Russia owes pay to gold miners

The Russian government owes mining companies 1.5 trillion roubles for some of the gold they have shipped to the state in 1996.

The industry sent about 100 tonnes of gold to refineries last year, reports Interfax News Agency.

Vladimir Piskunov, who heads the Russian Ministry of Industry’s Department for Precious Metals and Stones, says discussions are under way on how the government can honor its debt for 1996 and provide advance credit to prepare miners for the 1997 season. He says the government may stick to the traditional method of distributing advances among mining companies.

The Central Bank of Russia had offered to buy all gold mined next year, but, as the Bank is not a commercial organization, it cannot issue advances.

Commercial banks could be asked to distribute advances on behalf of the Central Bank, though this is unlikely as they do not have sufficient capital.

Piskunov says that since banks cannot export gold as collateral for Western loans and investment, they have no incentive to issue advances to the gold mining industry.

No law on precious metals and stones has been passed in Russia. Such a law was debated for several years and was nearly passed this summer when a bill got through both houses of parliament. However, it was vetoed by Russian President Boris Yeltsin.

Piskunov says representatives of the parliament and the presidential administration have not yet begun to revise the document.

He says there are too many gold mining companies in the country. Some 600 enterprises currently mine gold, compared with just 13 in Soviet times.

Piskunov believes the industry should have about 10 “big corporations,” rather than numerous small firms, and that this would make it easier to raise money to develop new deposits.

Interfax News Agency is represented in North America by Interfax-America, based in Denver, Colo.

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