More than 200 Armenian employees of a U.S.-based mining company demonstrated in Yerevan on Monday against the blockage of a massive gold deposit in southeastern Armenia which continued for a tenth consecutive day.
The Lydian International company, which had won exclusive rights to develop the Amulsar deposit, said it has suffered millions of dollars in losses and could take legal action if one of the largest business projects in Armenia’s history is disrupted.
All roads leading to Amulsar have been blocked since June 23 by a group of residents of nearby communities protesting against gold mining operations planned there. More than 1,400 people working there, many of them also local residents, have therefore been unable to go to work.
The protesters already twice blocked workers’ access to the site for several days in late May and early June. Prime Minister Nikol Pashinian urged them to end the protests. He said he will order government inspections of “all metal mines” in the country to verify and, if necessary, ensure their compliance with environment protection norms.
Pashinian criticized the renewed road blockade on June 25, warning that it could be deemed an act of “sabotage” against Armenia’s new government. He said Lydian must be allowed to resume its operations pending the findings of an ad hoc government task force that will start inspecting the mining company soon.
However, the protesters rejected the appeal, saying that Lydian must immediately halt the construction of its gold mining and smelting facilities at Amulsar, which was due to be completed this fall.
Pashinian said on Sunday that all government decisions regarding Amulsar will be based on “irrefutable facts.” He did not say whether he will order the Armenian police to forcibly unblock the mining site.
The Lydian employees led by senior company executives in Armenia marched to the prime minister’s office in Yerevan the following morning. They demanded urgent government action against what they see as an illegal obstruction of their company’s operations.
“As many as t 1,400-1,500 people earning a living there are now forced to stay at home,” said one of the protesting workers. “If our operations are illegal then let them find a solution to that. If they are legal, then the roads must be reopened so that the people can go back to work.”
“We have already suffered $5 million in losses in the last ten days,” Lydian’s chief executive in Armenia, Hayk Aloyan, told RFE/RL’s Armenian service (Azatutyun.am).
Aloyan insisted that Lydian, which is registered in a British tax haven but headquartered in the U.S. state of Colorado, is not yet considering suing the Armenian state for failing to meet its contractual obligations. He said the demonstration staged by Lydian employees was also a show of support for the Pashinian government’s stance on the Amulsar blockage.
Still, Aloyan did not rule out the possibility of legal action. “If we see that the matter is not solved through dialogue, we could appeal to other bodies and try to have our rights restored. But we will keep working with the government [for now.]”
Lydian started construction at Amulsar in 2016 after going through a lengthy licensing process administered by Armenia’s former government. It pledged to invest more than $400 million in the deposit and more than triple Armenia’s gold exports which stood at an estimated $100 million last year.
Gold production at Amulsar was due to start before the end of this year. It is not yet clear whether the continuing protests there will delay it.
Armenian environment protection groups are strongly opposed to the Amulsar project, saying that it would contaminate air and water in the mountainous area. Lydian maintains that it will use advanced technology to prevent any damage to the local ecosystem.
The mining project is strongly supported by the U.S. and British governments. The U.S. ambassador to Armenia, Richard Mills, argued last 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). The EBRD holds a minority stake in Lydian.
Mills apparently expressed concern over the disruptions when he met with Deputy Prime Minister Tigran Avinian on June 14. According to Avinian’s press office, the U.S. envoy “stressed the importance of the continuation of Lydian Armenia’s activities.”
According to the National Statistical Service (NSS), Lydian was the main source of $246 million in foreign direct investment attracted by Armenia last year.