Kyrgyz Gold Mine Set for Thorny International Bankruptcy Fight

A gold mine high in the mountains of Kyrgyzstan is testing the limits of U.S. bankruptcy law.

Kumtor Gold Co. filed for Chapter 11 bankruptcy in New York last week after the Kyrgyz Republic seized control of the company’s namesake mine. Centerra Gold Inc., Kumtor’s publicly traded parent, said it hoped the bankruptcy would kick-start negotiations with the Kyrgyz government, calling the seizure an “unlawful expropriation.”

The Kyrgyz Republic, however, thinks the bankruptcy is invalid and should be dismissed, a lawyer for the Central Asian nation said during Kumtor’s first Chapter 11 hearing Tuesday. The government took over the ...