The value shares Centerra Gold Inc. on the Toronto Stock on 03.12.2020: 10.4 USD Value of Kyrgyzstan's shares in Centerra Gold Inc. : 804 978 366 USD

“Nationalization” and “Good” Are No Synonyms

published: 10 December 2013

Later this December Jogorku Kenesh is expected to adopt yet another earthshaking decision with regard to Kumtor.

This is a moment that ordinary Company employees are anticipating filled with anxiety and dismay. Yet, dismayed as they are, many still hope the final solution will prove beneficial to this country.

Ardakbek Musayev, a senior hydrometallurgical equipment operator, has already witnessed a large operation collapse.

“Three years after my graduation from Frunze Polytechnic Institute I got a job at an electrotechnical plant at Kaji-Sai. In the early 1990s, our operation collapsed following the breakup of the Soviet Union. I quit as soon as I realized what would be the end of it. I just hated to watch such a good operation go to the dogs,” Ardakbek recalls.

This is the seventeenth year since he joined Kumtor.

His current job is instrumental at one of the final stages of gold extraction. He supervises the process of recovering the previously absorbed gold particles from coal for further processing.

“The working conditions are excellent. We are well provided with everything we may need, including the uniform, protective gear, instructions where the whole process is described in detail.”

Musayev is worried by the situation surrounding the Kumtor mine. But he doesn’t understand the motivation of those who intend to destroy gold production.

“If it’s about nationalization, it would be fundamentally wrong. Moreover, we know pretty well the way the State manages manufacturing enterprises. Kyrgyzstan would not really be able to keep the mine going,” Ardakbek says with assurance. “To begin with, it’s absolutely clear that supply and logistics will simply be a failure.”

According to Musayev, Kumtor’s logistics includes dozens of thousands of articles imported today from all over the world.

“Clearly, in the event of nationalization the present managers would never give over their business contacts. Moreover, the privatization question would inevitably come up in due time after nationalization. In the long run, the characters well known in Kyrgyzstan would slice and dice Kumtor only to sell it by parts,” he says.

There is, however, the other side of the shield which Musayev says is reasonably concealed from view by Jogorku Kenesh members and opponents of Kumtor:

“The company contributes approximately 8 billion soms to the national budget annually. This is salaries and pensions. If Kumtor came to a standstill the living standards of our teachers, doctors, etc. would drop to what it used to be in the 1990s. Logically, the MOU rejection was a hostile act against the people of Kyrgyzstan,” Musayev concludes.

Urmat Kutmanov, who comes from Barskoon, has been working at the gold mill for five years. He is a control room operator. His duties can be summarized by saying he is “responsible for everything” for he tracks every stage of gold recovery. In a measure, he is also responsible for safety of his fellow workers. A difficult job, but Urmat likes it.

“After my graduation from the Mining Institute I spent two years looking for a job. All this time, though, I knew pretty well that I wanted a job at Kumtor. Why? Because before joining Kumtor I did my practical training at a plant in Bishkek and could compare things.”

Urmat is really worried by the latest developments in Kyrgyzstan regarding Kumtor. There are two major reasons for the current problems, he believes. It’s a welfare mentality widely spread in Kyrgyzstan, in the first place.

“We have seen a lot of times how it works. Some people work hard improving things but then other people come to take away what has been done before them.”

On the other hand, it’s politicians who are stirring the pot:

“They realize that the economy would stall if Kumtor came to a halt. The country would feel it at once, and some people would see it as a good pretext for a third revolution. It’s clear all these guys that are blocking the roads are just tools in the clever hands of politicians.”

A great deal of things could be avoided if people in this country knew a bit more about gold production, he observes.

“What I find especially outrageous is MP’s allegations that we use obsolete gold recovery methods like cyanidation. I’m almost tempted to ask them, ‘Well, honorable men, would you kindly point us towards some other technology? Have you made a great discovery in this field?’ This twaddle doesn’t jar upon the ear of ordinary people, of course. On the contrary, they just lap it all up,” Urmat says with some heat.

Kutmanov is highly skeptical about the nationalization idea. He is very doubtful of the government structures’ ability to manage the mine effectively:

“To tell the truth, they will bring the company’s current practices to naught. Not a trace will remain of the present safety standards. One of the safety guarantees today is a ban on relations working in the same division, and it will be destroyed.”

Abdybek Asankojoyev has been taking Kumtor employees to the mine and back for seventeen years. His working hours begin at 4 a.m. After undergoing medical examination he sets off to the garage to inspect the operating conditions of his bus and warm it up.

“It’s routine for us that we should descend from the mine and ascend back every day. It’s not the easiest thing in the world. First, you experience elevation changes, and next, the driving conditions are really treacherous. You need to be very attentive while driving on these winding roads on an ice-slick. Our duty is to carry humans, and we should not forget about it.”

According to Asankojoyev, the Company’s safety standards are very serious.

“All the rules of the road are observed by us without fail. This is a good habit, I should say. I’ve trained my whole family to the road discipline. We never travel unbelted,” the driver remarks with a smile.

The dearest dream of this Kajisai man, who has given forty years of his life to driving, is to retire on a pension as a Company employee.

“That’s what things were like under the Soviet Union. One used to work at one and the same enterprise for the whole of one’s life. Before joining Kumtor I spent years working at Kajisai. I don’t want to change my job anymore,” explains Abdybek.

Nor is he facing the future with confidence now that a company that’s provided him and his family with the sense of security all these years is at risk:

“Were the legislators real patriots they would be working to found more companies like Kumtor. Kyrgyzstan would see more jobs and less problems in that event,” the driver says. “Judge for yourself. Should the Kumtor guys be urged to participate in a picket or protest, none would come out. It’s because they have their jobs, plans, prospects, dreams.”

Kubanychbek Kurmanov, a grader operator who’s been working at Kumtor for eight years, says there’s more than one thing he can’t figure out in the situation surrounding the mine. The MOU was rejected in the course of a routine political gamble, he claims.

“The lawmakers don’t care a bit about ordinary people while Kumtor is just a topic enabling some of them to earn political capital or get a long hoped-for office. Why should the entire country be a victim of somebody’s personal ambitions?” Kurmanov asks.

Another thing he can’t understand is why some people wish so strongly to take away means of livelihood from him and his family:

“I’d like to ask people calling for closure of Kumtor, ‘Do you have any decent job to offer me down there? A job enabling me to support my children?’ ”

Kubanychbek is a grader operator handling a unit which is the biggest in Central Asia. His grader is a $2.3 million monster purchased by the Company a couple of months ago. Its blade is 12 meters wide making it possible to optimize grading and cut road clearing costs:

“Now, to clear a road for Caterpillar I have to make one run only while previously I had to make two,” Kurmanov explains.

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The value shares Centerra Gold Inc. on the Toronto Stock on 03.12.2020: 10.4 USD USD Value of Kyrgyzstan's shares in Centerra Gold Inc. : 804 978 366 USD
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