By Emil Danielyan
A U.S. company mining gold in Armenia said on Friday that it will carry on and even expand its activities despite Environment Minister Vartan Ayvazian’s controversial decision to revoke two of its operating licenses. Ashot Poghosian, head of the Armenian branch of Global Gold Corporation, told RFE/RL that the Armenian authorities have refrained from enforcing the decision, insisting that it is illegal and results from corruption allegations made against Ayvazian by the Connecticut-based company.
Earlier this year, Ayvazian’s ministry unilaterally terminated Global Gold’s licenses to carry out exploratory work at two gold deposits, accusing it of failing to honor its investment commitments.
Global Gold has strongly rejected the accusations and argued that the ministry’s actions contradicted an Armenian law regulating mining. An article of the law stipulates that local and foreign mining companies can not be stripped of their licenses without a court ruling. Furthermore, the Environment Ministry can take such firms to court only threes months after formally notifying them of an alleged violation of their contractual obligations. Global Gold executives insist that they have received no prior warnings from the authorities.
“International lawyers hired by our company have pointed to this fact in a recent letter to the Environment Ministry and received no objections from the ministry,” said Poghosian. “So under the existing law, all of our licenses remain valid. Therefore, our company is continuing to operate and make investments according to plan.”
“The law makes it clear that the licenses can be revoked only after an appropriate court ruling. Declaring the licenses null and void without such a ruling is a mere allegation that has no legal force,” he added.
Global Gold said in a recent statement that unnamed Armenian government officials have privately confirmed the “continuing validity of the licenses.”
Reports in the Armenian press have cited Global Gold sources as saying that Ayvazian moved against the company after it refused to pay a $3 million bribe allegedly demanded by him. The company has declined to publicly confirm or deny this, saying only that it has been the “subject of corrupt and improper demands and threats” from Ayvazian. “The Company has reported this situation to the appropriate authorities in Armenia and in the United States,” read its statement.
Prime Minister Andranik Markarian confirmed last month that U.S. diplomats in Yerevan have raised the issue with the authorities in Yerevan. But he insisted that the corruption accusations are baseless.
Foreign investors doing business in Armenian have long complained about endemic government corruption, but it is apparently the first time that one of them is openly implicating a member of the ruling cabinet in bribery.
Global Gold has the exclusive right to mine gold and other non-ferrous metals in four mountainous locations across Armenia. It is due to start extracting and processing gold ore on an industrial scale at one of those mines later this year.
The company claims to have created about 200 jobs and invested $8 million in those deposits over the past two years. According to Poghosian, it will invest another $2 million before the end of this year. Most of the reported investments have been channeled into exploratory work.
Global Gold’s most recent Armenian acquisition, announced last January, is a vast plot of land in the northeastern Gegharkunik region which geologists believe is rich in uranium and, to a lesser extent, gold.