Progress or disaster? Armenia begins operations at Amulsar mine
Operations begin at Amulsar mine
The Amulsar gold mine has begun operations in Armenia. Guests attending the official opening ceremony were shown the mining process and the production of the first gold bar. Prime Minister Nikol Pashinyan also attended the ceremony.
The Armenian government expects the project to generate $130m annually in tax revenue and other income for the state budget.
Environmental campaigners, who have warned about the risks associated with the project for years, condemned the government’s decision. More than 60 organisations issued a statement warning that mining at Amulsar would lead to an “irreversible environmental catastrophe”.
However, Prime Minister Nikol Pashinyan maintains that concerns about environmental risks have been comprehensively addressed. He insists that all questions raised by environmentalists have received thorough and conclusive answers, dispelling their fears.
“There were alarming statements and concerns, including about the possible poisoning of Lake Sevan and so on. And we are here today because we are convinced that none of these risks actually exist,” Pashinyan said.
Economist Suren Parsyan expects the development of the Amulsar deposit to bring significant economic and social benefits.
He also believes that the launch of the mine will demonstrate to investors that Armenia continues to operate in accordance with international standards and is ready to implement new projects.
- How Armenia is reacting to export restrictions on Russia: farmers’ views and official statistics
- Experts warn of pesticides in Armenian food, inspectors see no issues
- Preferential regime for Armenian exports to EU in response to Russian restrictions
$750m already invested in the project
The Amulsar mining project is being implemented as part of a strategic partnership between Lydian Armenia and the Armenian government.
According to the government, Lydian Armenia has:
- introduced international best practices and standards at Amulsar;
- adopted the principles of modern, responsible mining;
- promoted a new culture of occupational safety, environmental management, social responsibility and the use of modern technologies.
The company has already invested around $750m in the project.
The Amulsar mine is expected to produce approximately 210,000 ounces (around 6.5 tonnes) of gold annually.
“According to expert estimates, the annual taxes and other contributions paid by Lydian Armenia to the state budget as a result of the mine’s operation will amount to approximately $130m, contributing an estimated 1.5–2% to Armenia’s GDP,” the government said in a statement.
The project is also expected to create more than 4,000 direct and indirect jobs.
Under an agreement between the government and Lydian Armenia, the company will allocate 7m–9m annually to socio-economic development programmes in nearby communities throughout the mine’s operational lifespan.
Pashinyan: ‘Country is entering a new stage of development’
Armenian Prime Minister Nikol Pashinyan described the launch of operations at the Amulsar mine not only as a successful investment project but also as a new stage in the country’s development and an important milestone in the history of Armenia’s mining industry and economic development.
“In the context of Armenia’s history, this is a major step forward. But I hope and firmly believe that in the near future, such steps will become routine and part of our everyday practice. And what we consider a major step in the future will involve projects on an even larger scale.”
According to Pashinyan, the project will provide Armenia with greater opportunities to invest in the security and well-being of its citizens.
He stressed that the country’s mineral resources belong to the Armenian people and that the government’s key responsibility is to ensure that this wealth “serves the development and prosperity” of every citizen.
Nikol Pashinyan inspected the facilities and infrastructure developed for the operation of the mine.
The prime minister said that Lydian Armenia had imported modern equipment to develop the deposit. In his view, Armenia can now boast a high-quality mining industry:
“For any developed country, mining of this calibre, carried out in compliance with environmental and social standards, is a key driver of national development.“
‘Ignoring the risks is unacceptable’: Environmental NGOs’ statement
According to civil society representatives, they have still not received information about realistic and well-founded measures to address the environmental and socio-economic risks associated with the project.
They described the ceremonial opening of the mine just days before the 17th Conference of the Parties to the UN Convention on Biological Diversity (COP17), due to take place in Yerevan, as “a very bold and irresponsible step”.
“By hosting COP17, Armenia is seeking to demonstrate its commitment to the green agenda to the international community, while an environmental catastrophe is unfolding within the country. Armenia’s natural environment, water resources and the future of local communities cannot be put at risk without proper public accountability and evidence that the project is safe. We consider it unacceptable to ignore these risks,” the statement said.
Expert commentary
According to economist Suren Parsyan, Amulsar is the largest investment project in Armenia’s modern history.
In an interview with Armenpress, he said the Amulsar deposit had sufficient reserves to sustain mining operations for at least 20–25 years. He therefore believes that the mine will have a significant economic impact not only on nearby communities but also on the country as a whole.
Parsyan said the company’s turnover or exports would amount to around $930m, meaning that Armenia would gain a new “industrial giant” comparable to the Zangezur Copper and Molybdenum Combine.
“We now have the second-largest mining company, which will have a direct impact of around 2% on the economy. Its indirect impact could amount to another 1.5–2%.”
He stressed that the company would become a customer for more than 200 small and medium-sized enterprises, serving as a “driving force for regional businesses”.
The economist also believes that the mine’s operation will bring significant social benefits. Around 1,000 direct jobs are expected to be created, alongside 4,000–6,000 indirect jobs.
“Salaries here are quite high, averaging 900,000 drams ($2,356) or more. This is a fairly high figure, even exceeding the average salary at other mining companies in Armenia,” he explained.
Suren Parsyan pointed out that Vayots Dzor is one of Armenia’s poorest regions, with a poverty rate of around 25%, above the national average.
He also noted that, in addition to creating jobs, the project includes a social component aimed at supporting nearby communities.
“The poverty rate could fall significantly, by around two to three times. In Vayots Dzor, where the population is small and employment opportunities are limited, this could provide a long-term solution to the problem,” he concluded.
