LBMA suspends Kyrgyz gold refinery over responsible sourcing failures

Image courtesy of Centerra Gold.

The London Bullion Market Association (LBMA) said on Friday it had suspended its accreditation of a gold refinery in Kyrgyzstan for failing to meet its responsible sourcing standards.

The LBMA said in June it had begun a review of the refiner, Kyrgyzaltyn JSC, “in response to issues concerning delivery and the potential for fraud.”

It gave no further details in that statement or on Friday.

Kyrgyzaltyn is embroiled in a dispute with Canadian miner Centerra Gold, whose Kumtor gold mine was seized by the Kyrgyz government in May.

Centerra has accused Kyrgyzaltyn, which is state-owned and is Centerra’s largest shareholder, of involvement in the seizure and said it tried to make fraudulent payments.

Kyrgyzaltyn has denied wrongdoing. The company did not immediately respond to a request for comment sent outside business hours.

The loss of accreditation will restrict Kyrgyzaltyn’s access to the mainstream market because major banks that dominate precious metals trading tend to handle only metal from refineries on the LBMA’s “good delivery” list.

“With effect from today, 17 September 2021, Kyrgyzaltyn JSC has been suspended from the LBMA Good Delivery List for failing to meet the requirements of the Responsible Sourcing Programme,” the LBMA said in a statement.

“All production from the refinery will no longer be accepted as Good Delivery from this date,” it said.

(By Peter Hobson; Editing by Louise Heavens and David Evans)


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