NOTIFICATION The Ministry for Investment and Development of the Republic of Kazakhstan as a competent authority of the Government of the Republic of Kazakhstan announced on beginning of granting subsoil use rights in a simplified order for the exploration on understudied areas of subsoil riches 1. In accordance with the Law «On subsoil and subsoil use» granting subsoil use rights for conducting exploration operations on the areas of subsoil riches, provided in a simplified order, produced by means of contract making without tender on the basis of direct negotiations. 2. The procedure and conditions for direct negotiations on granting subsoil use rights in a simplified order for exploration Subsoil use rights in a simplified order provided for exploration on understudied areas of subsoil riches. 2.1. Area of subsoil riches, granting in a a simplified order for exploration must not exceed ten blocks, each of which equal to one minute in the geographical coordinates system. 2.2. On the official web-site of the Committee of Geology and Subsoil Use of the Ministry posted an Interactive map at the address http://www.imap.geology.gov.kz/. Understudied areas of subsoil riches on the map marked with yellow color. 2.3. Area of subsoil riches, granting in a a simplified order for exploration, except for common, on the basis of direct negotiations is defined by the competent body. 3. Application requirements 3.1. For getting subsoil use rights in a simplified order for exploration, applicant sends a request, which must contain: 1) name of a legal entity, its location, corporate nationality, information on state registration as a legal entity and registration with the tax authorities, information on managers and partners or shareholders of the applicant - legal entity indicating the size of their share in the authorized capital (of the total share capital), information about curculation of capital issues of the legal person in the organized market of capital issues, indicating the total number of such issues, information about subsidiaries of the applicant; 2) area of subsoil riches designation, presented in the form of blocks on which an applicant pretend to; 3) bank guarantee or other confirmation the presence of the applicant's money sufficient to meet the requirements of minimum amount of the expenses and the types of work that must be done within the requested area within the first year after the standard contract. 3.2. Application is accompanied by copies of the documents along with originals for verification or notarized copies confirming information indicated in the application, as well as signed standard contract. Application must also contain the following information: legal, postal and email addresses, telephone and fax. The application is submitted in official or Russian languages. Application without fail is accompanied by documents confirming the presence of the applicant's money which is sufficient to meet the requirements of the minimum amount of expenses and the types of work that must be done within the requested area within the first year after signing a standard contract (1000 MCI). That document can be any of the following: 1) bank guarantee; 2) The balance sheet of the applicant; 3) Profit and loss report for the last two years, including the current year; 4) the auditor's report on the financial situation of Applicant for the last fiscal year; 5) other document, duly confirmed by the presence of the applicant's money sufficient to meet the requirements of the minimum amount of expenses and the types of work that must be done within the requested area for the first year after signing a standard contract at the discretion of applicant. Sample of application listed in Appendix № 1. 4. Geological information The lists of geological information (inventory reports), which can be viewed and purchased at the Republican Geological Fund «Kazgeoinform» RGIC in the manner prescribed by law were drawn up by blocks offered for obtaining subsoil use rights in a simplified order. 4.1. Permission for introduction of geological information provided by the authorized body for the study and use of mineral resources (the Committee of Geology and Mining) on the basis of application form according to Appendix №2 4.2. Provision of copies of geological information through «IAC» RSE REU after signing a confidentiality agreement and payment of geological information cost. Request for getting the copies of geological information is provided in «IAC» RSE REU according to Appendix №3. 4.3. List of reports of geological information specified in Appendix №4. 4.4. The cost of geological data 1 MCI for each report. 4.5. The applicant has no right to disclose in any form or transfer received geological information to third parties (paragraph 3, Article 49 of the Law «On Subsoil and Subsoil Use»). 4.6. Payment for the use of geological information is transferred to the code 201 903 «Fee for providing the information of subsoil riches for use» in the national budget. Regarding the banking details, please contact the tax authorities at the place of registration of the legal entity or individual. The cost of the geological information is not subject to return (paragraph 2 Article 49 of the Law «On Subsoil and Subsoil Use»). 4.7. For aquisition of geological information contact the Committee for Geology and Subsoil Use of the Ministry of Investment and Development of the Republic of Kazakhstan (Telephone: 7 (7172) 74 33 05). 5. The procedure for granting subsoil use rights in a simplified order 5.1. Application submission is made to the address: 010000, Astana, Kabanbai Batyr ave., 32/1, the Ministry of Investment and Development of the Republic of Kazakhstan. The applicant has a right to send an application to the competent authority by mail or to the Office of the Competent Authority. Applications received by the competent authority, registered in the office indicating the time. Each application is registered separately. It is not allowed to submit a general application into several applications. The applicant may withdraw its application. It is not allowed addition and (or) the correction of submitted Application. In the event of such a necessity, the applicant should withdraw the application and submit a new one. Start date of applications receipt - November 24, 2015, 09:00 Astana time. Deadline for applications - not limited. 5.2. The application is subject to consideration within fifteen working days from the date of its receipt to the competent authority. After reviewing the application, the competent authority receives an application or rejects it. 5.3. The application is subject to rejection in the following cases: 1) if the requested section exceeds the size limit prescribed by paragraph 1 of Article 57-1 of the Law on Subsoil; 2) if earlier on the requested area or its part with applicant or his affiliated person was unilaterally terminated the contract on exploration on the initiative of the competent authority on the grounds prescribed in Article 72 of the Subsoil Law, with a termination date less than three years; 3) the grounds prrescribed in subparagraph 4) of Article 51 (if provision of the right of subsoil use to the applicant will result non-compliance to ensure the national security of the country, including in case of concentration of the rights under the contract and (or) concentration of rights to conduct operations in the field of subsoil use) and subparagraph 4) of paragraph 1 of Article 55 (determining whether the provision by the officials participated in contest, to the person recognized as the winner of the contest, illegal advantage over other parties (applicants) of the contest and (or) liberalization of requirements) of the Law on Subsoil; 4) if the requested area or its part are in use at another subsoil user. The refusal in application acceptance did not deprive the applicant of the right to reenroll. Also, the application is subject to be rejected if the requested area is not the same to within the requested area of the previously submitted application. 5.4. The competent authority places on the official Internet resource the information on submitted applications indicating: 1) name of the applicant; 2) coordinates of the requested area; 3) time of submission. Posting an application for a predetermined area is made within 15 (fifteen) working days from the date of registration and will be marked red. 5.5. In case if within five working days after posting of information about application submitted on the official Internet site of the competent authority to the requested area aditionally submitted more than one application, then subsoil use right for this area is provided in the manner prescribed by this Law for the auction. Five working days after posting the information on application submitted on the official Internet site in accordance with paragraph 4 of Article 57-1 of the Law on Subsoil is counted from the moment of actual posting. If within five working days after posting of information on application submitted on the official Internet site of the competent authority for the requested subsurface area submitted more than one application with a complete coincidence of blocks, then a subsurface area is excluded from the list of areas provided in a simplified order for exploration within 20 working days, and the subsoil use right for this unit is available in the manner prescribed by the Law on Subsoil for auction. This section will be marked pink. Notice of the auction forms in accordance with Article 47-1 of the Law on Subsoil, no later than thirty calendar days from the date of acceptance the decision to exclude subsoil areas from the list provided in a simplified order for the exploration, between persons who applied for such subsoil area. These persons submit an application in accordance with Article 48 of the Law on Subsoil. According to the results of auction a contract based on the model contract is made. At the end of 5 (five) working days from the date of posting the area in accordance with Application, in case of absence of aditionally applied Application for the same area, area color changes from red to green, which means the beginning of registration procedure of a standard contract. Within 5 (five) working days direct negotiations is held and the signing of a standard contract. 6. Direct negotiations 6.1. Direct negotiations are conducted within ten working days after receipt of application, i.e. after posting of application on an Internet resource. 6.2. As a result of direct negotiations with applicant is made a standard contract. 6.3. Subsoil user who get a right to subsoil use in a simplified order for exploration, is exempted from the obligations by local content in personnel, goods, works and services. Direct negotiations are conducted within ten working days after the receipt of application Standard contract signed concurrently with a protocol of direct negotiations. 7. Standard contract 7.1. The form of a standard contract approved by the competent authority and must contain the following main provisions: 1) amount of expenses for social and economic development of the region and development of its infrastructure, presented in the form of annual increasing payments; 2) obligation of signed bonus payment; 3) minimum amount of costs and work types by years that must be completed within one block for the entire period of a standard contract. Approved standard contract is listed in Attachement №5. In cases when subsoil use right for exploration is granted in a simplified order a work program is not drawn up (p. 1, Art. 63 of the Law «On Subsoil and Subsoil Use»). The subsoil user, who got the right for exploration in a simplified order develops and individually approves the project of prospecting works after signing and registration of a standard contract for exploration (p. 1, Art. 64 of the Law «On Subsoil and Subsoil Use»). Application of ammendments and additions to the draft of prospecting works by subsoil user who was granted the right for exploration in a simplified order is made independently. Subsoil user sends information on any amendments to the draft of prospecting works to the authorized body on study and usage of subsoil (p. 5, Art. 64 of the Law «On Subsoil and Subsoil Use»). Granting of subsoil use right regulates by the following regulatory acts: Law «On Subsoil and Subsoil Use» dated June 24, 2010 № 291-IV; Terms of granting of subsoil use rights, approved by the Decree of the Government of the Republic of Kazakhstan dated December 30, 2010 № 1456; Standard contracts for subsoil use, approved by the Order of the Ministry of Investment and Development dated March 31, 2015, № 412 (registered in the Ministry of Justice as of 26.05.2015 №11167). The terms of direct negotiations under the simplified procedure for the exploration are also available on the website: www.mid.gov.kz Contacts: (8 7172) 75 44 67 75 44 68. In case of questions on the procedure of submission and consideration of applications please contact Department of Subsoil Use of MID RK t.syzdyhanova@mid.gov.kz, m.kapenova@mid.gov.kz. Questions on interactive map please sent to the email address imap@geology.kz.