Editor’s Note: We recently published an opinion piece under the headline “Armenia Should Not Give In to Threats by Lydian Armenia”. After the Commentary appeared on our website we received a letter from a representative of the company disputing the information in our article.

We asked Lydian Armenia to send us their own response so that the readers can make their own conclusion.

Here is their response.

Amulsar: A Possibility for the Modernization of the Armenian Mining Sector

By Armen Stepanyan
VP Sustainability, Lydian Armenia

For years the Armenian mining sector has been criticized for poor environmental management and lack of transparency. As an environmental scientist I believe that the environmental management in the Armenian mining sector would benefit from significant reforms. Mining is the backbone of the economies of countries such as Canada, Australia, Sweden. Mining as an industry has changed rapidly in the last decades, offering new solutions to responsible environmental and social management. Today, mining that offers “Zero Harm” and even “Beyond Zero Harm” concepts is a reality in many developed mining jurisdictions. Armenia still has to catch up. Mining, if performed responsibly, can benefit economies and the communities. We believe that the Amulsar project is a solution and not another problem for the Armenian mining industry.

The Amulsar Gold mine is the flagship project of Lydian Armenia, a 100% owned subsidiary of Lydian International Limited. The Project is also one of the largest investment projects in Armenia since independence, with over $400 million invested to date. Lydian International is a publicly quoted company listed on the Toronto Stock Exchange. This means that information with respect to the company is transparent and publicly available for all stakeholders. Among the major shareholders are a number of reputable institutional investors, including the European Bank for Reconstruction and Development, who require their investees to follow stringent environmental and social standards. Amulsar is the only mining project in Armenia designed and managed under EBRD and IFC Environmental and Social Standards and Requirements.

It is worth mentioning that Amulsar project’s Environmental Impact Assessment is unprecedented in Armenia, both in volume and in content. Lydian has invested more than $6 million on environmental studies since 2008, including engaging reputable international and Armenian organizations such as Wardell Armstrong International, Golder Associates and Global Resource Engineering. The project is designed and constructed to prevent, mitigate or compensate for all possible impacts. It is obvious even to many of the project’s opponents that Amulsar has set a high standard in the industry.

But despite a new approach in the Environmental management, there is still some distrust. We understand the roots of this distrust, stemming from society’s experience with the negative impacts of irresponsible mining in other projects. But things will hardly improve in the environmental management by the mining industry in Armenia if the criticism is based on myths and manipulations instead of facts. One of these manipulations and myths is the claim of the possible impact of the Amulsar mine on the Lake Sevan and Jermuk waters because of possible acid rock drainage risk (ARD).

Firstly, there is no hydraulic connection between the groundwater regimes at the Amulsar Project and Jermuk waters are a separate geological block from the Amulsar groundwater system. This fact has been proven by isotope analyses performed twice in 2013 and verified again in 2018 by Golder Associates (a leading international consultancy firm) and tests performed in two different independent European laboratories. Thus, the Jermuk waters cannot be impacted by the Amulsar mine even in theory. However, that is not the only guarantee of lack of any impact on the water. Any water system at the Amulsar mine will be protected by modern protection measures, such as linings, diversion channels, water treatment system. The same goes for lake Sevan, 50 km away from Amulsar, which has also been shown to not be affected by the Amulsar mine even in theory. The Amulsar project’s Environmental Impact Assessment is available online and one can see all the models and calculations that show that no discharge, even in theory, would be able to affect the waters of lake Sevan and/or Jermuk.

It is worth noting that ARD occurs naturally and is a common issue in many gold, silver or copper mining projects all over the world including Armenia. To the best of our knowledge in the mining sector in Armenia, Amulsar is the first mining project in Armenia that has incorporated ARD mitigation measures to this standard and has reflected in the Environmental Impact Assessment. This is notwithstanding the fact that the potential for ARD in Amulsar is quite low, compared to many other mines, including some in Armenia. It is Lydian that had first revealed the issue of acid rock drainage in mining for the Armenian society, by disclosing the risk assessment and mitigation measures in its public documents in 2014. Public evidence of Armenian activists speaking about ARD before Lydian publicly discussed this matter is limited. Armenian environmentalists could benefit from Lydian’s disclosure of the risk and the risk prevention and control method suggested by Lydian that has been used in modern mines worldwide. Ironically, however, some of the critics have used this information to manipulate the truth and use it against Lydian. This approach will hardly tackle the environmental issues. It would leave Armenia with unsolved environmental problems associated with mining and may prevent the introduction of modern mitigation measures at the Amulsar mine, by preventing Lydian from operating.

Mining has existed in Armenia for hundreds of years. Mining projects operate today, and will operate tomorrow. The existence of an investment project that brings new environmental standards can shift the environmental management bar to higher standards. Yet, it is Lydian that has been illegally deprived of its rights to operate for over 10 months. Yet it is Amulsar roads that are illegally blocked. This situation not only hurts the Armenian economy and its investment climate, not only does it negatively impact the lives of thousands of direct and indirect beneficiaries of the Amulsar project, but it has also resulted in over 400 people being forced to migrate out from the surrounding communities.

We also believe that those who put time, effort and resources into preventing Lydian from operating the Amulsar project, knowingly or inadvertently, are preventing Armenia from having a mining project that will set new environmental standards for its mining industry.

We in Lydian, together with several environmental scientists in Armenia, believe that the Amulsar Project will have an important role in the economic development of Armenia and will set new standards in the area of environmental and social management. Thus, as an environmental scientist and as a citizen of Armenia I hope that common sense will prevail and the rule of law will be enacted. This will be the only beneficial solution for Armenia.

In connection with the ongoing illegal blockades of road access to the Amulsar Project and resolutions issued by government agencies relating to water and environmental audits, Lydian has formally notified the Government of the Republic of Armenia of the existence of disputes with the Government of Armenia on March 11, 2019. Whether or not Lydian will initiate arbitration proceedings will depend on the conduct of the Government of Armenia. Lydian fully reserves all rights and remedies to address any disputes under Armenian and international law.

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