Ex-Prime Minister of Kyrgyzstan Mukhammedkaly Abylgaziev was arrested in Bishkek. One of the charges brought against him by the State Committee for National Security is that he, allegedly, allocated additional areas for exploration and gold mining to Kumtor mine, increasing it «almost twice to 26,300 hectares».
Kumtor Gold Company CJSC (KGC) commented on the situation to 24.kg news agency. In particular, it was reported that «the Kumtor’s licensed area of 266.6 square kilometers (or 26,660 hectares) is determined by the license obtained in 1997 for the right to use subsoil for the purpose of geological exploration and the signed license agreement.» This license was extended in 2005.
Based on the agreement on new conditions for Kumtor project dated April 24, 2009 and revised project agreements dated June 6, 2009 (ratified by the law dated April 30, 2009), the Kumtor concession area reached 26,400 hectares. The difference between the size of the licensed and concession areas is due to the change in the coordinate system and the calculation method.
The Kumtor concession area does not include any additional areas other than the aforementioned licensed area.
Kumtor Gold Company
«The revised concession agreement was concluded between the government of Kyrgyzstan and Kumtor Gold Company CJSC on June 6, 2009. It was concluded within the framework of execution of the agreement on new conditions for Kumtor project dated April 24, 2009.
This agreement was ratified by the Parliament. It provided for a number of rights, obligations and privileges for the parties. In particular, the concession area (26,400.8 hectares), the receipt of 43,532,615 common shares of Centerra Gold Inc. by Kyrgyzaltyn OJSC, which increased the share by 43.8 percent — from 33,869,151 shares to 77,401,766 shares, was stipulated.
The market value of Centerra’s shares held by Kyrgyzstan is over $ 834 million.
In addition, under the agreement, Kumtor Gold Company paid out over $ 22 million to the Kyrgyz government.
«Now KGC uses a land plot with an area of 26,400.8 hectares on the basis of a valid certificate for the right of temporary use of the land plot for the period until December 4, 2042. It was issued on a general basis within the framework of the current land legislation,» the company said.
«It is important to stress that all geological exploration is currently taking place at the boundaries of the central section of the pit — mainly in the area called ‘Hockey Stick’ and in SB zone deep extension in order to add to the open pit mine life. The task of exploration drilling is to detect mineralization zones located near the surface, search for additional resources on the northeastern side of the Central pit, in the corridor between the Central and Southwest pits, on the flanks of Sarytor target area,» Kumtor Gold Company CJSC said.
