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U.S.-Based Firm Gears Up For Gold Mining In Armenia


Armenia - The U.S.-based company Lydian International builds a gold mine at the Amulsar deposit, 9Dec2017. (Photo by Lydian Armenia)

A U.S.-British company said on Monday that it expects to finish next year the ongoing construction of a massive gold mine in Armenia that will sharply increase the country’s gold exports.

The company, Lydian International, started building its gold mining and smelting facilities at the Amulsar deposit in the southeastern Vayots Dzor province in August 2016 after years of preparation and a licensing process administered by the Armenian government. It has since hired more than 1,000 Armenian workers for the construction which it says will cost $370 million in investments.

“We are constructing the mine and we are about half way through the construction,” Howard Stevenson, Lydian’s chairman and chief executive, told RFE/RL’s Armenian service (Azatutyun.am) in an interview.

Stevenson said the company has already become Armenia’s 19th largest corporate taxpayer. “Amulsar’s success will also be a success for Armenia because our positive economic impact on this country will be significant,” he said.

Hayk Aloyan, the executive director of Lydian’s Armenian subsidiary, said last month that the company plans to produce 210,000 ounces of gold annually, which will be worth over $260 million at current international prices.

According to government statistics, Armenia exported around $100 million worth of gold in 2015. The bulk of that export revenue, equivalent to 6.5 percent of overall Armenian exports, was generated by a Russian company operating big gold mines at Sotk, eastern Armenia. The company, GeoProMining, also owns a gold processing plant in Ararat, a small town 50 kilometers southeast of Yerevan.

The Armenian government gave the green light for the Amulsar project despite strong opposition from local environment protection groups which say that it poses a serious threat to the local ecosystem and livelihoods of farmers living in nearby villages. They also point to the gold deposit’s proximity to Jermuk, the country’s most famous spa resort.

Armenia- Lydian International CEO Howard Stevenson speaks to RFE/RL in Yerevan.
Armenia- Lydian International CEO Howard Stevenson speaks to RFE/RL in Yerevan.

Stevenson, whose company is registered in a British tax haven but headquartered in the U.S. state of Colorado, sought to allay those fears. He insisted that the forthcoming mining operation is a “zero emissions project” that will use advanced technology and meet environmental standards. “Our project will have no impact on water resources in the area and on Jermuk as well,” he said.

Stevenson also ruled out any potential impact on Armenia’s ecologically vital Lake Sevan which is fed by one of the rivers flowing through Vayots Dzor. “There is no risk that even if we have an industrial accident we would impact Lake Sevan,” he said.

Levon Galstian, one of the environmentalists fiercely resisting the project, dismissed these assurances. He insisted that with the kind of technology that it is planning to use Lydian cannot guard against contamination of soil and water with toxic waste from the Amulsar mine. That will put Jermuk’s famed resorts and mineral water industry at serious risk, Galstian told RFE/RL’s Armenian service (Azatuyun.am).

The U.S. and British governments strongly support the Amulsar project. The U.S. ambassador to Armenia, Richard Mills, said earlier this year that it has been deemed “fully compliant” with environment protection standards set by the World Bank and the European Bank for Reconstruction and Development (EBRD).

A senior EBRD executive said in August 2016 that that Lydian has committed itself to meeting “the strictest environmental conditions” set by the London-based lending institution.

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