Mining development in the Kyrgyz Republic
The State Committee for Energy, Industry, and Subsoil Management (SCEIS) is the national authority of the Kyrgyz Republic in charge of regulating subsoil use. It includes departments responsible for the development of geological works and subsoil resources.
Geological prospecting licences are issued either following direct negotiations with an applicant for the license or on the basis of a tender. Upon successful implementation of the geological prospecting programme, a prospecting licence may be transformed into an exploration licence. Exploration licenses are valid for two to five years with a minimum work programme which if fulfilled means the licenses can be extended for 10 years or more.
An essential condition for the extension of either prospecting or exploration licences is a timely payment of licence holding fees, which increase proportionally to the license extension period.
Mineral reserves identified by exploration must be appraised by the State Committee for Mineral Reserves (GKZ), and where the appraisal is favourable, the reserves must be entered into the National Register of Mineral Reserves maintained by the State Committee for Energy, Industry, and Subsoil Management.
Submission of reserves for the GKZ appraisal includes a geological report on exploration with the calculations of mineral reserves and a justification of conditions for the calculation of commercial (mineable or balance) reserves. After registering the reserves with the National Register, the licensee must pay a state “bonus” as specified by the Tax Code.
Registering reserves with the National Register entitles the licencee to transform the exploration licence into a mining licence. The latter is initially issued for the term of up to 20 years, with a possibility of subsequent extension to the end of the reserve life.
The mining license is issued with the license agreement No 1, which contains a licencee's commitment to prepare a technical project (TP) for the deposit development. The Technical Project must contain a detailed programme for the deposit's development and ore processing, along with a financial model for the prospective operations. All calculations in the project must be based on ore and metal reserves registered with the National Reserves Register. The detailed engineering design must include an EIA (OVOS) section, which sets out the environmental impact assessment of the proposed development.
Prior to submission of the Technical Project to the SCEIS for approval, it must pass three expert evaluations administered by two national authorities: a technical (industrial) safety (SCEIS), environmental safety (State Agency for Environment Protection and Forestry) and a subsoil protection (SCEIS).
In addition, prior to obtaining an approval of the Technical Project, it is required to secure land allocations for all areas required for the deposit’s operational and infrastructure facilities.
The development plan must be presented to the local communities in a public hearing and they must all agree to the proposals.
Once the evaluations are completed, the allocations secured and approvals obtained, the SCEIS and the licensee will sign a license agreement specifying the mandatory start date for the deposit's development. Until this specified date, the company must complete the detailed designs for all mining, processing, and infrastructure facilities, along with their construction. The detailed design documents known as Working Projects (WP) must be in full accordance with the relevant sections of the approved Technical Project.
It is possible to obtain permission for parallel construction and preparation of detailed designs for mining and processing if a permit is issued by the State Agency for Architecture and Construction but this is not a foregone conclusion. Before applying for this permit it will be necessary to obtain the Architecture and Planning Specifications (APU) for the buildings and structures from the regional authority on architectural and construction based on the contents of the TP.
The WPs for construction of the permanent buildings and structures must pass construction “expertise” at the regional authority on architectural and construction and the State Agency of Architecture and Construction for their compliance with the APU and the safety requirements for buildings and structures.
Once the construction is underway, a special committee will be appointed to commission all the production and infrastructure facilities, including amongst others representatives of the company, the general contractor, the designer and inspectors from the State Inspectorate for Environmental and Technical Safety, the State Architecture and Construction Committee, the State Environmental Agency and the local authorities.