By Mark Dovich
Operations at Amulsar, a long-stalled gold mining project embroiled in environmental controversy, may begin as soon as the end of the year, an Armenian official indicated this week.
“The Amulsar mine is expected to start production at the end of this year or the beginning of next year,” lawmaker Babken Tunyan said Wednesday, providing the clearest timeline to date on when operations at the mine may begin after years of delays.
There was no immediate comment from Lydian Armenia, the company with the rights to the mine.
What’s the background?
Lydian broke ground at Amulsar in 2016, but development was suspended for several years amid protests by residents of nearby communities and environmental activists.
The Armenian government moved to revive the project last year, signing a $250 million memorandum of understanding with Lydian and the Russia-led, Kazakhstan-based Eurasian Development Bank. In return, Lydian agreed to hand over 12.5% of its shares in the mine to the Armenian government. The government formally took its stake in the project earlier this year.
Lydian is ultimately owned by private equity firms in Canada and the United States, and the U.S. embassy in Yerevan has described Amulsar as “one of the biggest U.S. investments in Armenia.”
The Amulsar deposit is Armenia’s second biggest gold deposit by volume, after the Sotk mine. Operations at that site, which straddles the border between Armenia and Azerbaijan and is owned by a Russian company, have been largely suspended since last year amid repeated cross-border shelling.
Read more: Armenia’s largest gold mine partially closed over shelling from Azerbaijan
Vahan Kerobyan, who served as Armenia’s economy minister when the deal to revive Amulsar was struck, has said the government stands to make up to $103 million every year if the mine is put into operation.
Armenia has considerable deposits of copper, gold, and molybdenum, and the mining industry is one of the country’s biggest sources of employment and government revenue. Many of Armenia’s mines are controlled by Russian companies.
Lawmakers are currently debating a government proposal to introduce duties on exports of gold, palladium, and platinum. Armenia already collects royalties on exports of copper and molybdenum.
Also read: Armenia’s biggest mine says sanctions ‘don’t apply’ as US blacklists Russian operator
