Gold Mines in Kyrgystan

I have just been passed an interesting article that shares some interesting news from Kyrgyzstan and which may also have implications for Kentor Gold’s Andash Project. On Wednesday Kyrgyzstan launched its second foreign-run gold mine at the Ishtamberdy deposit in the southern Kyrgyz region of Jalalabad. The mine is owned by a Chinese company call Full Gold Mining and will commence production by the end of the year before ramping up to 300,00 tpa by 2012.

Now why is this significant to Kentor Gold? Well the project was only able to proceed after the company met with protestors and overcame local opposition, a scenario which is very similar to what Kentor is facing with Andash. The article goes on to state that Full Gold was able to overcome the conflict with residents of the nearby village of Terek-Sai by paving the road linking local settlements (in conjunction with several other local businesses). It is only natural for everyone to want their piece of the pie so to speak and it appears as through the locals wanted to get something other than jobs out of the project befor allowing it to proceed.

I won’t speculate on what may or may not happen at Andash, but perhaps we will see similar local development plan enacted by Kentor Gold.

The other important issues the article picks up on is how vitally important gold mining is to the country. For example the Kumtor Gold Mine, owned by Toronto listed Centerra Gold contribute 9.4% of the GDP and nearly half of Kyrgyzstan’s industrial output last year. Clearly this underscores the importance to the local economy and any progressive government will want to support foreign investment into the industry.

Finally I keep an eye on the Kyrgyzstan political situation and next month will be very important for Kentor Gold and the future of mining in the country as local elections are scheduled to take place on October 31. The current Prime Minister Almazbek Atambaev is considered to be one of the favourites to be elected to the position of President and from what I understand this would be a positive outcome for the country and possibly the local mining industry.