Armenian Economy Minister shares plans to develop Amulsar gold mine after EDB withdraws from the project
YEREVAN, 12 December. /ARKA/. Armenian Economy Minister Gevorg Papoyan shared today plans regarding the restart of the Amulsar gold mine after the Eurasian Development Bank (EDB) withdrew from the project.
‘After the EDB withdrawal from the project, Armenian commercial banks may assume its share of investment in the project. Negotiations are now underway between the owners of the mine and the banks. And if these negotiations are successful, and I hope so, the banks will provide the financing,' Papoyan said at a press briefing on Thursday.
He added that the banks have accumulated quite an impressive capital in recent years, which allows them to finance projects worth up to $150 million.
‘Such a thing, of course, was impossible to imagine a few years ago. However, now it is quite possible. There are also certain issues related to risk containment,’ the minister said.
Papoyan added that in order to better assess the risks associated with the Amulsar project, the Ministry of Economy has ordered a study from an auditing company, which is expected to arrive within a week.
In February 2023, Armenia, EDB and mine owner Lydian Armenia signed a Memorandum of Understanding, according to which the parties were to attract about $150 million and another $100 million outside the framework of this document for the development of the Amulsar mine. According to the memorandum, the EDB was to provide a $100 million loan and another $50 million were to be provided by a local bank.
Earlier this month EDB Board Chairman Nikolai Podguzov said that the bank was ready to participate in the project, but the application for financing the project was declined.
Earlier, Gevorg Papoyan said that mining at the Amulsar gold mine may be launched at the end of 2025.
Amulsar gold mine is Armenia's second–largest gold mine in terms of pure gold reserves. It is located in the southeast of the country, 13 km from Jermuk resort town, between rivers Arpa and Vorotan. The deposit is said to contain about 31 million tons of ore and 40 tons of pure gold.
Lydian Armenia (established in 2005, a 100% subsidiary of Lydian Canada Ventures owned by the American Orion Mine Finance and Canada's Osisko Gold Royalties) was until recently unable to develop the mine in full due to protests by environmentalists and residents of the neighboring communities.
They were concerned that the operation of the mine may lead to the pollution of underground waters of Jermuk and Lake Sevan, causing an environmental disaster.
In August 2021, the Investigative Committee of Armenia published the final expert report commissioned to Earth link & Advanced Resources Development (ELARD) in the framework of a criminal case initiated on July 20, 2018. According to the Investigative Committee, there were no environmental threats from the operation of the mine, and the likely risks could e controlled if appropriate measures are taken.
The Armenian government is to own 12.5% of the company and provide insurance for the transaction against certain risks. Neighboring communities are to receive $7 million annually in support from the company. -0
