Vaguely similar circumstances, but not the same Hi fellow NAK longs,
The info below seems to say there are other paths available if the obvious path gets even more bogged down The Best of worlds to all.
From John Tumazos on other mines and other circumstances.
We are fascinated at the legal situation and potential expropriation remedies for the Kumtor mine of Centerra Gold in Kyrgyzstan. We recall in 2012 Eurasian Resources agreed to pay First Quantum US $1.25 billion for its DRC copper assets after expropriation, which may have been better than operating copper mines at 2013-17trough prices. We observe that Antofagasta PLC and Barrick Gold won a $6 billion arbitration award in 2019 for the expropriation of the 6 billion tonne Reko Diq copper-gold large deposit in Baluchistan in Pakistan, but have not collected.
We estimate a reasonable four-pronged strategy may preserve at least ½ of the value of the Kumtor mine’s roughly 5 mm recoverable and 6.3 mm oz of reported year-end 2020 gold reserves, including (1) an immediate auction process to target proceeds of about ½ of fair value or our estimate of US $2.0-$2.5 billion or about $7/share, (2) a “takings” claim in international courts to recover the other ½ of fair value on the basis of the May 6, 2021 law and other acts as “de facto” expropriation and value destruction causing a panic in financial markets, (3) bothan injunction in Ontario courts and a special shareholders meeting to cancel the 77.4 mm shares or 26.2% of CGAU held by the Kyrgyzstan state and (4) both an injunction in Ontario courts and a special shareholders meeting to remove the Kyrgyzstan representatives from the Centerra Board as the states agents when the state attacks shareholder value.
Centerra Gold is a totally speculative stock as its major asset is subject to expropriation in a unique mix of circumstances with no precedent. The state has not seized the asset, but threatens and harasses CGAU in a manner that destroyed the asset’s value in financial markets. Today CGAU operates haul trucks, grinding mills, floatation and produces gold to enjoy cash flows as it ponders various extortions, threats, new laws, unfounded claims and harassment that caused its shares to assign nil value to Kyrgyzstan. Further, the state owns 77.4 mm shares and holds 3 of the 11 Board seats. The clams have no merit and the situation is unprecedented.
Faithfully,
John C. Tumazos, CFA
John Tumazos Very Independent Research, LLC
11 Yellow Brook Road