February 14, 2012 / 2:28 PM / in 6 years

Centerra says Kyrgyz mine strike yet to hit output

MOSCOW (Reuters) - Toronto-listed Centerra Gold (CG.TO) said on Tuesday the ongoing strike at its Kumtor mine in Kyrgyzstan, the country’s largest, had yet to impact output as the company is processing accumulated stockpiles.

“We are currently running stockpile material through the mill,” Centerra Vice-President Ian Atkinson said at the Adam Smith CIS Precious Metals Summit in Moscow.

Centerra announced on February 6 that production at the mine had been suspended after unionized employees launched a strike over salary deductions for payments to the Kyrgyzstan’s social fund.

Atkinson said talks with the union were continuing, but that it was unclear when the dispute might be resolved.

“There have been negotiations going on between ourselves and the union, plus of course the government is involved because we are a fairly significant producer, and a fairly significant contributor in terms of the GDP,” he said.

Kumtor contributed 11.7 percent of Kyrgyzstan’s 2011 gross domestic product and 26.1 percent of its industrial output. It produced 7.8 million ounces, or 243 tonnes, from its launch in May 1997 to the end of 2010.

The mine also accounted for 91 percent of Centerra’s 2011 output of 642,380 ounces.

Atkinson, Centerra’s vice-president for geo-exploration, also said it was unclear when the company would run out of unprocessed ore at Kumtor.

“The strike’s only been out there for seven days or so. If it doesn’t continue for too long, we’ve got the balance of the year to make up any difference that may be there,” he said.

Kumtor is an occasional target for protesters. In December, residents of a town near its marshalling yard blocked the transfer of supplies to the mine in an effort to force Centerra to increase assistance to the local community.

Editing by James Jukwey

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