Appendix 2
"Approved"
Order of the State Agency for Geology and Mineral Resources
under the Government of the Kyrgyz Republic
No. ____ dated _____ December 2015
Conditions of auction for the right to use subsoil object for geological exploration works at
the Akbaltyrgan area
Organizer of the auction in accordance with the Decree of the Kyrgyz Republic
Government #834 dated December 14, 2012: the State Agency for Geology and Mineral
Resources of the Kyrgyz Republic, the authorized State Authority.
1. Subject of the auction, and general information about the subsoil object.
1.1. Subject of the auction: The right of subsoil use to conduct exploration works for vein gold at
Akbaltyrgan area in accordance with the Law "On subsoil" of the Kyrgyz Republic.
Subsoil object, the right to use which is being auctioned: Akbaltyrgan area.
1.2. Form of the auction: open.
1.3. Geographical position of the mineral resources area:
The Akbaltyrgan area is located 0.3 km north of Akbaltyrgan Lake and it lies north-east from
the Kumbelsay Stream right bank to the Ala-Buka River and partly on the left bank of the river. The
area length is 2.3 km; the area thickness is 30 - 175 m.
Absolute altitude is 1800-2500 m.
1.4. Dimensions of the licensed area: 41 ° 34'20 '' N 71 ° 22'55 '' E of Greenwich.
Coordinates of corner points of the licensed area:
# of item
X
Y
1
4607465
12695345
2
4609285
12699725
3
4606858
12701698
4
4604633
12697270
Plane table K- 43 -106
Size of the licensed area is 1548.0 hectares or 15.48 km2.
2. Geological features of the license area
This zone was detected by the results of the exploratory surveying activities of the Akbaltyrgan
team in 1963.
The Akbaltyrgan zone is located 24 km away from the Ala-Buka village with a ground road
between them.
The Akbaltyrgan site has a medium-dissected terrain. The slope angles of the Kumbelsay
stream valley rarely exceed 40-450. The slopes are dissected by small sais, which are represented by
the deluvial and diluvial-proluvial deposits of 2 m thickness or even more in some places.
The zone is confined to the deposits of D3fr А sequence that is represented by light gray
limestones and dark gray scintillant dolomites with thin (0.5 m) subordinated layers of reddish-brown
fine feldspathic-quartzose sandstones, siltstones, greenish-gray platy argillites and brownish
marlstones. The rocks are steep with average northeast strike and dip north-westward and northward
at the angles of 50 - 700.
From the southeast the rocks are separated by the fault and are represented by the lilac to reddishbrown carstones of D2gv Г sequence, and from the northwest, they also contact with reddish-brown,
pink and red feldspathic-quartzose sandstones of D2gv Е sequence along the fault.
The Akbaltyrgan zone has two nearly parallel faults of the northeast strike that are truncated by
younger northwest faults. In addition to these large faults countering this zone there are some small
sub-parallel northeast faults feathered by fractures and some intersecting faults of the northwest strike.
The faults of the northeast strike have the planes inclined to the northwest at the angles of 65 - 80°.
The northwestern faults dip steeply (80-85°) to the southwest. Within the fault zones, the rocks
are intensely fractured, broken, ferruginized rocks, brecciated peremyaty, ozhelezneny, brecciated, and
turned into loose yellow limonite and lime-ferruginous breccia. Along the Ala-Buka River, there is a
continuous 100-meter zone of mountain limonite ocher and lime-ferruginous breccias formed due to
convergent fault bundle of the northeast strike. To the southwestward, these faults are apart and the
separate zones of limonite are observed at the distance of 500 meters from the Ala-Buka River.
The Akbaltyrgan mineralization zone is divided into two sites (eastern and western sites) by the
degree and nature of mineralization and the nature of host rocks.
The western site is located on the right bank of the Kumbelsay Stream. The site is limited by
faults from the north-west, south-west and south-east. The northeastern border runs along the
Kumbelsay stream.
The site is represented by light gray, gray and dark gray scintillant limestones and dolomites of
the lower sequence of the Frasnian (D3 frА). The interlayers (0.2 m) of reddish brown fine-grained
feldspar-quartz sandstones, siltstones and thin platy greenish gray mudstone are observed between the
limestone and dolomite in the subordinate amount. Angles of dip are steep (60-80°) to the northwest.
Site mineralization is confined to the fault zones of the northeastern strike and their numerous
feathering fractures.
The fault zones are represented by limestones and dolomites in the form of loose I yellow or
dark brown lime canga. Thicknesses of these zones vary between several centimeters and 5 meters;
their length is 50 meters.
One of such zones of 1.5 m thickness and length was mined by ancient miners, as evidenced by
ancient workings discovered here in 1963. The old mine, which is similar to the adit, was carried out
along the yellow and dark brown limonites limonitized limestones, where sometimes the small spots of
malachite and azurite are observed.
Width of the mine ranges from 0.6 to 4.5 m. It depends on thickness increase and decrease.
Length of the mine is 30 m. Azimuth of fetch direction: 230 °.
Obviously, the ancient miners worked out the richest gold-bearing loose yellow limonite and
partially heavy brown limonite. A minor amount of the latter is still observed on the walls of the mine.
Basically the walls are represented by very strong armored slightly ferruginous limestone.
In 1964 we collected trench samples from the old mine. Based on the assay of these samples the
average content of gold in the mine is 4.0 g / t and silver is 1.3 g / t. In addition, the samples contain
copper of up to 1.48% and mercury of up to 0.06%. It is interesting to note that the high content of
gold, silver and copper, and mercury is detected in samples taken from dense brown limonites that
contain malachite and azurite.
Three trenches were dug to open original areas in the western site. Trenches No. 12 and 13 did
not open morainic rocks. Ditch No1 located near the south-western border of the site opened the zone
of highly fragmented, broken limestones (limonitized limestones) of 4.5 m thickness. The zone was
tested by two trench samples, which contained 0.2 g / t of gold and 1.6 g / t of silver.
Limonites found in this area, as well as the limestones, dolomites can be traced in the north-east
direction on the left side of the Kumbelsay Stream and further up to the Ala-Buka River forming the
eastern section of the Akbaltyrgan mineralized zone.
The eastern site is located in the Kumbelsay-Ala-Buka interstream area and partially on the left
side of the Ala-Buka River. The site length in the north-east direction is up to 1900 m and the width is
from 50 to 170 meters.
The site is composed of highly fragmented, brecciated limonitized limestones, dolomites of
member D5 fr A. Sometimes the altered rocks contain layers of almost fresh dark gray "sparkling"
dolomites, gray, light gray and sometimes brownish limestones and platy marlstones. Small amount of
interlayers (up to 1m) of interstratified fine-grained sandstones, siltstones and greenish-gray platy
mudstones occur among limestones and dolomites. The rocks spread to the north-east and dip to the
north-west at an angle of from 50 to 70 degrees.
The site is characterized by two systems of occasional breaks. The breaks of the northeast strike
are almost identical with the strike of limestones and dolomites. Dipping of these breaks planes is steep
(70-80 °) to the north-west rand to the north.
The breaks of the northeast strike are usually of considerable length, are cut and displaced by
younger, less long, short breaks of the northwest strike.
At the intersections of breaks there is a particularly intense hydrothermal alteration of rocks,
although in the areas of the northwest breaks the alternation of rocks is rather weak.
In the fault zones of northeast trending the limestones, dolomites are limonitized, heavily ground,
converted into loose limonites of yellow and yellowish-brown color, as well as in lime-ferruginous
breccia. These breccias are met very often on the eastern site. They are composed of acute angled
fragments of limestone and dolomites, cemented friable and sometimes dense carbonaceousferruginous cement. Occasionally the composition of debris and breccias contain marlstones, finegrained sandstones, mudstones.
Breccias are usually very porous, in case of weathering numerous voids and holes are formed.
Such breccias are formed from layers of limestons and dolomites, are of great extent and can be traced
in the form of separate near-parallel ridges on the rough corroded surface.
Between the breccias and layers of weakly altered limestones and dolomites there are thick (up to
50 meters or more) 200 m long areas of limonites, limonitized limestones, strongly broken and ground
siltstones and mudstones. These zones consist of a mass of small areas with a thickness ranging from a
few centimeters to 3.5 meters.
These small areas are merged into one large area of up to 100 meters towards the Ala-Buka River.
Because the western sector of the Akbaltyrgan area shows the confinedness of gold to limonites and
limonitized limestones, we dug trenches in the eastern section of the area only in the zones of loose yellow
limonites, limonitized limestones and calcariferous - ferruginous breccias. Such a selective location of trenches is
also explained by large sizes of the area and by the fact that the design trench work scope was insufficient for the
Akbaltyrgan team.
Most of trenches were dug on the eastern sector and revealed the ore bodies presented by yellow
and brownish, sometimes pinkish and lilac limonites and calcariferous - ferruginous breccias. Dense brown
limonites with malachite and azurite smears are observed in the western sector in the old mine, here
they are met extremely rare. Limonites, uncovered in the trenches, as well as calcariferous - ferruginous
breccias and partially enclosing limestones and dolomites were tested by the trench samples.
Based on the assay, most of the trench samples taken in the eastern sector of the Akbaltyrgan area
were empty. Part of the analysis shows the gold content in the samples from the gold traces to tenths g
/ t. The individual sample weights show the gold content of up to 245 g / t.
Such sudden fluctuations in gold content in the weighed portions testify to the fact that in the
upper part of the Akbaltyrgan area the largest gold distribution is extremely uneven.
According to the data of 1964 mineralized zone size is 2100x50x200m, it contains
2100x5.2x100m ore bodies, with Au the content of 6.4 g / t, probable reserves of P2 category are
14.97 t to a depth of 100 m.
To date the Akbaltyrgan area of mineralization has been poorly studied. To ensure final
evaluation of the area it is required to carry out geological explorations with regard to the considerable
amount of surface minings and drilling operations followed by subsequent sampling and analytical
work.
Bibliography
1. I.I. Voytovich and et.al. Geological structure and mineral resources of the Alabuka
River basin. (sheets К – 42 – 95-Б-б and К – 42 – 95 – Б-г) Report based on the results of
exploratory surveying work, scale 1: 25 000 for 1963-1964, Osh 1965, GF 01320.
3. Basic requirements for the subsoil use object.
3.1. Basic requirements for subsoil use object are specified in accordance with the
legislation of the Kyrgyz Republic related to the subsoil use and should be included in the
subsoil license. Detailed requirements are specified at registration of license in the licensed
attachment.
3.2. The main requirements for the use of the licensed area are:
- Conclusion of a licensed attachment for the drafting of work designed to mining of
licensed area;
- During the design the adjustment on the licensed area with the entering of the reserves on
the state balance;
- submission, within the time specified in the licensed attachment period, of the operations
plan designed to mining of licensed area, passed examination in respect of industrial,
environmental safety and subsoil protection, as well as Certificate for temporary use of plot for
subsoil use;
- Submission of semiannual information on progress of conditions of the licensed
attachment until July 15 of this year;
- Submission of annual report till January 31 of the new year, in the prescribed form,
approved by the authorized state body for the implementation of the state policy on subsoil use
and on electronic media;
- Submission of program (plan) for the development of mining work until January 31 of
the new year;
- Performance of all required types of mining operations in strict accordance with the
project, which has been examined in the industrial, environmental safety and protection of
mineral resources;
- Development of the Action Plan to ensure the requirements of industrial safety at work,
including the prevention of accidents and their consequences localization with required
justifications and calculations as at the site and as a result of accidents at other facilities in the
area of location of the object. In developing these measures should be considered hazards
(landslides, avalanche danger, etc.), risk factors, conditions for the occurrence of accidents and
their scenario, the number and placement of production staff;
- Provide a report on the results of exploration work with graphic materials and the results
of laboratory research;
- Technical and biological reclamation of disturbed soils in accordance with the design
decisions which are passed examination for industrial, environmental safety and subsoil
protection, and according to legislation of the Kyrgyz Republic.
In case of default by the auction winner in the future the main requirements for the use of
subsoil object, then to it will be penalized at a rate of 0.1% per day of the paid value of the object
subsoil by the subsoil user for each day of delay in the fulfillment of the commitments.
4. Time and place of the bidding: Auction will be held on February 5, 2015 in the building
of Ala-Buka district state administration of Djalal-Abad region.
Registration for the bidding starts from 11-00 to 11-50 hours. Start of the bidding in 12-00
hours.
5. Deadline: Bids would be submitted from December 15, 2015 to February 1, 2016
inclusively, daily on working days from 9-00 hours to 15-00 hours by Licensing Department of
the State Agency for Geology and Mineral Resources under the Government of the Kyrgyz
Republic, office No. 221.
6. Place and time for familiarization with the terms and conditions of the bidding:
Licensing Department of the State Agency for Geology and Mineral Resources under the
Government of the Kyrgyz Republic, office No.217, every day from 9:00 to 18:00 hours.
7. To participate in the bidding the bidder personally or by the authorized representative is
submitting bid to the auctioneer till 15-00 hours of February 1, 2016, inclusively, in duplicate, in
the form prescribed by the auctioneer and posted on the official website of the auctioneer:
www.geology.kg.
Filing by mail is not allowed.
Auction participation application form for subsoil use of objects should be filled by a
computer approach in state and/or official languages, printed by electronic printers.
Bid should be attached by the following documents:
- Copies of the founding documents and the certificate of incorporation;
- A copy of the certificate of state registration of the citizen as an individual entrepreneur;
- A copy of the appointment of the executive body of the organization;
- Power of attorney to the representative, executed in accordance with the legislation of the
Kyrgyz Republic, where a person would act by his representative;
- document evidencing of payment of the guarantee fee;
- A document confirming payment for tender fee;
- A foreign entity additionally submits legalized extract from the state register or other
certificate that it is a valid legal entity under the laws of their country;
- companies registered in the Kyrgyz Republic, including subsidiaries of foreign
companies registered in the Kyrgyz Republic, additionally submits a certificate of tax service on
the absence of overdue tax debts.
Bid submission is considered as consent of the bidder with all the terms of the bidding.
Certificates and documents executed by the bidder, signed by an authorized person and
stamped by bidder.
Copies of the documents should be submitted duly certified.
Constituent and other documents submitted by the foreign entity should be apostilled and
submitted their notarized translation into the state and/or official languages.
All the above mentioned documents should be delivered to the auctioneer along with the
bid.
Application materials received after the bid submission deadline would not be registered
and returned to the bidder.
8. The successful bidder, who signed the minutes of the bidding results, pays all
established under legislation payments to the budget of the Kyrgyz Republic.
9. The auction fee in amount of 10,000 (ten thousand) soms paid by the bidder to the
special account of the auctioneer:
State Agency for Geology and Mineral Resources under the Government of the Kyrgyz
Republic
Beneficiary: Oktyabr DBT (District Branch of Treasury)
Beneficiary`s Bank: Oktyabr branch of OJSC RSK Bank in Bishkek city
Settlement/account 1290534132810077
BIC (MFO) 129053
TIN 03010199610110
OKPO 05804223
STS: 004 Pervomay district
Payment code: 14238900 in the bank
Purpose of payment: to the State Geology Agency for tender fee or for the guarantee fee to
#Personal/account 4402032100002327 9 (point the guarantee fee or auction fee).
Tender fee is not subject to return, except in case of cancellation of the bidding, or when
the bidder withdraws its bid prior to the start of bidding, or would not be allowed to participate in
the bidding. In case of return of the tender fee, it is payable to the bidder within 30 banking days.
10. Guarantee fee in the amount of 15,480 (fifteen thousand four hundred and eighty) US
dollars, paid by the bidder in the national currency at the exchange rate of the National Bank of
the date of transfer or guarantee fee to the special account of the auctioneer specified in
paragraph 9 of this document.
Guarantee fee is refunded to the bidder/participant within 30 banking days from the date of
signing of the final minutes of the meeting of the tender committee.
A bidder, who refused to sign the minutes of the tender as a successful bidder, is
eliminated from the number of bidders. Contributed by him guarantee fee is not refundable.
11. The starting price of the auction subject is 15,480 (fifteen thousand four hundred and
eighty) US dollars.
12. Bid increment is set at 1548 (one thousand five hundred forty-eight) U.S. dollars, the
maximum increment- 30,960 (thirty thousand nine hundred sixty) U.S. dollars.
13. The bidding is acknowledged as void in following cases:
1) In the absence of bids or if only one bid is submitted;
2) To participate in the bidding admitted only one bidder or no one is admitted;
3) To participate in the bidding, only one registered bidder or nobody is registered;
4) Bidders offered a price not higher than the starting price.
14. The successful bidder is the bidder who offered the highest price for the lot. On the day
of the bidding, the successful bidder signs the minutes. Refusal of the successful bidder to
confirm its results the same day (i.e. refusal to sign the minutes) or non-payment of his proposed
price for subsoil use within five banking days after the signing of the minutes on bidding is
deemed to be a waiver of subsoil license of object, the guarantee fee is not refundable.