Month: March 2007

ARMENIA FEARS RENEWAL OF COLD WAR
Conor Sweeney in Moscow

Irish Times
Feb 28, 2007

RUSSIA: The "biggest fear" for a country such as Armenia would be a
return to Cold War tensions between Russia and the US, the country’s
foreign minister, Vartan Oskanian, has said, just ahead of his visit
to Ireland today.

This is the first to Ireland by a senior figure from the landlocked
country.

"We’re geographically and geopolitically in a very difficult region,"
Mr Oskanian says. "For us, Ireland is an important EU country, and
in the 15 years since Armenia’s independence there has never been a
visit by us, or an Irish visit to Armenia."

Little known in Ireland, Armenia claims to be the first country in the
world to have adopted Christianity. In the last century it suffered
from a genocide at the hand of the Turks, followed by Stalinist purges
under Soviet rule, before finally gaining independence in 1991 and
plunging into a destructive war with neighbouring Azerbaijan.

Apart from their similar population sizes, both Ireland and Armenia
have large diasporas abroad, Mr Oskanian says. Armenia hopes to emulate
Ireland’s economic development and learn from its peace process.

He points to the broad parallels between Northern Ireland and his
own country’s frozen conflict with neighbouring Azerbaijan over
the Nagorno-Karabakh enclave, where the majority of the population
is Armenian.

More than a million people were displaced during the war between the
two countries in the early 1990s.

Despite corruption, Armenia has seen double-digit economic growth
for the past seven years, although, as Mr Oskanian concedes, this has
been slow to trickle down through society. Rural poverty is still a
big problem and average wealth is one-eighth of the Irish level.

Apart from the deep tensions with Azerbaijan, Armenia also has borders
with Turkey, Georgia and Iran. The frontier with Turkey is sealed,
Georgia’s dispute with Russia has made exports to the latter difficult
and tensions between the West and Iran could soon lead to problems
on the southern border, too.

So far, Armenia has, unlike Georgia, managed to retain good relations
with Moscow while opening up towards the EU. A few months ago, the
country joined the union’s near neighbourhood policy, although Mr
Oskanian avoids offering any long-term declaration of interest in
EU membership.

From: Emil Lazarian | Ararat NewsPress

SECOND SEMINAR UNDER TITLE ELECTORAL DISPUTES TO BE HELD ON MARCH 1-2 IN YEREVAN

Noyan Tapan
Feb 28 2007

YEREVAN, FEBRUARY 28, NOYAN TAPAN. Second seminar from the series
Support to Free and Fair Elections under the title Electoral Disputes
will be held on March 1-2 in Yerevan. It is organized within the
framework of Armenia-NATO Individual Partnership Actions Plan (IPAP).

The seminar is held by RA Foreign Ministry, Cassation Court and Greek
Center for European Public Law with the support of Foreign Ministry
of Greece. As Noyan Tapan was informed from RA Foreign Ministry Press
and Information Department, eight international experts of electoral
legislation and electoral disputes will take part in the seminar.

RA PRESIDENT AND CBA PRESIDENT ASSESSED THE MICROECONOMIC INDICES AS PROMISING

armradio.am
28.02.2007 17:11

During today’s meeting RA President Robert Kocharyan and President of
the Central Bank of Armenia Tigran Sargsyan assessed the microeconomic
indices registered at the turn of the year as promising. Reference
was made to the positive trends in the import-export structure,
according to which import of equipments and new technologies
considerably increased.

CBA President informed that in January an unprecedented 12 % rise
was registered in deposit accounts, which means citizens trust their
savings to banks and prefer to make deposits in Armenian drams.

The interlocutors also turned to the rise of salaries, noting that
approximately 20% rise was registered in January.

RPA AND ULP TO SPECIFY ISSUE OF NOMINATING CANDIDATES FOR PARLIAMENTARY ELECTIONS IN COMING TWO DAYS

Noyan Tapan
Feb 28 2007

YEREVAN, FEBRUARY 28, NOYAN TAPAN. The issue of nomination of RPA
candidates for forthcoming parliamentary elections by proportional and
majoritarian systems will be decided at the Party Board’s sitting to
be convened on February 28, at 21:00. Noyan Tapan correspondent was
informed about it by Galust Sahakian, Head of RA National Assembly
RPA faction.

In the words of Grigor Ghonjeyan, member of NA United Labor Party
(ULP) faction, a final decision on issues connected with nomination,
as well as on affirming the Party’s list by proportional system will
be made at the enlarged sitting of Party Board scheduled for March 1.

To recap, nomination of candidates for NA elections by majoritarian
and proportional systems started on February 26 and the deadline is
March 3, 18:00.

ORGANIZATION CHOICE IS YOURS PLANS TO HOLD LARGE-SCALE OBSERVATION MISSION DURING PARLIAMENTARY ELECTIONS

Noyan Tapan
Feb 28 2007

YEREVAN, FEBRUARY 28, NOYAN TAPAN. The Choice is Yours NGO plans to
hold both long-term and short-term observation mission during the
parliamentary elections. Organization Chairman Haroutiun Hambartsumian
reported this at the February 28 press conference.

In his words, this year, in difference to the previous elections,
during which 50-60% electoral districts were under observation,
the organization plans to hold a large-scale observation activity,
which will include all electoral districts. It is supposed that
during elections, 41 out of more than 4000 observers of Choice is
Yours organization will carry out long-term mission in majoritarian
electoral districts.

"We are going to watch the whole period of preelection agitation and
after the elections we plan to announce the preliminary results,"
H. Hambartsumian said. He expressed confidence that the number of
falsifications will considerably decrease thanks to amendments to
the Electoral Code.

In response to Noyan Tapan correspondent’s question, whether the
organization is going to have control mechanism over preparation
of protocols, H. Hambartsumian said that irrespective of electoral
commissions’ providing final protocols, the observers of Choice is
Yours organization will have their own forms of protocols where the
final data will be introduced.

RA NATIONAL ASSEMBLY FEBRUARY 28 SITTINGS FAIL DUE TO NO QUORUM

Noyan Tapan
Feb 28 2007

YEREVAN, FEBRUARY 28, NOYAN TAPAN. RA National Assembly February 28
sittings failed due to no quorum. As a result, holding of NA-government
question and answer scheduled for evening also failed.

At least 66 MPs should have been registered for starting the sitting,
while 23 deputies were registered at 12:00 and the number of registered
deputies increased only by two within three hours determined by
NA Regulations.

The last sittings of NA regular four-day session are scheduled for
March 1.

MURDERS OF HRANT DINK AND GURGEN MARGARYAN WERE THE RESULT OF THE ANTI-ARMENIAN POLICY OF TURKEY AND AZERBAIJAN

armradio.am
28.02.2007 17:55

The assassinations of Hrant Dink and Gurgen Margaryan were the result
of the anti-Armenian policy of Turkey and Azerbaijan, Director of
the Armenian Genocide Museum-Institute Hayk Demoyan said at today’s
press conference.

The later represents the Defense Ministry of Armenia at the court
hearings on the case of murder of Gurgen Margaryan. In his words, the
clan of Aliyevs is engaged in anti-Armenian propaganda, and it’s worth
mentioning that it is done not only by Ilham Aliyev but also his wife
and his daughter Leila, who organized an event in Moscow dedicated
to the Azerbaijani interpretation of Khojalu tragedy. However, as
Hayk Demoyan noted, the Azerbaijani authorities keep silent about
the crimes against their own people.

ARMENIA PICKS HAYKO FOR EUROVISION

Doteurovision, UK
Feb 28 2007

Hayko will have the job of following up Andre’s impressive debut at
the Eurovision Song Contest when he represents Armenia in Helsinki.

On the face of it, Andre’s record should remain untarnished. Hayko
will perform ‘Anytime You Need’ in a language that bears striking
similarities to English.

Hayko enjoys a successful career in Armenia, having been voted best
male singer in 2003 and 2006. He has not previously recorded material
in ‘English’.

The song that will be presented during the final of the 2007 Eurovision
Song Contest is written by Hayko along with Karen Kavaleryan, who
co-wrote the Russian entries in 2002 and 2006 and the lyric to the
Belarussian song this year.

hp?action=fullnews&id=1356

ARMENIAN GENOCIDE RESOLUTION: TURKEY’S CHUTZPAH

Assyrian International News Agency, CA
Feb 28 2007

We are certainly not insensitive to the significance of Turkey’s
support of Israel. But the Turkish government’s attempt to capitalize
on that support by pressing the American Jewish community to oppose a
Congressional resolution that condemns as "genocide" Turkey’s murder
of a million and a half Armenians during World War I strikes us as
being the height of chutzpah.

As The New York Sun reported, on February 5 the Turkish foreign
minister met with representatives of several major Jewish groups
and "made a hard sell" against House Resolution 106, which now has
176 co-sponsors. The Turkish official reportedly appealed to the
participants by noting — outrageously, we think — the uniqueness
of the German genocide against the Jews. The Turks do not deny that
between 1915 and 1917 they conducted a devastating military campaign
against the Armenians and that thousands of Armenians were killed on
forced marches. They claim, however, that the hapless Armenians were
a fifth column, often armed and working on behalf of the Russian army
in World War I.

But the American ambassador to the Ottoman Empire at the time, Henry
Morgenthau, wrote in his memoir, "I am confident that the whole
history of the human race contains no such horrible episode as this."

The orders for the deportations of the Armenian families in 1915
"were merely giving a death warrant to a whole race," he wrote.

Anyone who seriously and objectively considers those events cannot
but conclude that there was a calculated and purposeful effort to
exterminate the Armenians. After all, approximately 1.5 million
perished.

That said, we understand that opposition to House Resolution 106 does
not necessarily signify lack of sympathy with the victims, or, indeed,
sentiment against the concept itself. Not buying into an initiative
on someone else’s schedule is not always an indicator of nefarious
motives at play.

We also have no doubt that some would argue the Jewish community should
oppose the resolution if only to preserve the aura of uniqueness
surrounding the destruction of European Jewry in the Holocaust. And
this, perhaps, was the point the Turkish foreign minister was trying
to make in his presentation to Jewish leaders.

But acknowledging as genocide the systematic murder of a million and a
half human beings of a particular ethnic heritage in no way detracts
from recognition of the Holocaust as a uniquely monumental evil in
the blood-soaked annals of human history.

source

ARMENIA MAY START PROSECUTION OF VEDANTA-CONTROLLED ZOD GOLD MINE
By: John Helmer

Mineweb, South Africa
Feb 28 2007

MOSCOW (Mineweb.com) –A state prosecutors’ investigation has uncovered
serious and fresh licence and regulatory violations by Vedanta’s
gold mine operator in Armenia. The move by Armenia’s prosecutors
follows eighteen months of special commissions and ministry-level
investigations that failed to produce compliance by Vedanta. This
time, if the Armenian government moves into court against Vedanta,
the company could lose the Zod gold mine altogether.

A 5-page report was issued last week by three experts – government
officials from Armenia’s ministry of natural resources. Their
report had been commissioned on January 24, and they were ordered to
assess Vedanta’s performance in line with a list of 16 statutory and
regulatory agreements and undertakings.

The findings followed within a month. They accuse Vedanta’s Armenian
mining company of under-spending on required mine operations and
under-valuing taxable assets.

Zod, located in the eastern corner of Armenia, close to the Azerbaijan
border, has been evaluated over more than a decade by Soviet
geologists, Kilborn-SNC, SRK, Snowden, and Micon. First identified
in 1976, and prospected when Armenia was part of the Soviet Union,
the mine project has also included substantial, high-grade tailings
from Soviet-era mining.

Mining rights for Zod (also known in Armenia as Sotk), and a second
deposit known as Meghradzor, were initially vested in the Ararat Gold
Recovery Company (AGRC) for 25 years each. Following the break-up
of the Soviet Union and Armenia’s independence, Canadian mining
entrepreneur Robert Friedland acquired the rights for a company of his,
called First Dynasty Mines Armenia, in a joint venture with a local
state-owned mining enterprise. The state sold out, and full rights
were sold in 2002 to Indian entrepreneur Anil Agarwal’s company,
Sterlite Gold. Agarwal is reported as holding the titles of chairman
and director of Sterlite, whose principal office is in Mayfair,
London. Sanjay Dalmia is the CEO. Agarwal’s bigger title and property
is Chairman of Vedanta Resources, also officially based in London.

In 2002, Sterlite said it produced 102,960 oz, primarily from tailings
accumulated at the Ararat processing plant. In 2003 output fell
to just over 59,000 oz, as the tailings dwindled, and costs rose
for transporting the ore, mined at the Zod pit, by railway to the
processing plant, 235 kilometres away to the west, on the Turkish
border. The plant has the capacity to process about 1 million tons
of ore per annum, but the cost of transportation is prohibitive.

According to company releases, in 2005, gold produced from tailings
and ore totalled 44,137 oz, a decline of 35% on the year before. The
costs of production outstripped revenues; and financial statements
issued by the company, losses in the nine months to September 30,
2005, had mounted to almost $7 million. In the most recent financial
report for the nine-month period of 2006, the Armenian operations
were still running at a loss. The company blames the loss on falling
grades at the Zod mine, falling tonnages of tailings, and lower grades
in the tailings.

Substantial investment in a new mill at the mine site was promised by
Sterlite, and according to the company, it was targeting a revival of
production to at least 160,000 oz per annum. A website statement claims
"the Company estimates that a minimum capital expenditure of US$ 80
million will be required to execute the move and will take a minimum
of 18-24 months to complete. The Company is committed to undertake
the move once environmental clearance is provided by the Government
of Armenia. For financing this move, the Company is looking to raise
funds using a variety of options."

There is no mention in Sterlite releases of the trouble it was in with
the Armenian government. In a note on contingencies, attached to the
3rd-quarter financial statements issued last year, Sterlite admits
it had been obliged to pay additional royalties on an under-counting
of gold production. Payment was made in December 2005.

A further royalty tax claim for the period 2004-2005 was in court,
Sterlite contended — without referring to the broader dispute over
licence violations.

No fund raising by Sterlite has taken place. Instead, in the second
half of 2006 Agarwal sold his control stake in Sterlite to Vedanta,
making a handsome profit. As Mineweb reported last June, Sterlite’s
controlling shareholder at the time, with a 55% stake, was Twin Star
International (TSI), which is fully owned by Volcan Investments, which
in turn is controlled by Anil Agarwal. Thus, he appeared to be on the
receiving end of the $34 million (C$37.68 million) Vedanta agreed in
June 2006 to pay for its takeover of the TSI stake, plus $27 million
(C$30.8 million) for the other shares in Sterlite.

Vedanta is also controlled by Volcan, with about 54% of Vedanta’s
shares, and thus by Agarwal.

In disclosing the buy-out of Sterlite, Vedanta’s statement of June
13, 2006, did not mention Agarwal. But it acknowledged the deal was
"a related party transaction under the Listing Rules of the UK Listing
Authority and an insider bid under Canadian securities laws."

To prepare a valuation and supervise the deal, "a special committee of
directors" was appointed, "who are independent of Volcan". In addition,
Ernst & Young "provided Vedanta with written confirmation that the
terms of the TSI acquisition and Sterlite Gold Offer are fair and
reasonable as far as the shareholders of Vedanta are concerned."

The buyout represented a price of C$0.258 for each share of Sterlite
Gold. This was a 20% premium on the 3-year high achieved by the share
of C$0.215. It was even more generous in relation to the price of
the share just before Agarwal’s sale, when it was three times lower,
at C$0.080. Today’s price for Sterlite is almost unchanged from
Agarwal’s selling price.

Meanwhile, remote from London investors, a great deal has changed in
the Armenian government’s attitude towards the gold asset.

A source familiar with Zod has told Mineweb:"The main problem is that
the company owner is not investing anything into the deposit. Maybe
because of the political situation, maybe because the deposit is
located on the Azerbaijan border, nobody wants to buy it."

The Armenian Minister of Nature Protection, Vardan Aivazyan, has told
Mineweb, through a spokesman, that there are no stop-work or ministry
orders against Sterlite’s subsidiary, AGRC. "The problem," he said,
"is that to continue profitable development of the Zod deposit,
AGRC is asking to build a new refinery close to the deposit itself,
on the shore of Sevan Lake. This violates ecological restrictions."

The expert report to the state prosecutor’s office last week accuses
ARGC, and thus Vedanta, of three main violations — of mining more
gold than planned, instead of over-burden operations; of disposing
less mine waste than required; and of under-valuing reserves. The
charges amount to short-changing the government and its tax budget,
while the miner has tried maximizing the gold offtake for every metre
of earth and ore removed. An additional $20 million in mine spending
will be required, the report recommends. An additional environmental
impact report is likely.

Agarwal and Vedanta were asked by Mineweb to respond to the charges,
and to indicate what financial set-aside or contingency payment they
would report to shareholders for the Armenian prosecution. They did
not respond.

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