LONDON (Alliance News) - Tengri Resources PLC Tuesday said it has paid over USD300,000 to its majority shareholder for providing the company a channel to do business in the Kyrgyz Republic.
Back in 2014, Tengri agreed to acquire mining assets in the Kyrgyz Republic from Robust Resources Ltd, which holds a 87.3% stake in Tengri. Under the deal, Tengri took on the Andash and Talas licenses from Robust and also earned a right to farm-in on the Bashkol license.
However, under Kyrgyz legislation certain operations, specifically employment matters, must be undertaken by a Kyrgyz entity.
Instead of establishing a separate office in the country, Tengri signed a service agreement with Robust, whereby Robust conducted operations and payments in relation to employment matters on behalf of Tengri as it is a Kyrgyz entity.
As a result, Robust has now charged Tengri USD331,740 for those services it has provided since Tengri acquired the assets in 2014. The costs have been incurred through the use of office space, payment of employee benefits and "other ancillary office expenses", said Tengri.
Tengri said the charge represents around 80% of the total charges incurred in the period.
Tengri shares were untraded on Tuesday at 3.375 pence.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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