UPDATE 1-Kyrgyzstan may seek Centerra delisting after Canadian court order

Mon Oct 20, 2014 1:54pm EDT
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(Adds Centerra comment, stock price)

By Olga Dzyubenko

BISHKEK Oct 20 (Reuters) - Kyrgyzstan President Almazbek Atambayev said on Monday he could seek to delist the shares of Canada's Centerra Gold Inc on the Toronto Stock Exchange after a Canadian court effectively suspended shares in the company held by the Kyrgyz government.

The former Soviet republic owns a third of Centerra, which operates the vast Kumtor gold mine near Kyrgyzstan's border with China. The mine is a major contributor to the Central Asian country's economy.

Toronto-based Centerra said it was business as usual at the Kumtor mine and that it was continuing to negotiate a restructuring of Kyrgyzstan's stake in Centerra with the government.

The company and the government have been in discussions for more than a year on a deal that would involve the state swapping its 32.7 percent stake in Centerra for half of a joint venture that would control the Kumtor mine, the company's main asset.

Centerra spokesman John Pearson said that if such a deal was reached, Kyrgyzstan's shares in Centerra would be canceled and delisted.

The latest comments from Kyrgyzstan's Atambayev come after another Canadian miner, Stans Energy, obtained an order from an Ontario court on Oct. 14 that prohibits the Kyrgyz Republic and its state gold company, Kyrgyzaltyn, from selling, pledging or exchanging its 47 million shares in Centerra.

Stans Energy has sought payment from the government of $118 million in damages and losses after losing its license for the Kutessay II rare-earth mine in Kyrgyzstan. At current prices, Kyrgyzstan's stake in Centerra is worth around $374 million.   Continued...