The Governments thoughts on Kumtor, and where they might be...

The Governments thoughts on Kumtor, and where they might be heading

This statement was made today, 24 January, Prime Minister of the Kyrgyz Republic Jantoro Satybaldiev at the next Cabinet meeting.

The first item on the agenda was listed discussion of the final report of the "State Commission for the Monitoring of compliance and investigation of CJSC" Kumtor "standards and requirements for the management of natural resources, environmental protection, process safety and social protection of the population", formed by the Government of the Kyrgyz Republic July 3, 2012.

Prime Minister Jantoro Satybaldiev stressed that created all the necessary conditions for a comprehensive, complete, objective and open work of the State Commission.

"Our government is interested in further work" Kumtor ". Gold mining in the field "Kumtor" should be strictly within the laws of Kyrgyzstan. Talk of nationalization is not mine, "- said Zh.Satybaldiev, adding that members of the committee worked with the management of JSC" Kumtor Gold Company "and JSC" Kumtor ".

Note that in the report of the State Commission reflected the economic losses from previously signed agreements on the project "Kumtor", questions about the omissions of mine technical field, the impact of the work carried out in the field on the environment, as well as the losses from poor management by the project.

The outcome of the commission said the Minister of Economy of the Kyrgyz Republic, the head of the State Commission Sariev.

He said that for more than 21 years, that is, since the country gained independence Jogorku Kenesh and the Government has set up 17 committees "Kumtor". "In contrast to the previously created a commission to work acting commission, none of the country's leadership did not intervene and no pressure. Committee consisting of 25 members, held its work openly, honestly and fairly, "- said Sariev.

According to the minister, the development of the Kumtor gold deposit was made in gross violation of the domestic law. In particular, the work was carried out without making a feasibility study without examination and tender. One of the most flagrant violations is that the Kumtor project was given to the company "Cameco", which does not specialize in gold mining. Therefore, tailing, factories and other facilities have been built in the places where the construction of such facilities is not permitted.

The initial capital investment was valued at € 275 million. However, this amount was increased by another 176 million U.S. dollars. As a result, at the Kumtor mill was built for 451 million U.S. dollars. The company "Cameco" made for capital expenditures only 4.3% of that amount. But it is the third part of the shares owned. All these flagrant violations of the law were carried out with the tacit consent and permission of the then senior officials. In addition, the mining company to take maximum advantage from 1997 to 2009, the announced tax holidays.

In 2011, profit «Centera Gold Inc» from gold mining in the field "Kumtor" was 460 million U.S. dollars. In this case, for damages ecology was paid only 310 thousand U.S. dollars. According to independent experts with a profit for the environment was to be paid at least 10 million U.S. dollars.

Gold reserves of the mine "Kumtor" according to the latest estimated more than 900 tons. Of them, from 1997 to the present time, the field produced 260 tons of gold.

As the report made by the Minister of Justice of the Kyrgyz Republic Almambet Shykmamatov, chairman of the State Inspectorate for economic and technical safety in RCC Osmonbek Artykbaev.

According O.Artykbaeva revealed numerous violations. He noted that the management of gold-mining company brought fines from 1997 to the present, the amount of 6 billion 806 million soms.

Also, according to him, the need to build a new water treatment plants and tailings.

State Commission report recommends that the Government of the Kyrgyz Republic as follows:

- To hold talks with the company «Centera Gold Inc» of termination agreements in 2009 for the project "Kumtor";

- New agreements in accordance with the legislation of the Kyrgyz Republic in the interests of the Kyrgyz side;

- To address the issue of fair compensation for the extension of the concession area, according to the package of agreements in 2009 for the project "Kumtor" provides for payment of compensation for land acquisition land owner;

- The establishment of categories of streams prone technogenic effects of economic entities, in order to assess their contamination throughout the Kyrgyz Republic;

- To address the issue of payment of CJSC "Kumtor Gold Company" for the use of water from Lake Petrov;

- That appropriate allocations due to errors in the calculation of the amount of payment for emissions and waste disposal (the change of the coefficients).

In case of failure the Government of the Kyrgyz Republic is recommended:

- To initiate the procedure of annulment of the Law "On Ratification of the new conditions, to initiate the procedure on the Invalidation of laws on introducing amendments to the Tax Code of the Kyrgyz Republic" dated April 30, 2009 ? 143, dated May 29, 2009 ? 175;

- Terminate the revised investment agreement dated June 6, 2009;

- Terminate the revised concession agreement dated June 6, 2009;

- Terminate the other agreements concluded within the framework of the project "Kumtor";

In order to implement the recommendations of the State Committee members of the Government have adopted a government resolution CD with the suggestions. Also in this decision included an item to consider those responsible, including drafts opinions to the documents signed an agreement with the leadership of gold mining companies.

Also according to the decision of the Government of the Kyrgyz Republic, a working group to negotiate with the management «Centera Gold Inc».