Stans Energy Instigates Legal Action in Kyrgyzstan
Wednesday 1 August 2012
TORONTO (Stans Energy press service) –Stans Energy Corp. has initiated legal action in Kyrgyzstan against the decision of the committee in the Jogorku Kenesh, represented by Rep. Badykeeva that has demanded that the Company’s Licence Agreement #3 be annulled in contradiction to the earlier lawful approval by the State Geological Agency.
Stans Energy declared that it has initiated this legal action in response to the lack of due process exhibited by this special committee under the guidance of Rep. Badykeeva, and to address fundamental errors of fact and of law made by that special committee. Further to the purported Licence annulment, this committee has recommended that the Mining Licence held by Stans for the Aktyuz ore field is put up for tender. Stans Energy estimates it is Stans’ legal opinion that this action contradicts all current legal provisions set out by the Kyrgyz constitution, including those intended to protect foreign investors from false expropriation.
The Company and its Kyrgyz advisors believe this committee failed to follow Kyrgyz laws, in that it:
- failed to follow legislated inspection and investigation procedures and due process in respect of the activity of the State Geological Agency,
- failed to consider the interests of the Company or afford the Company due process,
- acted beyond its legislated authority and interfered in activities of the government of Kyrgyzstan and the State Geological Agency over which it had no right or capacity, and
- now seeks to direct the State Geological Agency to implement a form of expropriation, which is contrary to the Kyrgyz law.
While this legal action is ongoing, Stans Energy declared it will continue to operate and develop Kutessay II under the authority of the original decision by the State Geological Agency, which remains valid. In August, Stans Energy will be commencing work programs to recondition the open pit mine and roads with the assistance of locally hired employees from the village of Aktyuz. The scope of work was set out in the extension of Licence Agreement #3 and the Company has every intention of continuing to honour and meet its obligations as set out by the State Geological Agency.
In collaboration with the current residents of the village of Aktyuz, a three member committee will be appointed by the residents to represent local interests in a public-private partnership that Stans is negotiating, again as set out in the conditions to its current Licence Agreement #3.
Robert Mackay, President and CEO stated:
We hope to resolve this issue quickly and decisively both for shareholders and for all the local stakeholders involved. To ensure continued foreign investment it is important that the rule of law is respected and transparently enacted in all cases regardless of jurisdiction. We feel that by respecting current Kyrgyz laws, as set out in the constitution, and appealing to the local courts, Stans Energy Corp.’s claims will be validated, and moving forward we can minimize future disruptions of this kind.