Centerra Gold hit with $3.1 billion environmental fine by Kyrgyzstan court

Canada’s Centerra Gold has been handed a US$3.1 billion fine after a court in Kyrgyzstan ruled that its in-country subsidiary Kumtor Gold Company had violated environmental laws at the nation’s biggest gold mine.

Kumtor was found by the court to have breached environmental laws by placing waste rock on glaciers, just a day after Kyrgyzstan’s parliament passed a law allowing the state to temporarily take over a company if its activities pose a danger to human lives or the environment.

Centerra responded to its latest dispute in the central Asian country by calling the charges ‘entirely meritless’ and said it was also aware of ‘other draft laws and decrees’ which would undermine its 2009 restated project agreements and Kumtor’s tax and fiscal regime.

The TSX-listed firm reached a strategic agreement with the Kyrgyz government in 2019 to end long-running legal and environmental disputes over Kumtor, which Centerra said had released it of all outstanding claims at the time, including damages for alleged harm caused to the environment from storing production tails on glaciers.

However, the dispute has been revived since the appointment of President Sadyr Japarov at the start of the year. Japarov has strongly advocated for the nationalisation of the Kumtor Gold Mine in years gone by.

@RGNonline