International Finance Corporation of World Bank (IFC) Refused from Funding Lydian International's Amulsar Project

International Finance Corporation of World Bank (IFC) Refused from Funding Lydian International's Amulsar Project


International Finance Corporation of World Bank Group, (IFC), refused from funding Lydian International's Amulsar Project, as the letter addressed to Osvaldo Gratacós, Vice President and CAO, says. The IFC's letter is, as a matter of fact, is a response to the Ombudsman's report on the complaints lodged by the NGOs and the residents of the local communities affected by Amulsar open gold mining and heap leaching project. The complainants were demanding from the IFC to pull out of this project, as it doesn't comply with the IFC standards and requirements.

In the course of the complaint consideration, the CAO experts visited Armenia several times, had meetings with the NGOs and the local residents from Gndevaz Village and Jermuk Town, who signed under this complaint, as well as with the representatives of Lydian Company. The experts submitted the risks of Amulsar project in regard to the loss of Jermuk resort because of its immediate proximity of expected sites of industrial wastes to the resort and the dust with the mixtures of heavy metals from the gold mining area. The risks of the pollution of water basins of Arpa and Vorotan were presented and through them stands out Lake Sevan, which is the largest water resources with potential drinking water with a volume of 37 billion cum. The risks of heap leaching near the houses of Gndevaz villagers were presented, as well as risks of pollution to their pastures, meadows, air, threats for health. The risks to the loss of biodiversity in the areas of Amulsar project were also presented.

In the course of the entire duration of the complaint, which lasted around 3 years, Amulsar project was amended, the lost of project affected communities grew larger and new independent expert assessments on the socio-economic impact of Amulsar project appeared. Nevertheless, the ISIA of the company didn't reflect these risks stating the risks are under control and the consequences will eliminated. Receiving the CAO report for 2017, the complainants didn't agree with the formulation of the report and send a letter on this regard to CAO/IFC. (  

In its turn, the IFC also responded to the letter, which says though Amulsar project is a flagman project and the project will improve the economic situation in Armenia, nevertheless, 'IFC’s investments initially funded exploration works in a number of countries, and from 2010 onwards, continued exploration and feasibility studies for Lydian’s flagship Amulsar project, while supporting the company in improving its E&S management practices. Given that Lydian has succeeded in attracting funding for mine development from private sector sources, IFC has divested its investment in Lydian, as we seek to deploy our capital where it is needed most to foster sustainable economic development. IFC is therefore no longer overseeing mine development,' the IFC letter says.

September 14, 2017 at 16:57