Jun 12 (Bloomberg) - Centerra Gold Inc, a gold producer by Cameco Corp., said that the Mongolian government's permission to temporarily suspended operations for companies Boroo and can revoke them after review.
Mongolia's mining regulators suspended the permits valid for three months after inspectors cited "issues related to operations such as maintaining license records, one of the land, the handling and operating procedures," Toronto-based Centerra said in a statement today. Company says it is working with regulators to resolve the problem.
Boroo is one of the two Centerra production assets, which include the Kumtor mine in the Kyrgyz Republic. The company seeks to increase output to benefit from the price of gold increased 29 percent since Oct. 24, when the bullion reached a year low in New York.
Centerra said that years of negotiations an agreement with Mongolia's mining regulator for the development of the Gatsuurt gold deposits, about 35 kilometers (22 miles) from Boroo.
Centerra down 46 cents, or 6.3 percent, to C $ 6.84 at 11:03 on the Toronto Stock Exchange trading. Stocks that were down 10 percent, the biggest intraday decline since April 30. Centerra gain 64 percent this year before today.
Centerra announced in a separate statement yesterday that the closing agreement with the Kyrgyz government to resolve the legal disputes that threaten the Kumtor mine.
Under the agreement, Cameco, the world's largest uranium producer, will transfer to the government's 53 percent in the pole Centerra. In April, Cameco said its stake in May fell as low as 38 percent.
To contact the reporter on this story: Rob Delaney in Toronto at robdelaney@bloomberg.net.
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