Auditing chamber asks government to halt development of two gold mines in Armenia
06.11.2010,
01:50
Armenia’s Auditing Chamber has asked the government to consider halting the development of Sotk and Meghradzor gold mines by GeoProMining company, Ishkhan Zakarian, head of the Auditing Chamber, told a news conference today.
YEREVAN, November 5, /ARKA/. Armenia’s Auditing Chamber has asked the government to consider halting the development of Sotk and Meghradzor gold mines by GeoProMining company, Ishkhan Zakarian, head of the Auditing Chamber, told a news conference today.
He said the Chamber has also asked the government to look into illegal development of these mines by GeoProMining in 2004-2008 without a license and to hold accountable government officials who were supposed to oversee this area.
Ishkhan Zakarian said the inspection at both mines revealed a string of grave breaches. He recalled that GeoProMining became the owner of Ararat Gold recovery plant which owns the mines. Under the law a company owner change must be followed by taking stock of all reserves in the deposits and submitting the conclusion to the government, which had not been done.
Under the contract the company committed to extract also 600,00 tons of ore annually at Sotk mine, but failed. In 2007 it produced only 16,000 tons, 29,000 in 2008 and 320,500 tons in 2009. The same is true regarding the Meghradzor mines.
It was revealed also that GeoProMining failed to transfer 24.1 million Drams of concessional payments to the government.
Zakarian said 100 shares of GeoProMining are secured at VTB Capital plc in favor of Carlow BV company which in 2010 June received a $250 million loan from the bank. He said no penny of this loan was invested in development of Armenian minesHead of the Auditing Chamber was also surprised that as the price of gold was rising for years the company was operating with losses. In 2007 they amounted to 16 billion Drams, in 2008 to 17.2 billion Drams and in 2009 to 11.6 billion Drams.
GeoProMining is an international privately-owned diversified metals resource holding company with a portfolio of exploration and mining projects. The company was founded in 2001 and is focusing on gold, silver, copper, molybdenum, antimony and other metals. Its
major assets in Armenia are GPM GOLD, developing Sotk gold mines in Gegharkunik province, Ararat gold recovery plant and Agarak copper and molybdenum combine. -0-
He said the Chamber has also asked the government to look into illegal development of these mines by GeoProMining in 2004-2008 without a license and to hold accountable government officials who were supposed to oversee this area.
Ishkhan Zakarian said the inspection at both mines revealed a string of grave breaches. He recalled that GeoProMining became the owner of Ararat Gold recovery plant which owns the mines. Under the law a company owner change must be followed by taking stock of all reserves in the deposits and submitting the conclusion to the government, which had not been done.
Under the contract the company committed to extract also 600,00 tons of ore annually at Sotk mine, but failed. In 2007 it produced only 16,000 tons, 29,000 in 2008 and 320,500 tons in 2009. The same is true regarding the Meghradzor mines.
It was revealed also that GeoProMining failed to transfer 24.1 million Drams of concessional payments to the government.
Zakarian said 100 shares of GeoProMining are secured at VTB Capital plc in favor of Carlow BV company which in 2010 June received a $250 million loan from the bank. He said no penny of this loan was invested in development of Armenian minesHead of the Auditing Chamber was also surprised that as the price of gold was rising for years the company was operating with losses. In 2007 they amounted to 16 billion Drams, in 2008 to 17.2 billion Drams and in 2009 to 11.6 billion Drams.
GeoProMining is an international privately-owned diversified metals resource holding company with a portfolio of exploration and mining projects. The company was founded in 2001 and is focusing on gold, silver, copper, molybdenum, antimony and other metals. Its
major assets in Armenia are GPM GOLD, developing Sotk gold mines in Gegharkunik province, Ararat gold recovery plant and Agarak copper and molybdenum combine. -0-
