August 5, 2015 2:23 pm

Arrest of former Centerra Gold CEO’s without merit: company

The arrest of Leonard Homeniuk, the former CEO of Centerra Gold, is without merit says the company.

Supplied / Centerra Gold
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Toronto-based miner Centerra Gold says the arrest of a former CEO in Bulgaria appears to be related to corruption allegations that are without merit. Centerra Gold says Leonard Homeniuk was arrested by Bulgarian authorities at the request of Kyrgyzstan, where the company’s largest gold mine is located.

Centerra Gold spokesman John Pearson says the allegations that led to Homeniuk’s arrest and detention date back to when the company was founded in 2004 and specifically relate to the Kumtor mine.

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Kyrgyzstan and Centerra Gold have sparred over the ownership and revenue of the Kumtor project for years.

A non-binding agreement signed by both sides in 2013 calls for state-owned Kyrgyzaltyn JSC to exchange its 32.7 per cent interest in Centerra Gold for 50 per cent of a joint venture that would own Kumtor.

Pearson says the company remains in negotiations with Kyrgyzstan over the future of the Kumtor mine.

Foreign Affairs said it is aware of a Canadian detained in Bulgaria and will offer consular services, but it declined to identify the person, citing privacy concerns.

Homeniuk, 68, led Centerra Gold from 2004, when the Kumtor mine was spun off into its own company by Saskatoon-based miner Cameco Corp., until his retirement in 2008.

While with Cameco, Homeniuk managed the company’s uranium exploration program and was involved in the early work on the McArthur River high-grade uranium deposit, which is now the world’s largest uranium mine.

Pearson says Centerra Gold is Kyrgyzstan’s biggest company in terms of revenue, number of employees and the amount of taxes it pays the country.

READ MORE: Protesters in Kyrgyzstan unblock Canadian gold mine

The Kumtor mine produced 567,693 ounces of gold in 2014, worth more than US$620 million at current prices.

Kyrgyzstan had issued an Interpol red notice for Homeniuk’s arrest for involvement in corruption.

With files from Global News

© 2015 The Canadian Press

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