EcoLur
Mr. Howard Stevenson, President and Chief Executive Officer of Lydian International Company, stated at the Annual Meeting of the European Bank for Reconstruction and Development (EBRD) on 15 May in Tbilisi that around US $ 488 million will be paid to the budget of Armenia in the form of taxes and royalties during Amulsar gold mining project.
We will consider this statement from the position of Lydian’s main shareholders, EBRD and International Finance Corporations (IFC). The question is that Lydian President most probably hurried to make such a statement, as the EBRD and IFC still didn’t make any decision on funding the development stage of Amulsar project.
At the EBRD Annual Meeting in Tbilisi, the bank top managers outlined many times that they funded only the investigation stage of the project and not the development stage. Darius Pracek, Director of Project Appraisal at EBRD, Riccardo Puliti, Managing Director, and Lisa Rosen, Chief Compliance Officer, outlined in the course of the meeting that the bank funded only the investigation stage of Amulsar project. At the same time, they said they don’t exclude that the project category can be changed from B, where risks are considered controllable to A, where uncontrollable risks are considered, when deciding on funding the active stage of Amulsar project (i.e. development and gold extraction).
Taking into consideration the situation, if the EBRD starts considering the project as Category A, it will have to refuse from its shares in the chartered capital of the company. Currently the bank owns 6.9% shares. If the bank decides not to change the category of Amulsar project, the Compliance Office will have to proceed to consider the risks on Amulsar in the extent laid down in the applications they turned down (public representatives, local residents and representatives Lake Sevan drainage basin communities).
Reminder: public representatives, Gndevaz Village residents and representatives Lake Sevan drainage basin communities lodged three different complaints to the Project Complaint Mechanism of the EBRD on Amulsar project. Nevertheless, the office refused to consider these complaints pointing out that no decision was made to fund the development of the mine. In case of the complaint lodged by Sevan drainage basin communities they said that the project area is extended without any grounds.
June 01, 2015 at 14:24