Armenian government provides Lydian Armenia with budget guarantees to receive a loan of up to $150 mln.
YEREVAN, February 27. /ARКА/. The Armenian government approved a decision at a meeting on Thursday, according to which Lydian Armenia will be provided assistance in obtaining credit funds.
In particular, the decision states that the government will provide a budget guarantee for the start of the exploitation of the Amulsar gold mine, which will allow the company to attract credit funds from the Armenian banking sector in the amount of up to $150 million with a repayment period of up to 5 years.
At the same time, as a precondition for issuing the guarantee, it is stipulated that it will be provided if, within 6 months after the decision comes into force, the company submits to the Ministry of Finance a report on the assessment of the market value of the assets and reports approved by an independent audit company, confirming that the amount of the guarantee does not exceed 20% of the market value of the assets.
Earlier, Armenian Minister of Economy Gevorg Papoyan said the launch of the Amulsar mine was planned for October 2025.
Hayk Aloyan, CEO of Lydian Armenia (the company holding the license to operate the Amulsar gold deposit), stated earlier that 70-80% of the work needed to begin operations at the mine has already been completed, and approximately $250 million is required to finish it.
"We have already raised $100 million, and we intend to secure the remaining $150 million from several local banks," said Aloyan.
According to him, Lydian Armenia plans to produce around 210,000 ounces of gold annually, which, at current global prices, would generate $500 million in revenue and $120 million in tax payments.
On December 27, 2024, an agreement was signed at the Ministry of Economy of Armenia, transferring 12.5% of Lydian Armenia's shares as a gift to the Armenian government.
The Amulsar gold deposit is the second-largest pure gold deposit in Armenia, containing approximately 31 million tons of ore and 40 tons of pure gold. It is located in the southeast of the country, 13 km from the resort town of Jermuk, in the interfluve of the Arpa and Vorotan rivers.
Lydian Armenia (founded in 2005, (a 100% subsidiary of Lydian Canada Ventures, which is owned by the American Orion Mine Finance and Canadian Osisko Gold Royalties) has been unable to fully exploit the Amulsar mine in recent years due to protests from environmentalists and residents of nearby areas. They are concerned that mining operations could lead to the pollution of Jermuk's groundwater and Lake Sevan, causing an environmental disaster.
In 2018-2019, and again in 2020, protests were regularly held, demanding that work be halted. In August 2021, the Armenian Investigative Committee presented the final expert opinion from Earth Link & Advanced Resources Development (ELARD) within the framework of a criminal case initiated on July 20, 2018. According to the Investigative Committee, there are no environmental threats from the mine's operation, and the potential risks can be managed if appropriate measures are taken.-0-
