added in a statement that the bankruptcy proceedings would bar Kyrgyz Government to curette Kumtor gold assets, however, should the Kyrgyz Government strip off Kumtor gold assets, the country could be held responsible for violating investment agreements which it had stamped with Centerra back in 2004, when the Kyrgyz Government had transferred its 33 per cent stake in Kumtor operations to the Canadian miner.