Kyrgyz Supreme Court rejects Chinese claims over Stans Energy mine

By bne IntelliNews November 19, 2014

Kyrgyzstan's Supreme Court has upheld a ruling by the Bishkek city court that Chinese firm Baotau Hongbo has no rights to the rare earth Kutessay II mine, Canadian company Stans Energy, which claims to be the mine's rightful owner, said in a statement on November 18.

Baotau Hongbo owned a mining licence for Kutessay II between 2006 and 2009. The firm brought suit against the Kyrgyz State Agency for Geology and Mineral Resources, which issued a new mining licence for Kutussay II to Stans Energy in December 2009, with the intention to reclaim licence rights to Kutessay II. The Inter-district Court of Bishkek first ruled in favour of Baotau. An appeal was then filed by Stans Energy to the Bishkek City Court, which eventually overruled the lower court ruling and held that Baotau had no rights to Kutessay II. Baotau also appealed, but its appeal has now been definitely rejected by the Supreme Court.

It is not clear yet if the Kyrgyz government is willing to comply with the latest Supreme Court's ruling as authorities notified the company earlier this month that they were moving to revoke its mining licenses for the Kutessay II and Kalesay properties, another rare earth deposit close to Kutessay II, as confirmed by Stans Energy in a statement on November 13.

Stans Energy, which has not resumed operations at Kutessay since 2012, is now seeking the enforcement in Canada of a ruling by an arbitration court in Moscow that awarded the company $118.2mn in refunds and damages. The company expects a definitive ruling by the Ontario Supreme Court to come through in the coming weeks. In the meantime, the same Ontario Supreme Court issued a preventive injunction on October 14, which, among other things, prohibits the Kyrgyz Republic "from selling, disposing, exchanging, assigning, transferring, pledging or encumbering" 47mn shares worth $255mn in the capital of Centerra Gold owned by the government through state mining company Kyrgyzaltyn. Centerra Gold owns and operates the country's flagship gold Kumtor mine. The Kyrgyz state owns a 32.7% stake in Centerra Gold. Stans Energy has no direct interest in either Centerra Gold or Kumtor, but the state's stake in Centerra Gold is often perceived by foreign invstors and courts as the country's only valuable foreign asset.

Related Articles

Turkish cargo plane crashes near Kyrgyz capital, killing at least 37

A Turkish cargo plane flying from Hong Kong crashed on January 16 near Kyrgyzstan’s capital Bishkek, killing at least 37. Operated by ACT Airlines, the ... more

World Bank raises growth forecasts for Kazakhstan and Azerbaijan

The World Bank’s latest “Global Economic Prospects” report issued on January 10 offers a mixed picture when it comes to the GDP growth prospects of countries across Central Asia and the ... more

World Bank improves Eurasian growth forecasts

Eurasian economies are set for a modest recovery next year with growth projected to accelerate to 3.3% in Central Asia from 2.0% expected for 2016, the World Bank said in a new report released on ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss