Engineering & Mining Journal

FEB 2019

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REGIONAL NEWS - ASIA 20 E&MJ • FEBRUARY 2019 www.e-mj.com India Readies Mining Policy Blueprint By Ajoy K. Das The Indian government has worked out a blueprint aimed at liberalizing the policy framework of domestic mining, including tax incentives, co-mining of leasehold ar- eas, and even partial funding of explora- tion projects. The blueprint put out in public domain for discussion among various stakeholders is aimed at global resource developers to take up projects in India at a time when response from multinational miners to in- vest in the country in joint ventures with local companies have been tepid. The Indian government's policy advi- sory body, NITI Aayog (National Institute for Transformation of India Commission), has framed the working document that would be the basis for the next round of mining legislative and governance policy. With total tax, including a plethora of royalties and mandatory levies aggregat- ing at 65%, this made mining projects in India the highest taxed in the world. The working document caps a cumulative tax on mining exploration and development projects at 40% to make foreign direct in- vestments (FDI) more attractive for global mining companies. The policy advisory body has also laid down that specific mining leases auc- tioned to exploration or mining companies should include provisions for "co-mining." This would mean that any leasehold auc- tioned for a specific mineral would permit the successful bidder to undertake mining of all other minerals that may occur in the leasehold area other than specific mineral block that was put up for auction. However, the most significant proposal for developers was an offer of risk fund- ing to take up exploration projects across the country. The model being worked out would entail developers to float startup joint ventures with Indian companies in which former could take majority control. Such joint venture entities would be eligible for risk funding through the Na- tional Mineral Exploration Trust (NMET) fund operated by the Indian government to de-risk projects that may be taken up by such ventures. Centerra, Kyrgyz Republic Agree to Agreement Extension At the request of the government of the Kyrgyz Republic, Centerra Gold has agreed to further extend the first longstop date under the Strategic Agreement for Environmental Protection and Investment Promotion for the Kumtor mine until May 31. It first entered the agreement on Sep- tember 11, 2017. The first longstop date is the date by which all conditions prec- edent to the completion of the Strategic Agreement are required to be satisfied. Centerra said it and the government have made significant progress in satis- fying the remaining conditions precedent to completion of the Strategic Agreement, including the reissuance of Kumtor's land use certificates and the resolution of a tax claim affecting Kumtor. The company said it expected all relevant conditions prece- dent to completion to be satisfied prior to January 31, but the government request- ed an extension to May 31 and the com- pany agreed. Centerra said it will continue to pursue completion as soon as possible. Lydian Completes Hydrogeological Survey at Amulsar At the end of January, Lydian Internation- al Ltd. has concluded its isotopic inves- tigation of groundwater systems at the company's gold project at Amulsar and the Jermuk area. In November, the hy- drogeological survey was commissioned in response to technical questions raised by interested parties. Twenty-five samples were collected in the presence of agency representatives of the government of the Republic of Armenia from specific sam- pling points in the Amulsar and Jermuk areas, according to Lydian. "In summary, based on the data and analysis of the groundwater regime pre- sented in the 2016 ESIA for the Amulsar Gold Project, combined with the major ion and isotope data presented in this memorandum it may be concluded that the Jermuk thermal mineral water system is not in hydraulic connection with shal- low groundwater and surface water on the Amulsar mountain," the report said. The results of the hydrogeological survey confirmed the findings of Lydian's previous work in 2013 and support the findings of the Amulsar Project's Environmental Im- pact Assessment (EIA) and Environmental and Social Impact Assessment (ESIA). The investigation was designed to de- velop and expand the data collected for the project in 2013. Illegal blockades have prevented Lyd- ian from accessing the Amulsar Project site to perform construction and associat- ed work since late June 2018. The newly elected government of the Republic of Armenia has recently announced their intolerance of illegal road blockades and has committed to its application of the "rule of law" to remove such blockades. Until construction resumes, the company said it will continue to evaluate a range of financing, strategic and legal alternatives. The Kumtor mine (background) was expected to produce more than 535,000 oz of gold in 2018.

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