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Stans Energy Corp. (CVE:HRE, OTCMKT:HREEF) announced today that the Government of the Kyrgyz Republic (formerly Kyrgyzstan) has notified the Toronto-based company that it is moving to revoke its mining licenses for its Kutessay II and Kalesay properties.
“The lack of due process by the Kyrgyz Government is poisoning the business environment in Kyrgyzstan and as such we remain committed to executing the award of the Moscow Chamber of Commerce and Industry,” said Rodney Irwin, Stans’ interim president and CEO.
“Furthermore this irresponsible action by the Kyrgyz Government only opens the door for future litigation and increased liability for the Kyrgyz Republic. The Company’s main focus now is to secure the US$118 million arbitration award in Canadian courts and to diversify its operations to more business friendly jurisdictions,” he added.
The company said in a statement the decision by the Kyrgyz mineral and mining authority (SGA) is based on the July 30, 2014, verdict in favour of the General Prosecutors Office against the SGA.
Stans’ local subsidiary, Kutisay Mining Ltd., filed an appeal of the July 30, 2014 ruling to the Supreme Court of Kyrgyzstan, and “despite the fact that that ruling cannot enter into force until an appeal is heard under Kyrgyz Law, the SGA has decided to revoke the Kutessay II and Kalesay Licences extra judiciously.”
According to Kyrgyz Law on Subsoil, the July 30, 2014 ruling can’t be used as the reason to revoke these licenses. Kutisay Mining Ltd. has filed a claim against the revocation by the SGA in the Inter-district Court of Bishkek which should be heard on December 8, 2014.
Stans acquired a 20-year mining license for the past-producing Kutessay II open pit rare earth mine from the Kyrgyz Republic in December 2009. In May 2011 Stans completed the purchase of the Kashka Rare Earth Processing Plant (KRP) the same plant that previously refined REEs from Kutessay II ores.
The KRP was the only hard rock plant to produce all rare earth elements outside of China, producing 120 different metals, alloys, and oxides. For over 30 years, Kutessay II produced 80% of the rare earth metals for the Former Soviet Union.
Location of Stans Energy’s Kyrgyzstan projects.
Comments
Tom Turek
1 big step forrrard.