Chaarat Gold Holdings Ltd (AIM:CGH) said it welcomed the resolution of a dispute between Centerra Gold Inc and the Kyrgyz government regarding the Canadian company’s Kumtor mine.
AIM-traded Chaarat warned in February that the situation around the Kumtor mine had pushed back the debt financing timeline for its Tulkubash project into the second half of this year.
"The agreement on the Kumtor dispute is a positive development and we are confident that a resolution will be beneficial for overall investor sentiment in the region,” said Chaarat chief executive Mike Fraser.
“As we understand from several financing parties, this was one of the key preconditions for financing, and we are looking forward to reengaging with potential financial partners on our Tulkubash project.
“We believe that investments such as ours and the strong commitment by the Kyrgyz government towards international investors will attract further investment to the country. In addition, this will also allow Chaarat to accelerate development of its Kyzyltash deposit which remains the company's main strategic objective in Kyrgyzstan," said Fraser.
Centerra announced yesterday that Kyrgyzstan will take full control of the Kumtor gold mine for an initial US$36mln (£27mln) payment in cash following an out-of-court settlement that will also see the government give up its 26% shareholding in the gold producer worth about C$972mln (£593mln). The agreement puts an end to the legal proceedings which started after Kyrgyzstan seized the mine in May 2021.