18 Jan 2024 14:44

Lydian hands 12.5% stake in Amulsar gold project to Armenian govt

YEREVAN. Jan 18 (Interfax) - Armenia's government has taken ownership of a 12.5% stake in Lydian Armenia, which operates the Amulsar gold mine, at zero cost.

"A decision has been made to accept the donation of a 12.5% stake in Lydian Armenia. We hope that the Amulsar mine will serve as a platform for introducing new standards in the mining sector," Armenian Prime Minister Nikol Pashinyan said.

The Amulsar gold deposit is located in the southeast of the country, 13 km from the resort town of Jermuk on Mount Amulsar. Development of the Amulsar field has been suspended since 2018 due to protests by environmental activists.

The Armenian government, Lydian Armenia and the Eurasian Development Bank signed a memorandum of understanding in February 2023 to resume the use of the Amulsar gold deposit, the second largest in the country after the Sotk deposit. "By signing the memorandum, the parties declare their intention to raise $150 million; another $100 million will be raised outside this document," Armenian Economy Minister Vahan Kerobyan said at the time. The EDB will allocate $100 million in loans, and another $50 million will be provided by a local bank, he said. Armenian government will receive a 12.5% stake in Lydian Armenia and will ensure the management of possible risks, Kerobyan said.

Lydian Armenia is a wholly owned subsidiary of Lydian Canada Ventures, which in turn is owned by U.S. investment company Orion Mine Finance and Canada's Osisko Gold Royalties. The latter's website said that Amulsar's reserves are estimated at 2.6 million ounces of gold and 12.7 million ounces of silver. The overall resource base is 4.8 million ounces of gold and 25.1 million ounces of silver.

Lydian is the sole shareholder of the Armenian Geoteam Corp., which received an exploration and appraisal license for Amulsar in 2006.