Centerra Gold said union miners working at its Kumtor operation in the Kyrgyz Republic have initiated an illegal strike. Production at the operation has been suspended. The trade union is demanding that Kumtor pay the mandatory employee contribution to the Kyrgyz Republic social fund in addition to the mandatory employer contribution paid by Kumtor.

Recent regulatory changes now require social fund contributions be deducted from wages including premium payments for work at high altitude. Centerra believes this work stoppage is illegal as there is a collective agreement in place through December 31, 2012. The company is in discussions with the union to resolve the strike.

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