Sydney, Feb 6, 2006 (ABN Newswire) - We’ve been operating in the Kyrgyz region for eight years, ever since the company was started, and in that time the relationship with government, and working with government, has always been productive. The government has kept to their side of the licence agreement without exception, all the way through, and they’ve been very understanding any time we’ve asked to go back to vary any of the conditions when we’ve seen that conditions out in the field have changed. So that’s brought us up well to the change of government in March last year. Since then the government has kept to all the agreements that were in place under the old regime. We’re really looking forward now, to the government coming to grips with some changes that are going to make it more attractive to foreign companies to work in the republic.
As you know, at the end of 2005 we were faced with having to renew almost all our licence areas and particularly the Urtash licence area which is our real major asset. The government was exceptionally co-operative. With some changes that have come in, in the industrial system, we had to get an agreement between the government, between Sentera at Contaur on our mutual boundary and with Kentor Gold Ltd. It all went very smoothly. We’ve got everything that we wanted in place, and in fact now we’ve got the Arkval area on a four-year licence, which gives us some real certainty to go into the future now and to be doing some serious exploration.
With the change in government, it’s not only standing by all its old agreements with explorers and mineral companies in the country, it’s looking at accelerating the World Bank review of the mining code. This should be finished by early in 2006. The prime minister has told me directly that the government is fully committed to implementing the recommendations that come out of this World Bank study, and it’s going to give people more predictability and more security than we have now.
It’s over the years that you actually develop more of an understanding and a constructive relationship with the government in the Kyrgyz Republic, because no matter how much the government itself has changed, it’s the public servants, the people, the administrators there are the same people, and where we really got close to them was during the last slump where because of various factors only two companies stayed there and spent money continuously throughout the slump: Barrick Gold and Kentor Gold, and both of us now have a special relationship with the Kyrgyz government.
About KGL Resources Ltd
KGL Resources (ASX:KGL) is an Australian mineral exploration company focussed on increasing the high grade Resource at the Jervois Copper-Silver-Gold Project in the Northern Territory and developing it into a multi-metal mine.
