Canadian court arrests over 60% of Kyrgyzstan’s shares in Centerra Gold

BISHKEK (TCA) - Canada-based Stans Energy Corp. announced on October 14 that it had obtained an order from the Ontario Superior Court of Justice which prohibits the Kyrgyz Republic and the country's state gold company Kyrgyzaltyn JSC from selling and transferring 47,000,000 shares in the capital of Centerra Gold Inc.

Stans Energy would like to use the shares as compensation for the loss of Kutessay II rare earth mine in Kyrgyzstan.

The court order was obtained in a proceeding by Stans Energy for recognition and enforcement of an international arbitration award of the Arbitration Court at the Moscow Chamber of Commerce & Industry against the Kyrgyz Republic for US $118 million. The Kyrgyz Republic has refused or failed to pay the award. 

Stans Energy Corp. is a resource development company focused on advancing Heavy Rare Earth (HRE) properties in areas of Central Asia and Russia. In December 2009, Stans acquired a 20-year mining license for the past-producing Kutessay II rare earth mine from the Kyrgyz Republic. On May 26, 2011 Stans completed the purchase of the Kashka Rare Earth Processing Plant (KRP) the same plant that previously refined REEs from Kutessay II ores. 

The Kyrgyz Republic revoked that license in 2012 at the request of the political faction of Ar-Namys of the Kyrgyz parliament. This prompted Stans Energy to commence international arbitration against the Kyrgyz government to reclaim its mining license. 

On October 6 Stans Energy said that the Kyrgyz Republic filed a motion to the Moscow Arbitration Court to have the judgment of the Arbitration Court at the Moscow Chamber of Commerce and Industry to be set aside. But the Court ruled to refuse the Kyrgyz Republic motion.

Kyrgyzstan's First Deputy Prime Minister Taiyrbek Sarpashev yesterday told the KyrTAG news agency that the Kyrgyz Government will hold consultations concerning the arrest of Kyrgyzstan's shares in Centerra. The issue of appealing the Canadian court's decision will be decided after the consultations.

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