By Mark Dovich
The Armenian government has again delayed plans to take partial ownership of the long-stalled Amulsar Gold Mine project.
The arrangement was initially set to be finalized by March 22 of this year, but that was later pushed back to September 1. It has now been delayed to November 1, according to a copy of the agenda for Prime Minister Nikol Pashinyan’s weekly cabinet meeting Thursday, which was obtained by CivilNet’s investigative reporting team.
What’s the background?
Amulsar, Armenia’s second biggest gold deposit by volume, has been embroiled in environmental and political controversy for years.
The mine’s operator, Lydian Armenia, first broke ground at Amulsar in 2016, but development was suspended for several years starting in 2018, when activists and residents of nearby communities began staging blockades of the mine entrance, citing environmental concerns.
Then last February, the Armenian government inked a surprise $250 million memorandum of understanding with Lydian and the Eurasian Development Bank to revive the project. As part of that deal, the EDB pledged to loan $100 million to Lydian, while Lydian agreed to hand over a 12.5% stake in the project to the Armenian government.
But even after a year and half, a formal timeline for the mine to begin production has still not been made public.
Denis Ilin, a high-level official at the Russia-led, Kazakhstan-based EDB, suggested in June that operations at Amulsar may begin as soon as next spring, in a rare public indication of a timeline for the project. That lines up with earlier remarks by Babken Tunyan, a senior Armenian lawmaker, who said in April he expected production to start “at the end of this year or the beginning of next year.”
Lydian, which is ultimately owned by private equity firms in Canada and the United States, has not commented publicly on the matter.
Vahan Kerobyan, who served as Armenia’s economy minister when the deal to revive Amulsar was struck, said in January the government stands to make up to $104 million every year if the mine is finally put into operation.
Why the delay?
As of now, it remains unclear why the Armenian government has yet to take its minority stake in the project.
The cabinet meeting agenda cites only unspecified “technical problems” and a corporate restructuring at Lydian. It provides no other details.
Those are the same reasons Pashinyan’s office cited in June when it first emerged that the plans had been pushed back to September.
Lydian did not immediately comment on the news. A prior CivilNet inquiry to Lydian to clarify what those “technical problems” are went unanswered.
What’s the context?
Under Pashinyan, the Armenian government has moved to take substantial minority stakes in a number of large and strategically important enterprises, often in unclear circumstances. Aside from Amulsar, that also includes the Zangezur Copper-Molybdenum Combine, Armenia’s largest mine, and Viva-MTS, a major telecommunications company.
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.
