The government of Uzbekistan has decided to liquidate bankrupt US-Uzbek gold mining joint venture (JV) Zarafshan-Newmont, a representative of Uzbekistan’s Navoi Ore Mining and Metallurgical Plant, or NGMK, said Wednesday.

After liquidation, assets belonging to Zarafshan-Newmont will be transferred to NGMK.

The liquidation procedure is to take about two months, the representative said.

Earlier, a liquidation commission in Uzbekistan failed for the fifth time to auction off the assets of bankrupt Zarafshan-Newmont due to an absence of bids at a starting price of US$140 million.

US miner Newmont Mining is expected to receive US$80 million for its 50% stake in the joint venture after liquidation.

Zarafshan-Newmont was established in 1992 on a parity basis between Newmont and NGMK.

In early October 2006, an Uzbek court declared Zarafshan-Newmont bankrupt. The ruling followed a US$49 million back tax claim by the Uzbek government and the subsequent seizure of some of the joint venture’s assets.

Zarafshan-Newmont develops the Muruntau open-pit gold mine, owned by NGMK. In 2006, Zarafshan-Newmont produced 7.192 tonnes of gold, down from 7.72 tonnes in 2005.

The joint venture is one of three gold producers in Uzbekistan.