decline in stocks at the mine "Kumtor" at 21% April 1, the regular meeting of the Advisory Council on the negotiations with the company "Centerra Gold Inc." to restructure the project "Kumtor". It is reported by the department of information support of the government staff.
The expert group of "Kyrgyzaltyn" informed of the outcome of negotiations and consultations with the delegation of "Centerra Gold Inc.", which took place from 23 to 30 March this year in Bishkek, as well as the content of the revised plan of the mine "Kumtor", published March 20, 2015 at the official website of the company "Centerra".
In accordance with the revised plan "Centerra" declares the decline in stocks at the mine "Kumtor" at 21%, which in turn will lead to a decrease in production and a decrease in the overall financial flows generated by the project "Kumtor" in the future.
In addition, the increased risks associated with the need to ensure the sustainability of the pit walls and localization of glacier mass movement, which consequently may result in increased costs and production costs.
As a result, in the case of a joint venture (with shares of the parties 50% to 50%), previously projected financial flows in the form of dividends to the Kyrgyz side is significantly reduced.
Thus, there has been a material adverse change in the input data and the conditions under which the ROC government began negotiations with the company "Centerra Gold Inc." in 2013 and on the basis of which an agreement was reached on the terms of the restructuring of the project "Kumtor" from January 18, 2014.
The Advisory Council notes that the adoption and publication of a revised plan of the mine "Kumtor" was an unpleasant surprise, as previously part of the company "Centerra Gold Inc." This question is not made public.
Following the meeting of the advisory board concluded that the financial and economic parameters of an agreement on the terms of the restructuring of the project "Kumtor" from January 18, 2014 under the present conditions and in the framework of the revised plan of the mine "Kumtor" differ substantially from those previously anticipated benefits from the restructuring of the Kyrgyz Republic project "Kumtor".
State Agency on Geology and Mineral Resources of the Government of the Kyrgyz Republic entrusted to carry out a detailed analysis of settlements JSC "Kumtor Gold Company", based on which the company "Centerra Gold Inc." announced reduction of reserves on deposit "Kumtor".