Centerra sells Mongolia business for US$35M www.mining-journal.com
Singapore-based private firm OZD Asia bought all the outstanding shares and debt of Centerra Netherlands, which held the Boroo mine and processing facility and the Gatsuurt project.
Toronto-based Centerra said OZD would retain the $5 million payment received in September and the further $5 million Centerra was due from Steppe Gold regarding the previous sale of the Altan Tsagaan Ovoo project.
"The disposition of the Mongolian business unit is another step forward in enhancing the overall quality of Centerra's portfolio of assets and will allow management to focus on the company's development projects in other jurisdictions, including Canada and Turkey," CEO Scott Perry said.
During the June quarter of 2017, Centerra wrote down the value of its Mongolian assets by $41.3 million and reduced the carrying value of the Mongolian assets to their estimated recoverable value of about $60 million, the company said at the time.
It had a shaky relationship with Mongolian authorities, enduring years of permitting delays and local opposition to the Gatsuurt project, while it battled to keep artisanal miners off its property.
Centerra had been expanding its geographic footprint in recent years to mitigate geopolitical risk, as a years-long dispute with the Kyrgyz Republic to complete a strategic agreement over its Kumtor operations dragged on. A new longstop deadline to end the dispute had been set for November 2.
Meanwhile, the company was dealing with an acute water shortage at its Mount Milligan copper-gold mine, in British Columbia, and had pinned its production growth hopes on the much delayed Öksüt project, in Turkey, where first gold was expected by January 2020.
The C$1.57 billion company's equity closed up 3.65% Friday at $5.39, having lost 42% in value over the past 12 months.
Published Date:2018-10-15