Tag Archives: gold

Anglo Asian shares soar after trading update

OCT. 3 (The Conway Bulletin) – London-listed gold miner Anglo Asian Mining said gold output had risen by 47% in July-Sept. compared to 2017, immediately pushing up its share price by 12% to an all-time high of 74.5p.

The announcement followed a dividend for shareholders for the first time in September and guidance that gold output would be at the higher end of expectations. Since the start of September, Anglo Asian’s share price has risen by 76%.

CEO Reza Vaziri said: “Given the strong production in the year so far, I am expecting production for the full year to be at the upper end of our guidance.”

Anglo Asian’s operations are focused in Azerbaijan. In Q3 2018, it produced 21,318 ounces of gold compared to 14,684 ounces in Q3 2017.

Anglo Asian has been able to exploit its main Gedabek mine more quickly than anticipated and it also announced an increase in reserves at the mine.

ENDS

>>This story was first published in issue 388 of The Conway Bulletin on Oct. 17 2018

US criticises Armenia for delays to opening of gold mine

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YEREVAN/ Oct. 16 (The Conway Bulletin) — The outgoing US ambassador in Armenia, Richard Mills, said he was increasingly concerned about the amount of time it was taking for the authorities to allow the Amuslar gold mine, owned by Colorado-based Lydian, to start operating.

This rare criticism by a US ambassador highlights the frustration building up at Lydian and its supporters over what they see as political meddling. In an interview with the EVN Report, Mr Mills said that delays at Amuslar, which has been accused of breaking environmental regulations and of corruption, was damaging Armenia’s investment climate.

“I’m not aware that they have violated environmental norms,” he said. “It does create an investment concern and that’s not a threat.”

The Amuslar mine was given approval in 2016 and was due to start producing gold this year although this is now considered unlikely. This year protesters have blocked roads leading to the mine and in August, prosecutors launched a minor criminal case against Lydian Armenia. The environmental agency has also forced the mine to halt production to investigate discoveries of ‘Red List’ animals and plants.

Lydian International has denied any wrongdoing and has said that allegations are designed to either stop the project altogether or to generate payments. The European Bank for Reconstruction and Development (EBRD) is a shareholder in Lydian.

ENDS

>>This story was first published in issue 388 of The Conway Bulletin on Oct. 17 2018

Centerra Gold and Kyrgyzstan agree deal to end Kumtor dispute

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BISHKEK/SEPT. 12 2017 (The Conway Bulletin) — Kyrgyzstan and Toronto-listed Centerra Gold said they had agreed a deal to end their dispute over ownership of the Kumtor gold mine in the east of the country.

The news propelled Centerra Gold’s shares to a 4-1/2 year high on the Toronto stock exchange. It will also give Kyrgyzstan’s ruling Social Democratic party a boost ahead of next month’s presidential election.

Under the deal, Centerra Gold will retain its 100% ownership of Kumtor in exchange for a one-off $50m payment to a new environmental protection agency. It will also pay the agency $3m every year and make another one-off payment of $10m to a cancer centre. Centerra Gold will also pay $6m a year into Kumtor’s reclamation fund, up to a total of $69m.

The Kyrgyz state owns 26.6% of Centerra Gold.

After signing the deal, Kyrgyz PM Sapar Isakov said: “This will be the basis for restarting our relations based on mutual trust and joint efforts to further effectively implement the project in the interests of the people of Kyrgyzstan and all the shareholders of Centerra Gold.”

Kumtor is Centerra Gold’s most important asset and also the biggest industrial site in Kyrgyzstan. It produces 10% of Kyrgyzstan’s total GDP.

As well as suppressing Centerra Gold’s share price, the row has damaged Kyrgyzstan’s reputation as a place to do business.

Western analysts have accused Kyrgyz officials of trying to make life difficult for Centerra Gold by denying key workers permits, launching claims for environmental damage and chasing back tax payments.

Centerra Gold retaliated last year by taking the dispute to an international arbitration court.
This action will now be dropped.

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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017

Armenian Lydian secures more support

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JULY 4 2017 (The Bulletin) — Armenian gold miner Lydian said that it had secured another $25m loan from the Orion and Resource Capital funds, specialist mining creditors, to help pay for the construction of its operations at its Amsular site in the south of the country. Earlier this year it also secured a $50m loan for funding on the same project from ING Bank. Armenia has been looking to boost mining projects.

ENDS

(News report from Issue No. 336, published on July 16 2017)

EBRD loans gold project in Kazakhstan

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JUNE 22 2017 (The Bulletin) — The EBRD agreed a loan of $140m for Bakyrchik Mining Venture, a subsidiary of London-listed Polymetal International, to develop the Kyzyl gold deposit in Kazakhstan. The EBRD said that the loan would create 400 jobs and ensure good governance over the project. Previous mining projects in Kazakhstan have been plagued by governance issues.

ENDS

(News report from Issue No. 334, published on June 26 2017)

Stock market: Georgia Healthcare, KAZ minerals

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JUNE 19 2017 (The Bulletin) — It was a poor week for stocks in companies linked to Central Asia and the South Caucasus. All stocks were either stagnant or fell, with the notably exception of Georgia Healthcare, which is perhaps the standout performer of the year.

By the end of the week, Georgia Healthcare stock had risen by 12% to 394.5p, smashing past its previous all-time high of 373p hit in February.

As for the fallers, the heaviest tumbles were taken by KAZ Minerals and Centerra Gold. KAZ Minerals, the Kazakhstan focused copper producer, fell 11.4% to 471.5p. This, although it looks bad, was merely a correction to return to trading at a level it has been anchored around for the past month.

Centerra Gold’s shares are volatile. The Canada-based miner whose main asset is the Kumtor gold mine in eastern Kyrgyzstan is locked in a near permanent dogfight with the Kyrgyz government for control of its asset. This week, though, traders said that short-selling had knocked the value of its shares. It finished the week at C$6.72, a fall of over 8%, and its lowest level since the start of March.

Other notably fallers include Nostrum Oil & Gas, which lost around 4.7% of its stock price, more than the fall in oil, and TBC Bank, a Georgian bank, which also shed around 5% of its value, possibly because inflation data remained stubbornly high.

ENDS

(News report from Issue No. 333, published on June 19 2017)

Stock Market: Tethys, Centerra Gold

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APRIL 6 2017 (The Conway Bulletin) — Shares in oil producer Tethys traded up at 1.73% on Monday despite full year results showing that its revenues from oil and gas sales had fallen by 47% to $11.7m.

It blamed the drop in revenue on the devaluation of the tenge in the second half of 2015 and a drop in oil output. Tethys sells most of its production on the domestic Kazakh market.

Despite the drop in revenues, Tethys said that its losses for 2016 were actually smaller than its losses in 2015, perhaps driving the price up 26% on the London Stock Exchange. Tethys if one of the region’s most illiquid stocks.

Most of the savings came in tight cost-cutting in administrative issues. It said that losses for 2016 were $46.9m compared to $74.6m in 2015. Tethys is pulling out of a project with China’s CNPC and France’s Total in Tajikistan because it couldn’t keep up with its call payments. It is also locked in a commercial dispute in Kazakhstan which has meant that the bank accounts of its subsidiary have been frozen.

Despite hitting a 6-month high of C$7.65, analysts have been lining up to give Centerra Gold’s stock a hefty ‘buy’ rating.

CIBC gave it a target rating of C$10 this year and CSFB went even further with a rating of C$10.25. The consensus target price is C$8.08.

The buy ratings appear to be based on strong gold prices which are enough to shrug off Centerra Gold’s spat with the Kyrgyz authorities. Kyrgyzstan wants a direct stake in the Kumtor gold mine, its largest industrial asset, which is wholly owned by Centerra Gold. Instead it currently holds a 32.7%% stake in Centerra Gold.

ENDS

(News report from Issue No. 323, published on April 6 2017)

Centerra expects to have to pay Kyrgyz fines

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BISHKEK, FEB. 23 2017 (The Conway Bulletin) — In its 2016 results Toronto-listed Centerra Gold said that it expected to have to pay all or part of a set of fines handed out to it by Kyrgyz environmental bodies over what it had previously described as an attempt by the government to pressure it into ceding a larger stake in the Kumtor gold mine.

Centerra Gold is locked in a battle with the Kyrgyz government over ownership of the Kumtor mine. Kyrgyzstan owns a 32.7% stake in Centerra Gold but it wants to own a direct stake in the mine which generates about a tenth of its GDP.

Last year Centerra launched an action at an international arbitration court after a Kyrgyz judge ordered cash generated by the Kumtor mine to stay in the country.

“If the Company were obligated to pay these amounts, it would have a material adverse impact on the Company’s future cash flows, earnings, results of operations and financial condition,” Centerra said.

ENDS

(News report from Issue No. 318, published on Feb.24 2017)

Buy gold, not som, says Kyrgyz Central Bank chief

BISHKEK, FEB. 15 2017 (The Conway Bulletin) — In an interview with the Bloomberg news agency, Tolkunbek Abdygulov, head of the Kyrgyz Central Bank essentially told ordinary Kyrgyz that they should buy gold rather than keep their savings in the unpredictable Kyrgyz som.

Gold is considered a safe-haven for investors and savers whenever the global outlook is fragile but it holds added importance in Kyrgyzstan, which relies on the Kumtor gold mine to produce over a tenth of its GDP.

Like the rest of the region, an economic slowdown has hit the Kyrgyz economy, denting GDP growth and undermining the economy. The Kyrgyz som has slid from around 50/$1 to 69/$1.

Mr Abdygulov appeared to reference this som weakness in his interview with Bloomberg.

“Gold can be stored for a long time and, despite the price fluctuations on international markets, it doesn’t lose its value for the population as a means of savings,” he was quoted as saying.

Over the past couple of years, the Kyrgyz Central Bank has offered to sell gold in different sizes to ordinary Kyrgyz and to store it safely. Mr Abdygulov said that the Bank had sold around 140kg of gold through this system.

And the Central Bank appears to be leading by example. It has increased its purchases of gold while many other central banks have reduced theirs. Bloomberg data showed that Kyrgyzstan currently holds around $190m of gold in its reserves, four times the level of 10 years ago.

ENDS

(News report from Issue No. 317, published on Feb.17 2017)

Lydian mining takes loan to operate in Armenia

FEB. 9 2017 (The Conway Bulletin) — The Armenia-registered subsidiary of Canada’s Lydian mining has taken out a loan of $50m with ING Bank to fund buying equipment at its gold mine in southern Armenia. Lydian said that the cash would be used to buy crushing, conveying and electrical equipment for its 100%-owned Amulsar Gold Project. It expects gold production to begin in 2018.

ENDS

(News report from Issue No. 316, published on Feb. 10 2017)