Kyrgyz Parliament Passes Law on Glaciers
25 April 2014 - 7:20AM
Marketwired
Kyrgyz Parliament Passes Law on Glaciers
TORONTO, ONTARIO--(Marketwired - Apr 24, 2014) - Centerra Gold
Inc. (TSX:CG) announces that it understands that on Wednesday,
April 23, 2014 the Parliament of the Kyrgyz Republic passed a law
prohibiting activities which affect glaciers in the Kyrgyz Republic
(the "Glacier Law"). The Glacier Law must be signed by the
President of the Kyrgyz Republic before it will take effect.
Centerra has not yet received the official version of the
Glacier Law and notes that several of its provisions are unclear.
The Glacier Law also contains provisions for the payment of
compensation for damages to glaciers, at rates to be determined by
the Government. Nevertheless, Centerra believes that the
stabilization and non-discrimination provisions contained in the
agreements governing the Kumtor project (the "Kumtor Project
Agreements") and the law of the Kyrgyz Republic which implemented
the Kumtor Project Agreements support the view that the Glacier Law
would not apply to Kumtor mining operations. In addition, Centerra
believes that any disagreement in relation to the application of
the Glacier Law to Kumtor would be subject to the dispute
resolution (international arbitration) provisions of the Kumtor
Project Agreements.
Limited measures to manage glaciers and ice have been a feature
of mining operations at Kumtor from the beginning of the project in
1994 and have been the subject of frequent Kyrgyz regulatory
oversight and approval as well as review by international technical
and environmental experts, including experts retained by the
European Bank for Reconstruction and Development in connection with
the extension of a credit facility to Centerra. Such measures are
necessary to ensure that mine operations can be carried on safely
in the open pit. The continuation of mining at Kumtor depends on
Centerra's ability to carry on such activities throughout the life
of the mine.
In view of the strategic importance of the Kumtor project to the
Kyrgyz Republic, we believe that the Glacier Law is unlikely to be
enforced in a manner that would require the project to suspend
mining activities. We also note that in all our dealings with
successive governments of the Kyrgyz Republic, such governments
have consistently and emphatically stressed the strategic
importance of Kumtor to the Kyrgyz Republic and that mining
operations at the project continue uninterrupted, notwithstanding
any disagreements that may arise between Centerra and the
Government regarding the project. We also note that the President
of the Kyrgyz Republic has the discretion to reject the Glacier Law
and return it to Parliament for further consideration.
However, there can be no assurances that Kyrgyz regulatory
authorities will not enforce the Glacier Law, with the potential
for mine operations to be suspended or terminated, or that the
Government will not make substantial claims for damages for past or
future activities affecting glaciers. Any such enforcement action
or claims would have a material adverse impact on the Company's
operations, future cash flows, earnings, results of operations and
financial condition.
Cautionary Note Regarding Forward-looking Information
Information contained in this news release and the documents
referred to herein which are not statements of historical facts,
may be "forward-looking information" for the purposes of Canadian
securities laws. Such forward looking information involves risks,
uncertainties and other factors that could cause actual results,
performance, prospects and opportunities to differ materially from
those expressed or implied by such forward looking information. The
words "believe", "expect", "envision", "target", "intends",
"estimate", "may", "will", and similar expressions identify
forward-looking information. These forward-looking statements
relate to, among other things, the possible effect of the Glacier
Law on mining operations at Kumtor and the enforcement thereof by
relevant Kyrgyz Government authorities, the legal effect of the
Glacier Law given the provisions of the Kumtor Project Agreements
and the Kyrgyz law implementing those agreements, the need to
continue mining ice throughout the life of the Kumtor mine,
statements regarding the Company's plans to discuss outstanding
issues relating to the Kumtor project with the Kyrgyz Government
and the Company's understanding of the position of the Kyrgyz
Government on the importance of continuing mining operations at
Kumtor.
Forward-looking information is necessarily based upon a number
of estimates and assumptions that, while considered reasonable by
Centerra, are inherently subject to significant political,
business, economic and competitive uncertainties and contingencies.
There may be factors that cause results, assumptions, performance,
achievements, prospects or opportunities in future periods not to
be as anticipated, estimated or intended. These factors include
Kyrgyz Republic resource nationalism, the impact of changes in, or
to the more aggressive enforcement of, laws, regulations and
government practices in the Kyrgyz Republic, the impact of any
actions taken by the Kyrgyz Republic Government and Parliament as a
result of the Kyrgyz State Commission on Kumtor, the impact of the
enactment, changes to, or the increased enforcement of,
environmental laws and regulations relating to the Company's
operations, including the Glacier Law; risks relating to the
Company's ability to enforce its legal rights, risks associated
with having a significant shareholder, and possible director
conflicts of interest. See also "Risks that can affect our
business" in the Company's Annual Information Form for the year
ended December 31, 2013, available on SEDAR at www.sedar.com.
There can be no assurances that forward-looking information and
statements will prove to be accurate, as many factors and future
events, both known and unknown could cause actual results,
performance or achievements to vary or differ materially, from the
results, performance or achievements that are or may be expressed
or implied by such forward looking statements contained herein or
incorporated by reference. Accordingly, all such factors should be
considered carefully when making decisions with respect to
Centerra, and prospective investors should not place undue reliance
on forward-looking information. Forward looking information is as
of April 24, 2014. Centerra assumes no obligation to update or
revise forward-looking information to reflect changes in
assumptions, changes in circumstances or any other events affecting
such forward looking information, except as required by applicable
law.
About Centerra
Centerra Gold Inc. is a gold mining company focused on
operating, developing, exploring and acquiring gold properties
primarily in Asia, the former Soviet Union and other markets
worldwide. Centerra is the largest Western-based gold producer in
Central Asia. Centerra's shares trade on the Toronto Stock Exchange
(TSX) under the symbol CG. The Company is based in Toronto,
Ontario, Canada.
Additional information on Centerra is available on the Company's
web site at www.centerragold.com and at SEDAR at www.sedar.com.
Centerra Gold Inc.John W. PearsonVice President, Investor
Relations(416)
204-1241john.pearson@centerragold.comwww.centerragold.com
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