Centerra Gold Inc. announced that it has brought additional claims against the government of the Kyrgyz Republic in binding arbitration and asserted claims against the state-owned entity Kyrgyzaltyn JSC in response to the wrongful expropriation of the Kumtor mine.
As company’s statement says, among other relief, the amended Notice of Arbitration seeks to hold the Kyrgyz government and Kyrgyzaltyn JSC responsible for any and all losses and damages that result from their coordinated campaign to seize the gold mine in violation of longstanding investment agreements and without compensation to Centerra.
The amended notice adds claims against Kyrgyzaltyn JSC, the gold refining monopoly in the Kyrgyz Republic and Centerra’s largest shareholder. It asserts that Kyrgyzaltyn JSC conspired with the Kyrgyz government to take control of the mine under the guise of temporary «external management» and continues to act at the behest of the government with regard to the operation of Kumtor and its shareholding in Centerra.
«Rather than honor its commitment to arbitrate any disputes in a transparent manner in a neutral forum, the government and those acting in concert with it have proceeded to expropriate the Kumtor Mine, placing Centerra’s investment and the livelihoods of thousands of Kyrgyz workers at risk. Centerra would much prefer to resolve this dispute in a constructive dialogue with the Kyrgyz authorities, but their repeated refusal to engage leaves us no choice but to seek effective remedies through arbitration and other legal means,» Scott Perry, President and Chief Executive Officer of Centerra, said.
As it was previously announced on May 16, 2021, Centerra initiated binding arbitration against the Kyrgyz government in response to actions taken against the Company’s wholly owned subsidiary Kumtor Gold Company (KGC), including meritless fines and tax claims as well as legislation providing for its operations to be placed under «external management.» The amended notice asserts additional claims arising from the seizure of the mine and seeks to enjoin the respondents from any further actions to nationalize the mine or transfer KGC’s assets.
Under applicable investment agreements, Centerra’s claims will be adjudicated by a single arbitrator in arbitration proceedings to be held in Stockholm, Sweden and conducted under the rules of the United Nations Commission on International Trade Law (UNCITRAL).
Centerra has requested that the Permanent Court of Arbitration in the Hague designate an appointing authority to select an arbitrator promptly.