A multimillion-dollar gold mining project launched in Armenia by an Anglo-American company but disrupted a year ago does not pose serious environmental risks, according to an independent study commissioned by the Armenian government.
The company, Lydian International, started building a massive gold mine at the Amulsar deposit in the southeastern Vayots Dzor province in August 2016 after a lengthy licensing process.
All roads leading to Amulsar have been blocked since June 2018 by several dozen people protesting against gold mining operations there which they say would contaminate air, soil and water resources in the mountainous area.
Lydian, which claims to have already invested $400 million in the project, has dismissed these concerns, saying that it will use modern and safe technology. The company has repeatedly demanded an end to what it considers an illegal blockage. It openly threatened international legal action against the Armenian government in March.
Around that time, the government hired a Lebanese environmental consultancy, ELARD, to conduct an environmental assessment of what would be one of the biggest foreign investment projects ever implemented in Armenia. Prime Minister Nikol Pashinian and other officials have since indicated that Lydian’s renewed operations depend on the findings of that audit.
ELARD was specifically tasked with looking into the project’s potential impact on Jermuk, a famous spa resort located around 20 kilometers from Amulsar, and the more remote Lake Sevan.
The Investigative Committee on Wednesday publicized a 200-page report submitted to it by ELARD. The head of the law-enforcement agency, Hayk Grigorian, presented its key findings at a cabinet meeting held in Yerevan on Thursday.
Grigorian stressed, in particular, that the audit found that underground water at Amulsar has no physical “connections” with mineral water sources in Jermuk or rivers and canals flowing into Sevan. The ecologically vital lake might only be contaminated with “insignificant” quantities of toxic waste from Amulsar in case of a powerful earthquake, he said.
Gold mining poses greater environmental risks for other rivers flowing through Vayots Dzor, Grigorian went on. But they can be minimized if Lydian takes “mitigating measures” recommended by ELARD, he said, citing the study. The official added that the company is ready to take virtually all of those steps.
Grigorian further made clear that based on the audit the Investigative Committee has no grounds to indict anyone in its criminal inquiry into a government agency that gave the green light to the mining project in April 2016. The probe was launched in July 2018.
Speaking at the cabinet meeting, Pashinian said that the government will closely examine the ELARD report. He did not specify whether it will order law-enforcement authorities to forcibly restore Lydian’s access to the would-be mining site.
As Pashinian chaired the meeting about two dozen environmental activists rallied outside his office to warn the government against enabling Lydian to resume its operations. They insisted that mining at Amulsar would inflict severe damage on the country’s ecosystem.
The protesters demanded an urgent meeting with Pashinian. An aide to the prime minister told them that he will receive them later this month.
Meanwhile, Lydian cautiously welcomed the audit’s basic conclusions in a statement released on Wednesday. “We are relieved that the Audit Report has been made public, as the Government of Armenia has repeatedly conditioned Lydian’s ability to advance the Amulsar Project on its results,” the company’s interim chairman and chief executive, Edward Sellers, was quoted by the statement as saying.
“We look forward to reading the full text of the Audit Report and are confident it will confirm Lydian’s prudential approach to environmental stewardship,” added Sellers.
The Amulsar project has been supported by the U.S. and British embassies in Yerevan. U.S. diplomats have warned that continued disruption of Lydian’s operations could scare away other American investors interested in Armenia.
Lydian is registered in a British tax haven, headquartered in the U.S. state of Colorado and listed on the Toronto Stock Exchange. Its shareholders include U.S., Canadian and European investment funds as well as the European Bank for Reconstruction and Development.
The company planned to produce 210,000 ounces of gold, worth over $315 million at current international prices, annually at Amulsar. It also pledged to create about 800 permanent jobs and pay about $50 million in annual taxes.
Facebook Forum