By Atom Markarian
Armenia's largest copper company announced on Wednesday that it will soon obtain millions of dollars in credit from the European Bank for Reconstruction and Development (EBRD) that will allow it to expand dramatically.
The chief executive of the company called Armenian Copper Program (ACC), Valeri Mejlumian, said an agreement with the EBRD will be signed within a month but declined to specify the amount of the commercial loan. He said only that the funds will make up a considerable part of $18 million capital investments which ACC expects to attract in the coming years.
ACC's main asset, a huge factory in the northern town of Alaverdi, has seen a major production slump over the past decade, struggling to remain afloat since the Soviet collapse. The company, which privatized the Alaverdi factory five years ago, has recently draw up an ambitious expansion program for the next 15 years. It envisages, among other things, to increase the annual production of copper from the current 9,000 metric tons to 40,000 tons by 2007. Mejlumian said the EBRD loan will be crucial for the program's implementation.
The Alaverdi plant smelts copper ores extracted and processed in southeast Armenia by the state-run Zangezur Copper and Molybdenum Factory -- the number one employer in the area. According to some press reports, the Armenian government has decided to privatize the concern for an estimated $100 million. Industry sources say Russia's Norilsky Nikel giant is showing interest in the factory.
Mejlumian said the possible sale of the Zangezur mines to a foreign copper manufacturer is prompting ACC to look for alternative sources of ore in Armenia and Nagorno-Karabakh. He said his company will invest $3 million in its recently created Karabakh subsidiary that began developing copper and gold reserves in the region's northern Martakert region two months ago.
ACC, which exports its main product to western Europe, also plans to start purchasing scrap metal from neighboring Georgia, Mejlumian added.