Procurement strategy

To increase local procurement, KGC employees will follow standard operating policies and procedures in ethics, environmental protection, health and safety and other key areas.

It should be noted that, as with any other gold mining operation, the only thing we can control is the cost of production. Thus, it is important for us to consider the factors of market stability, quality and price of goods and services in our procurement. While one of Kumtor priorities is to procure goods on the local market wherever possible, it is very important to us that the goods and services of local suppliers meet the criteria.

To improve our local procurement performance, we have taken a number of measures including, for example, publishing our requirements in local newspapers and on our website and public procurement portal, making presentations on our procurement process, as well as identifying goods and services that can be purchased locally to replace those purchased internationally.

The Company will give preference to businesses in which citizens of the Kyrgyz Republic are the majority owners and, where possible, support businesses located closest to the mine. In doing so, KGC shall ensure that it does not contribute to the creation of new local and/or regional supplier enterprises if similar enterprises already exist in the country. Although KGC favours healthy competition among suppliers, the creation of additional enterprises to supply certain goods and services will lead to unsustainable demand, which will adversely affect all suppliers.

In all cases, Kumtor procurement guidelines shall apply to verify due diligence of the business owners. In addition, all enterprises (or organizations) wishing to conclude a contract with Kumtor shall fully comply with applicable Kyrgyz legislation and be qualified/accredited (link to the page – How to become a Supplier).