EcoLur
Amulsar gold mining project in Vayots Dzor Region, Armenia, is implemented by Lydian International LLC registered in the offshore zone of Britain Virgin Islands. The main shareholders are directors and top managers of the company - 8.00%, International Finance Corporation, IFC, - 8.1% shares and the European Bank for Reconstruction and Development, EBRD, - 6.9% shares. In Armenia Lydian is represented by a local company, “Geoteam” CJSC - 100% owned by Lydian.
Lydian International plans to develop Amulsar gold mine in open pit mining with 0.9 grams of gold per ton and to process gold ore with heap leach technology.
What in Amulsar project makes public concerned
The public is concerned with the processes going around Amulsar and high risks of the project, as well as involvement of influential lobbyists in the Amulsar process, such as Prince Charles, Armenian Ambassador to Great Britain Armen Sargsyan, Ambassadors of the UK and USA to Armenia Katherine Leach and John Heffern, funding organizations – International Finance Corporation and European Bank for Reconstruction and Development. The government’s ambiguous position towards the project also causes concerns in this extremely politicized situation.
Recently Lydian informed that Energy and Natural Resources Ministry of Armenia extended the deadline for the completion of the Company's open pit construction and capital mining works to September 26, 2018. At the same time, the Nature Protection Ministry tables newer and newer conditions not refusing the company in granting positive opinions. As a result, the company has been granted two positive opinions of the environmental expertise, but both conclusions are expired.
At first, the actions of Nature Protection Ministry were open, while the public was invited to public hearings. Now the negotiation process is gradually becoming non-transparent and getting to the level of other governmental bodies. Particularly, upon the Prime Minister’s order, a working group was established in August 2013, which should determine, whether or not the construction area of the heap leap facility is within the new borders of Lake Sevan catchment area. Reminder: the company had to change the construction area of the heap leap facility twice because of the government resolution on specification of Lake Sevan catchment area.
It’s noteworthy that the working group was established not by the Nature Protection Ministry, which bears direct responsibility for the preservation of Lake Sevan, but the Economy Ministry, which doesn’t have any body performing any functions of expertise or preservation of Lake Sevan.
EcoLur’s enquiry about the results of the performance of the working group and specification of final borders of Lake Sevan catchment area was left unanswered by the Economy Ministry. After several months Lydian International Company published information on its website that “arrangements were reached that the location of the heap leap facility is admissible for both parties – government and company.”
Non-transparency of information is supported by the International Finance Corporation, IFC, a part of World Bank. EcoLur has addressed two applications to IFC on Amulsar project, which particularly said: “…the activities on Amulsar project don’t comply with the following IFC standards: 1. on ensuring environmental and social sustainability, 2. on rational use of resources and prevention of environmental pollution, 3. on health protection and population safety. We think that IFC, having commitments in standard performance, should suspend its participation it Amulsar project unless these standards are performed.” Nevertheless, IFC didn’t reply them.
The information about Amulsar project risks is available not only in the comments and opinions of independent experts, scholars and public. The Scientific-expert Committee on Lake Sevan Preservation gave its negative assessment to Amulsar open gold mining project, while its authorities are prescribed in RA Law “On Lake Sevan”.
1. Pollution of the main water resources in Armenia with dumps and wastes, first of all, Lake Sevan, which is a strategic object of freshwater for the Caucasus with its reserves of 35 billion cubic meters, two reservoirs – Kechout and Spandaryan and Arpa and Vorotan Rivers.
2. Radioactive pollution with uranium and thorium, because Amulsar uranium mine in located next to Amulsar gold mine, in a distance of 4-5 km from Amulsar Mountain. Provisional uranium reserves make up 75 tons, and 100 tons taking into consideration thorium. The opinion of the Scientific-expert Committee on Lake Sevan Preservation says the same, “...The reports of Radman Associates show that radon concentration exceeds the 400 Bq, but the project EIA doesn’t say anything what measures to be undertaken to reduce this level…” (http://www.geoteam.am/media/documents/Technical%20Reports/Impact%20Assessment%20Reports/Radioactivity_Impact_Assessment_Radman.pdf)
For our part we would like to mention that Radman Associates is not entitled to investigate the uranium reserves to determine the ranges of radiation hazard, as under the government resolution (N234 dated on 06.03.2008, “On Establishing “Armenian-Russian Mining Organization” CJSC), uranium exploration is the monopoly of Armenian-Russian Mining Organization. Only this company is entitled to specify the ranges of safety.
3. Risks for Jermuk Resort and loss of mineral waters in Jermuk. Jermuk is located in a distance of 12 km from Amulsar. Under the government decision “On Declaring Jermuk Town as a Tourism Center” № 1064-N dated on 18.09.2008, Jermuk was recognized as a tourism center, which should develop towards international recreation resort. Jermuk is famous for the production of “Jermuk” bottled mineral water, which is also exported. Millions of investments have been made into Jermuk. Under Jermuk Development Plan, the border of tourism zone approaches Amulsar in a distance of 2-4 km. However, explosions and dust of an open pit mining, water and soil intoxication because of over 90 million tons of tails (70 million tons without overburden) and a heap leap facility will have its adverse affect on Jermuk brand, millions of investments and the resort itself. Besides, brittle mineral springs may get disappeared because of the consequences of explosions. That is, Jermuk has no future.
Geoteam Company insists that Jermuk is not within Amulsar project affected zone. But Jermuk, if to be precise, Kechout village, which is the administrative area of Jermuk resort, was included into the project in 2009 as approved by Nature Protection Ministry of Armenia. Thus, the project affected zone included Jermuk. The paradox is that Kechout disappeared from the list in the expanded project for 2012.
4. Risks of landslide processes and seismic risks are not taken into consideration. “… Explosives may activate landslip processes with their unpredictable consequences… The place for tail accumulation at the height of 2570-2360 meters is located in a distance of several kilometers to the epicenter of a disastrous quake in 735. The project doesn’t have any calculations and risk projections for a quake with a magnitude of 10….” says the opinion of the Scientific-expert Committee on Lake Sevan Preservation.
5. The animal and plant species inhabiting in Amulsar area are endangered. Under the data by WWF-Armenia, the following red-listed species have been detected in Amulsar and its adjacent areas: one plant species - Potentilla porphyrantha, two species of lizard, eighteen species of birds and four species of mammals.
The extent of risks means that the government must immediately reject Amulsar project. But the government played a double game. On one hand, in 2012 the government signed a resolution on Amulsar project, on the other hand, after one year it reached a resolution about the specification of the borders of Lake Sevan catchment area, which at once changed the positive vector of the project implementation.
In this regard, Nature Protection Minister Aram Harutyunyan’s statement in the course of the final press conference on 27 December 2013 is particularly noteworthy: the Minister didn’t mention the negative opinion of the committee, he didn’t cover radiation pollution risks, though in 2007 it was Minister Harutyunyan, who signed the draft decision on the exclusive monopoly of Armenian-Russian Mining Organization over geological prospecting and development of uranium reserves in Armenia (including Amulsar). He didn’t mention anything about the loss of unique mineral water mines in Jermuk, though Jermuk hydrological reserve is under the protection of the Ministry, as a specially protected area.
Here is what the Minister said, “Amulsar project should be the best among the world’s environmental projects, i.e. top hi technologies should be used, and environmental measures should be the best, while emissions and damage caused to environment should be minimum.”
“What about Jermuk, We had 2-3 discussions concerning Amuslar project, where Jermuk Town was involved in the discussions and hearing with my assignment and due to our correspondence with Jermuk Town. I phoned them and told them to come, participate and table their proposals. I propose and assign to hold hearings at the ministry not to have any kind of restrictions,” Minister Harutyunyan said.
Meanwhile he didn’t mention that the opinions of Jermuk residents gave no legal grounds towards Amulsar project without official involvement of Jermuk in the list of project affected communities, for example, calling upon court.
He also didn’t mention what kind of modern and highest technologies may be used in open cast mining and heap leach technologies, when Europe has refused from cyanic technologies, while open cast mining means crushing mountains with explosions, million tons of wastes and the rest mentioned above.
In our opinion, the official bodies didn’t hinder investing money into Amulsar project waiting when the project will get into its active stage of getting profit from stock exchange transactions, mining and gold sale. At this very stage the real negotiations were launched putting forward conditions for making transactions. It’s clear that always somebody stands behind gold and it’s not the level of an ordinary official.
A question: which are proposed conditions, whether the investors as represented by financial development institutions are ready to accept these conditions and whether they can sacrifice invested 60-70 million not to conclude any suspicious transactions? We will get the answer in 2014, when the company will proceed to the next stage of constructing infrastructures and development of Amulsar mine.
January 14, 2014 at 13:42