New Kyrgyz mining code ready by July-govt official

LONDON, May 7 (Reuters) - A new, investor-friendly mining code for Kyrgyzstan will be enacted by the country's parliament by July, a government official said on Wednesday.

The Central Asian republic, with deposits of gold and coal as well as exotic metals antimony and mercury, wants to take advantage of high metal prices on world markets, and strong demand from neighbouring China.

"We consider (the current mining laws) out of date," said Kapar Kurmanaliev, Director of the State Agency on Geology and Mineral Resources.

"Parliament will pass the new code by June or July at the latest," he told a briefing.

The new code will reduce the tax payable by mining firms, make it more difficult for the government to revoke mining licences once granted, and reduce the degree of government involvement in approving mining projects.

"The mining industry accounts for around 11 percent of our GDP," Kurmanaliev said. "With the growth of the world market, if we intensify the pace of working with our natural resources, this will lead to continuous growth in the sector."

Gold <XAU=> traded at around $870 per ounce on Tuesday, about $200 higher than its price 12 months ago, but below the all-time high of $1030.80 it hit in March.

Canadian-listed mining firm Centerra Gold (CG.TO: Quote, Profile, Research) hopes Kyrgyzstan will ratify its ownership of the Kumtor gold mine when parliament convenes on May 29 to consider the issue.

"In principle, all the questions between the government and Centerra have been agreed, and now we are working on how to reflect all our agreements on paper," Kurmanaliev said.