Kyrgyz villagers raid contractor

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Bishkek - Kyrgyz villagers seized bulldozers from a construction company repairing a road to a mine operated by Chaarat Gold on Tuesday, the latest sign of unrest overshadowing attempts by the Central Asian state to attract foreign investment.

A new government in Kyrgyzstan, an impoverished former Soviet republic, is seeking investors to mine gold, coal and other minerals and bolster a fragile economy.

But attacks on several mining camps over the past 18 months have dented investor confidence. Villagers have raised environmental concerns and demanded a greater share of mining proceeds, often with the support of nationalist politicians.

The people who raided the construction camp in the Jalalabad region on Tuesday were angry about how long it was taking to repair the road which also goes through their villages, two mining industry sources told Reuters.

Eko Partner, a local consulting and legal company, issued a statement on behalf of the construction company, Spektr, saying the firm's employees had been physically threatened by a group of around 100 villagers. Nobody was hurt during the incident.

“They stole our equipment. It was a raid,” Vyacheslav Isayev, Spektr's general director, told Reuters by telephone.

Linda Naylor, Chaarat Gold's finance director, said she believed all of the equipment had since been returned. “Our operations are unaffected at the present time,” she told Reuters by telephone.

The Chaarat deposit is 320 km (200 miles) southwest of the capital Bishkek. The London-listed company expects to start production on the site in the second half of next year.

President Almazbek Atambayev has been pushing reforms to try and unlock hundreds of mineral deposits mapped by Soviet geologists but never brought into production.

Mining is crucial to the economy of Kyrgyzstan, which contracted by 4.6 percent in the first eight months of the year due largely to a decline in output at the Kumtor mine, the result of ice movement in the high-altitude pit.

Protesters have sporadically blocked the only road to Kumtor, owned by Canadian miner Centerra Gold.

Villagers in different parts of the country have also attacked other enterprises, including a Chinese-owned venture and a copper and gold deposit in Talas province owned by South Africa's Gold Fields.

Kyrgyzstan was also forced to cancel the sale of its first batch of mining licences under new legislation after protesters stormed a televised auction on August 28. - Reuters

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