Kyrgyzstan aborts plans to grab Centerra’s Kumtor mine, but wants more say

Kyrgyzstan aborts plans to grab Centerra’s Kumtor mine, but wants more say

Centerra Gold's Kumtor mine. (Image from archives)

Kyrgyzstan authorities said Friday the country has no intentions of nationalizing Centerra Gold's (TSX:CG) Kumtor mine, but added they do want more representation on the Canadian miner’s board.

A Parliament’s ruling coalition representative told local news agency 24, the government simply “does not trust” Centerra’s current management.

Kumtor, which lies near the Chinese border at an altitude of 4,000 metres, has been a source of political tension in the impoverished country.

For over two years the Central Asian nation and the Toronto-listed miner have been in talks on a deal to swap the government’s 32.7% stake in Centerra for half of a joint venture that would control the Kumtor gold mine.

But earlier this month the prime minister of the Kyrgyz Republic suggested a 50/50 joint venture with Centerra was not in the country's interests.

The vast open pit gold mine accounts for 60% of the nation's industrial output and, according to Centerra, it is expected to produce 470,000-520,000 ounces at a all-in sustaining cost between $819-$908 per ounce this year.