BISHKEK (TCA) — The European Bank for Reconstruction and Development (EBRD) is extending a US $75 million loan for the development of Canada-based Centerra Gold Inc’s Öksüt open-pit gold mine in the central Turkish region of Kayseri. It is part of an existing US $150 million project financing facility with UniCredit, the EBRD Press Office said.
The $220 million greenfield project is being developed by Öksüt Madencilik Sanayi ve Ticaret A.S. (OMAS), a wholly-owned Turkish subsidiary of the international gold mining company Centerra Gold Inc.
This joint financing provided by the EBRD and UniCredit will be used for the construction, development and operation of the mine to the highest international standards.
Riccardo Puliti, Managing Director for Energy and Natural Resources at the EBRD, said: “We are pleased to support the entrance in the Turkish market of an experienced operator like Centerra. The overall aim of this operation is to create sustainable development in the mining sector while enhancing social inclusion and transparency.”
Centerra, a supporter of the Extractive Industries Transparency Initiative (EITI), is committed to operating in line with Publish What You Pay principles which require extractive industry companies to disclose what they pay to governments to extract natural resources.
With the EBRD’s help, Centerra will also explore ways to offer greater opportunities to female employees and women-led suppliers in Turkey. The mine is expected to create approximately 250 local jobs in addition to contractors.
Turkey is the largest gold producer in Europe and in the Mediterranean.
Scott Perry, Chief Executive Officer of Centerra Gold Inc. added: “We are pleased to have, in addition to UniCredit, the EBRD as a strategic partner and have them enter the Öksüt financing facility. Centerra has a long standing relationship with the EBRD dating back to the company’s initial public offering with the EBRD providing support and financing. We value our ongoing relationship and are grateful for the Bank’s commitment and support to help finance development in the regions where we both operate.”
Centerra is also developing Kumtor, the largest gold mine project in Kyrgyzstan. The company has been involved in a continuing standoff with the Kyrgyz government over the ownership of the project. A 2003 deal between Centerra and Kyrgyzstan gave the Kyrgyz government a 17 percent stake ownership in the Kumtor project, with Centerra controlling the rest. The agreement was renegotiated in 2009, giving the Kyrgyz government a nearly 33 percent stake. Later on, the Kyrgyz side has been insisting on a 50-50 split in ownership.
Kyrgyzstan President Almazbek Atambayev in June ordered the General Prosecutor’s Office to renew the investigation into the legality of the 2003-2004 and 2009 agreements governing the Kumtor project.
