Kyrgyz government to defend Centerra deal in court

BISHKEK, May 13 (Reuters) - The Kyrgyz government will defend its agreement with Canada's Centerra Gold (CG.TO: Quote, Profile, Research, Stock Buzz) following a court ruling this week that suspended the deal, Kyrgyz Prime Minister Igor Chudinov said on Tuesday.

Kyrgyzstan and Centerra's main shareholder Cameco (CCO.TO: Quote, Profile, Research, Stock Buzz) agreed last year on the details of their joint development of Kumtor, the Central Asian state's largest gold mine.

But on Monday, the Supreme Court suspended several agreements and licences related to the deal, following a lawsuit by a local official who called the deal illegal.

"I have ordered the (state) Geology Agency to file documents to challenge this ruling," Chudinov told reporters after visiting Kumtor, the largest industrial enterprise in the former Soviet nation.

Centerra has been waiting for parliament to pass the tax and ownership agreement which would give Kyrgyzstan a bigger stake in Centerra while firming up the company's hold on the mine.

Kubanychbek Isabekov, vice speaker of Kyrgyzstan's parliament, filed a lawsuit in early 2008 after calling that deal illegal. The suspension will remain in place pending the Supreme Court trial.

The ownership deal, which would see Cameco's stake in the company fall to 40 percent while the government's stake would double to about 31 percent, is seen as essential to quelling lingering fears that the government might nationalise the mine. (Reporting by Olga Dzyubenko; Writing by Olzhas Auyezov, editing by Will Waterman)