Centerra Gold Inc. (TSE:CG), the Canadian operator of the Kumtor mine in Kyrgyzstan, said it would mull taking the Central Asian country to arbitration if the company cannot reach an agreement with the government over the disputed asset, according to Reuters.
The Toronto-based company is under pressure from the Kyrgyz parliament, which demands the state own 67 percent in a proposed joint venture to run the Kumtor mine, which accounted for 12 percent of Kyrgyzstan's gross domestic product in 2011.
Talks have taken place amid riots and opposition calls to nationalize Kumtor, a major foreign-currency earner for the country.
Centerra is actively working with the Kyrgyz government to strike a deal, but would seek arbitration were neogtiations to fail, Chief Executive Ian Atkinson told Reuters during a visit to Moscow.
In September, the government and Centerra signed a memorandum of understanding, paving the way for Kyrgyzstan to swap its 32.7 percent stake in the Canadian firm for 50 percent in a venture that would own Kumtor.
But in October, the legislature voted to tear up the deal and seek control over the planned venture. It gave the cabinet until Dec. 23 to report on its talks with Centerra.
Kyrgyz President Almazbek Atambayev said today that the order to seek 67 percent for the state in the Kumtor venture was "obviously unachievable".
If Kyrgyzstan were to pull out from the current agreement, prompting legal action, the current 33-67 percent split in Centerra's favour would remain in place while any case is heard before the courts, Atambayev said.
Centerra has had no further production shutdowns in Kyrgyzstan since May, when it suspended work at Kumtor after villagers blocked the only road to the mine, Atkinson said, maintaining the firm's output forecast for 2013.
In July, Centerra Gold boosted its annual consolidated gold production outlook to a range of 615,000 to 675,000 ounces from its previous range of 605,000 to 660,000 ounces, compared with 387,076 ounces produced in 2012.
Centerra dived 4.6 percent to C$3.77 at 3:34 p.m. in Toronto, extending this year's losses to 60 percent. Reported by Proactive Investors 4 hours ago.
The Toronto-based company is under pressure from the Kyrgyz parliament, which demands the state own 67 percent in a proposed joint venture to run the Kumtor mine, which accounted for 12 percent of Kyrgyzstan's gross domestic product in 2011.
Talks have taken place amid riots and opposition calls to nationalize Kumtor, a major foreign-currency earner for the country.
Centerra is actively working with the Kyrgyz government to strike a deal, but would seek arbitration were neogtiations to fail, Chief Executive Ian Atkinson told Reuters during a visit to Moscow.
In September, the government and Centerra signed a memorandum of understanding, paving the way for Kyrgyzstan to swap its 32.7 percent stake in the Canadian firm for 50 percent in a venture that would own Kumtor.
But in October, the legislature voted to tear up the deal and seek control over the planned venture. It gave the cabinet until Dec. 23 to report on its talks with Centerra.
Kyrgyz President Almazbek Atambayev said today that the order to seek 67 percent for the state in the Kumtor venture was "obviously unachievable".
If Kyrgyzstan were to pull out from the current agreement, prompting legal action, the current 33-67 percent split in Centerra's favour would remain in place while any case is heard before the courts, Atambayev said.
Centerra has had no further production shutdowns in Kyrgyzstan since May, when it suspended work at Kumtor after villagers blocked the only road to the mine, Atkinson said, maintaining the firm's output forecast for 2013.
In July, Centerra Gold boosted its annual consolidated gold production outlook to a range of 615,000 to 675,000 ounces from its previous range of 605,000 to 660,000 ounces, compared with 387,076 ounces produced in 2012.
Centerra dived 4.6 percent to C$3.77 at 3:34 p.m. in Toronto, extending this year's losses to 60 percent. Reported by Proactive Investors 4 hours ago.