Appendix 2
"Approved"
Order of the State Agency for Geology
and Mineral Resources
under the Government of the Kyrgyz
Republic
No. ____ dated _____
Auction terms on granting of the subsoil licence for the placer gold field
Kuilyu Site
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.
1.1. Subject of the auction: Subsoil licence for the geological prospecting of
the field Kuilyu, in accordance with the Law of the Kyrgyz Republic “On Subsoil”.
Subsoil object, the licence of which is put up for auction: Kuilyu field.
Placer gold deposit Kuilyu administratively belongs to Ak-Suu district of
Issyk-Kul region.
1.2. Form of the auction: open.
1.3. Geographical location of the subsoil object:
The absolute altitude ranges 3600 – 3800 m.
1.4. Dimensions of licence area:
Coordinates of the mining allotment on the topographic base with scale
1:50000 of the sheet К-44-51:
№№ points
1
2
3
4
5
6
7
8
9
10
11
Y
14337125
14339745
14342980
14344825
14345418
14342250
14340380
14339421
14341728
14340570
14337183
X
4677732
4677066
4674922
4676020
4675405
4671136
4666974
4667195
4672702
4675187
4676575
The area is – 2139 ha.
2. Geological characteristics of the licence area
The field is located in the area of the sheet K-44-51, 63, on the right valley
side of the same-name river, tending to water-divide part of the northern slope of
Kuilyu ridge within the altitude ranging 3600 - 3800 m.
The nearest residential area is the settlement Enilchek, locating 30 km from
the field, which is connected with the regional center city Karakol by a highway of
156 km.
The nearest railway station is in Balykchy city, located in the western end of
Issyk-Kul Lake, 225 km from Karakol city.
The high-voltage power line (110 kV) is stretched 20 km to the south,
supplying the Sary-Jaz mining and refining plant and the highway Karakol –
Enilchek is stretched 5 km to the east.
The nearest river - Kuilyu - flows 1.5 km to the north; it is the right tributary
of Sary-Jaz River.
The field area is classified as the 8-point seismic zone.
The area population is few and mainly engaged in livestock breeding.
The deposit consists of two sections: Echkilyutash and Kuylyu. The first is
located in the valley of the river segment sublatitudinal Sarydzhaz, the second - on
submeridional. They shared the estuary Kuylyu.
In 1980 - 1985 years V.A. Grishchenko, N.N. Ishalin et al carried out the
exploration and geological surveying works with scale 1: 50 000 on this area.
Graphite was noted in the description of the third unit of Kuilyu suite. Actually, the
Kuilyu field was discovered in 1982 by Y.P. Rykov.
During 1982 – 1984, the employers of the laboratory of stannous ore and
rare-metal ore deposits at the Institute of Geology of the Academy of Sciences of
the Kyrgyz SSR had performed the mineralogical, petrographic, chemical and
analytical, and technological researches
Since 1992, the exploration was performed by Aksu geological exploration
party of the Issyk-Kul complex expedition.
Indigenous sources of gold are not known. However, these are small
deposits of gold abundant upstream Sarydzhaz and Coyle which could be the
source.
The main ore minerals of heavy fraction: gold, pyrite, magnetite; minor:
galena, cerussite, arsenopyrite. Non-metallic minerals are zircon, sphene, apatite,
garnet, epidote. Gold is golden yellow, straw, reddish-yellow, subrounded, plastic
form. Fineness 825-910. The bulk of the gold thin and small size. There were
nuggets - 70mg.
Predicted geological reserves of gold alluvial gold deposits Sary Jaz
evaluated in 1987. Statistical method as follows:
Projected reserves of gold, 1987.
Volume of peats,
Av.con
3
thousand.m
Volume
of centrati
Land
Category
sands,
on of Gold, kgs
3
thousand.m
Au
g/m3
Kuily
Р2
3200
3200
0
480
.150
Projected reserves of gold in floodplain alluvial channel components are
estimated as:
№№ Deposit
Volume
of Av.concentration Gold,
sands,
of Au mg/m3
kgs
3
thousand.m т.м³
Category
1
590
Р2
Kuily
(riverbed)
placers
150
88,5
During this period, the crew completed the following scope of principal
works:
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 September 22, 2015
in the building of Ak-Suu state administration building, Issyk-Kul oblast
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 September 22, 2015 to November
6, 2015 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. 225.
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 November 6,
2015, 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 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 tender 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
Recipient: Oktyabrsky Treasurer’s Regional Office in Bishkek
Bank: Oktyabrsky branch of JSC “RSK Bank”, Bishkek
BIC: 129053
Settlement account: 1290534132810077
Client account: 4402032100002327
Details of payment: The State Geology Agency; payment for participation or
the guarantee fee.Details of payment The State Geology Agency; payment for
participation or the guarantee 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 21390 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 21390 U.S. dollars.
12. Bid increment is set at 2139 U.S. dollars, the maximum increment- 42780
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.