Kazakhstan’s Central Bank buying out all gold produced28 january 2015, 14:05
For the recent two years Kazakhstan’s Central Bank has been buying all the fine gold produced in the country, Tengrinews.kz reported, citing Albert Rau, Minister for Investments.
“Given the turbulent global economy condition, the National Bank has been buying out all the fine gold produced (…) annual production output stands at 22 tons a year”, Mr. Rau said, when presenting a draft law on precious metals and gems in the country’s Majilis (lower chamber).
“As a rule, prices for gold grow amidst growing demand (…) the latter is normally driven by volatility of major currencies. Currently, the keen interest to gold is assigned to the weakening Euro. Gold is seen as a stable harbor”, he elaborated.
When asked if the Government would allow gold smelters to sell gold to individuals after the country’s gold reserves are replenished, he answered “there’s never too much money in a family. In the same way, there’s never too much gold”.
The draft law seeks to oblige all gold mining enterprises to supply the crude gold to Kazakhstan-based gold refineries.
“Here in Kazakhstan we have three gold refineries. Any gold miner can choose the most suitable option. A permit to export crude gold can only be granted if all the three refineries refuse to process a certain gold-bearing muck. However, as of today, Kazakhstan-based gold refineries, the one located in Astana in particular, are capable of processing any raw material. The National Bank enjoys the preemptive right to purchase all the refined gold”, Mr. Rau elaborated.
He reminded that the Government had introduced a temporary ban on exporting gold and gold-bearing rock. The ban gets extended every 6 months. The current ban is valid until summer and is going to be further extended. The ban is in place to ensure the domestic gold refineries fully use their capabilities. According to Mr. Rau, the three gold refineries are the ones owed by KazZinc and Kazakhmys and the recently launched refinery in Astana, the latter’s capabilities standing at 25 tons of gold. Last year the Astana-based facility alone processed over 10 tons.
The temporary exports ban is not applied to the Customs Union member states. “Certain gold mining companies with their respective parent companies based in Russia do export crude gold to Russia, however the volume is insignificant. The overall gold production in Kazakhstan stands at 50 tons, with 20 tons being processed by KazZinc, another substantial part being processed by Kazakhmys, and 10 tons being processed in Astana. Only some insignificant amount is being exported to Russia”, he said.
The Vice Minister emphasized that even if gold-bearing rock is exported to Russia to be processed, the country’s National Bank still enjoys the pre-emptive right to purchase the refined gold. “The Company has to bring the processed gold back to Kazakhstan. That’s is why it makes sense to make careful estimations”.