A Message to the People of the Kyrgyz Republic
Almost half a century ago, Soviet geologists found gold in a remote area of the Tian-Shan mountain range, almost 4,000 meters above sea level. For decades, developing a mine in such an inhospitable location was considered simply impossible.
Then, in 1994, after the Kyrgyz people gained independence and with your help, we began building the Kumtor Gold Mine with an initial life of 18 years. To this day, what we created together is something special that engineers from all over the world come to study.
Over this time, Centerra Gold has invested more than US$3.4 billion as we developed and operated a world-class facility to international environmental, safety and engineering standards and extended the life of the mine to more than 34 years. Under our management, the Kumtor Mine became the largest private employer in the Kyrgyz Republic, its biggest taxpayer and a critical contributor to the Kyrgyz economy and important social programs.
The seizure of the mine is based on false information and groundless allegations that undermine everything we have built together. We fear that the government’s unjustified action will put thousands of well-paying jobs and the businesses of hundreds of Kyrgyz suppliers at risk.
More importantly, the government’s conduct threatens the Kyrgyz economy – and the future of foreign investment in the country. Global investors want certainty. They want to know that a government will respect signed agreements and not change the rules without warning. Centerra Gold recently announced plans to invest an additional US$2 billion to extend the life of the Kumtor Mine once again. That is all on hold now because of what has happened.
We remain willing and available to engage in a constructive dialogue with the leadership of the Kyrgyz Republic. But to date, the authorities have repeatedly refused our attempts to open talks. We have always resolved differences in our relationship through negotiation and compromise. This time, we are concerned that the government is pursuing a premeditated effort to nationalize the Kumtor Mine or force Centerra Gold to give up ownership.
Our goal remains to find an acceptable resolution to this dispute. In the meantime, we are doing everything possible to preserve the value of the Kumtor Mine and protect Centerra Gold and its stakeholders from the government’s unnecessary actions.
We are proud of our long association with the Kyrgyz people. It has benefitted the country and our company, and we are disappointed that we cannot continue to invest in this beautiful land at this time.
President and Chief Executive Officer
Centerra Gold Inc.