Uzbek newspaper 'Pravda Vostoka'
August 14
oger Turner, the chairman of the board of the British company Oxus
Resources Corporation, has given an interview to an Uzbek newspaper about
his firm's operations in Uzbekistan. Turner discussed the company's
involvement in gold ore extraction in the country. The following is the
text of the report by the Uzbek newspaper Pravda Vostoka, published on 14
August. Subheadings have been inserted editorially:
A press release recently circulated in Britain by the Bankside Consultants
Ltd financial agency said: "The Oxus [Resources Corporation] ore-mining
company is the first British company with major investments in the Republic
of Uzbekistan to be floated on the London Stock Exchange. Eight million
pounds was collected for the initial financing of gold and polymetals field
development in Central Asia. A statement offering the shares was made at
the Alternative Investment Market (AIM) and the sales at AIM started on 4
July. A total of 26.6m shares were offered to financial establishments,
which put the market capitalization of the Oxus company at approximately
37m pounds sterling."
All world news agencies circulated this purely business information, and it
is of great interest to business people. It was also a remarkable event for
our young state. The world already knows us as a country with great
potential. But this is evidence of not only real investments, but also the
attraction of both solid financial institutions and large numbers of
Western investors to it. These shares are now available for any investors
buying the shares of prospective companies and counting on the successful
investment of their own capitals. One can find a line about the Oxus
company and its projects being realized in our country in all financial
publications in the world which are reporting on the shares offered on the
London Stock Exchange.
I must admit that I waited eagerly for a meeting with the head of that
company. You must agree that the professions of geologist or miner have
something romantic in themselves. Here there was an opportunity to speak to
the gold extractors who cannot be stopped either by natural obstacles like
the sea, mountains or deserts, or by state borders.
Another attractive point is that the company's name, Oxus, is the ancient
name of the river Amudarya. On the visiting card of company staff there is
the company logo, the ibex, a golden bar in the shape of a beautiful
mountain goat which was found in buried treasure on the bank of the
Amudarya.
Background
The meeting with the head of the Oxus company took place in the Tashkent
office, near which there were a number of capacious Jeeps with number
plates indicating their Navoi registration. Later I was told that the
headquarters [of the company] were here in Tashkent, while company staff
including top management, have to spend most of their time in the Kyzylkum
desert or the mountains of Surkhandarya Region. It is there that two major
company projects are being realized.
World news agencies also circulated the news that in early September 2000
the Oxus company purchased 43 per cent of shares in the Amantaytau
Goldfields joint venture, which used to belong to the British Lonrho (35
per cent) and the International Finance Corporation (8 per cent), for 4.3m
dollars. It was then reported that an accord was reached with the Uzbek
partners that Oxus Resources would soon increase its shares in the
Amantaytau Goldfields joint venture to 50 per cent.
The Amantaytau Goldfields joint venture, founded by Lonrho plc, had a
licence to develop two gold ore deposits in the Kyzylkum desert, Amantaytau
and Daugyztau. At Amantaytau 3.2m oz of gold has been extracted, and at
Daugyztau approximately 4-5m oz. Now Oxus has become Uzbekistan's partner
in these large-scale projects. According to experts, the total cost of
capital expenditure at the first stage of developing Amantaytau is
estimated at 45-50m dollars with an annual gold production of nearly four
tonnes. By the start of 2001 Oxus Resources had prepared a full banking
feasibility study for the first stage of the field's development.
The company's second project realized in our country is the development of
the Khandiza (Surkhandarya Region) deposit of nonferrous metals. Some four
years ago Oxus Resources signed a primary agreement with the State
Committee for Geology and Mineral Resources of Uzbekistan on the
exploration of nonferrous metals in that deposit. According to the State
Committee for Geology and Mineral Resources, the explored reserves of the
deposits are 700,000 t of lead, 1.54m t of zinc, 180,000 t of copper and
2,300 t of silver. The ores in the deposit also contain selenium, cadmium,
gold and indium.
According to the agreement, the British side carried out additional detailed
prospecting of the deposit at its own expense and offered a preliminary
feasibility study of its development project. According to the study, it is
planned to build an underground ore mine and an enrichment plant at
Khandiza deposit. The finished products of the enterprise will be
concentrates of copper, zinc and lead, and silver will also be produced.
The scale of Oxus's business in Uzbekistan speaks well for its serious
intentions. The first impression we got after meeting the chairman of the
Oxus board of directors, Roger Turner, was that the story of his team
suggests that Oxus staff are not people who ended up here by chance,
either.
They include the commercial director, Richard Wilkins, who has many years of
experience working in Central Asia. Other company managers include the
chairman, Charles Arthur Cooper, the financial director, Michael de
Villiers, and also Guido Pas, Anthony Warender and Mark Wellesley-Wood.
The team has established fruitful cooperation with all its partners - the
country's State Committee for Geology and Mineral Resources and the Navoi
mining and metallurgical plant.
Working in Uzbekistan
Talking to Turner about the work that has been done and future plans, I tend
more and more towards the impression that he is a classic engineer -
modest, economical with words and, evidently, used to working in any
conditions, a representative of the romantic professions of geologist and
miner.
Since qualifying as a mining engineer at college, he has dedicated his whole
life to the profession. The locations in which he has spent his
professional career are spread wide geographically. He has taken part in
developing nonferrous and precious metal and coal deposits in Canada and
some African states.
"I have long been drawn to Central Asia and Uzbekistan," Turner says. "And
there's nothing surprising about that. Your republic is fourth in the world
in terms of gold ore stocks and ninth in terms of gold production. The
country has every chance of entering the top five. If it wasn't for the
drop in gold prices on the world market, a lot more companies would be
working here in this field."
Turner was pleased to note that his company was lucky and that it had
managed to prepare a feasibility study which enables it to start developing
the deposit even in the unfavourable situation with current gold prices. He
admitted that the Uzbek government and, most importantly, President Islam
Karimov, who is seeking gradual and progressive economic reforms, were
helping his company run its successful business in the country. There is
substantial support for investors and businessmen.
Turner mentioned a presidential decree concerning privileges in developing
underground resources. "These privileges help us make up for the drop in
international gold prices and conduct a normal business, looking to a
promising future," he said.
The head of Oxus has warm words for his Uzbek colleagues. "There are long
ore-mining traditions here. This makes the work simpler," he said. "As
regards the qualifications of local specialists working in the Kyzylkum,
they are no worse than anywhere else in the world.
Politics
Turner does not want to discuss politics, but it is impossible to avoid it.
It is, after all, a well-known fact that investors are as a rule concerned
by political stability in the country or region where they intend to
operate. Precisely because of this, I am interested in the opinion of the
head of a company which, by all appearances, intends to operate seriously
and for a long time in our country. After all, business people are well
aware that our neighbours include Afghanistan, which has been in a state of
war for many years, and Tajikistan, which is treading a difficult path to
peace and the restoration of stability.
Turner does not conceal that he has the situation well in hand.
"There are two points impacting our business," he said. "The first is the
real state of affairs. Obviously, we need insurance against political
risks for a major project such as Amantaytau. I should note that insurance
companies count Uzbekistan among more favourable countries. The second
point is subjective perception. I should admit that this was important in
our talks with financial agencies. We managed to persuade them that there
are favourable conditions for business and international cooperation in
Uzbekistan. I would like to add that, in our contemporary age, any country
can pose a risk."
The Future
Oxus is quite optimistic about its present and future in Uzbekistan. It is
not by chance that the company was given this name and logo. These can be
seen as a symbol of connection with this land and its people. It is a
tribute of respect for the huge wealth and great spiritual and historical
culture. It is because of this that Oxus highly rates the Uzbek
leadership's efforts in various areas, including in training and retraining
specialist personnel. The company is doing all it can to train young
specialists from Uzbekistan in Britain to make its own contribution to this
great work.
Summing up his meeting with us, Turner said with confidence that the number
of foreign investors in the republic would increase.
"Aren't you afraid of competition?" I asked him openly.
"No," Roger answered confidently. "There are large reserves of ore here.
There is enough for everyone. The main thing is to work. We will all be
lavishly rewarded for this."
"Uzbekistan is preparing to celebrate the 10th anniversary of independence.
What are your wishes for this special date?"
"From the bottom of my heart I would like to wish Uzbekistan prosperity, and
its wonderful people prosperity, peace and happiness."
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