Author: Jane Topchian

In the letter, leading environmental lawyer Artur Grigoryan claimed that UK ambassadors Katherine Leach and Jonathan Aves “continuously exert pressure on the Government of Armenia” in support of Lydian International, citing UK diplomatic staff’s meetings with Armenia’s Ministry of Nature Protection and their public statements.

“It is incomprehensible that the Ambassadors of the UK defend the private interests of a company registered in an offshore zone,” the letter stated.

Responding to Save Teghut, the Foreign Office said that the ambassadors’ actions were “strictly in accordance with appropriate international practice and agreements” and that it was “standard and accepted practice for the British Government and its diplomatic missions to encourage trade and investment opportunities overseas.”

At a groundbreaking ceremony in 2016, the UK ambassador at the time, Judith Farnworth, lauded Lydian International’s dialogue with project stakeholders, including “most crucially, with the local communities”.

This dialogue does not seem to have convinced residents of the villages and town near the mine. In Gndevaz, the village closest to the Amulsar mine, 210 residents made an official complaint to the International Finance Corporation (IFC), a financial sponsor, in 2014. They claimed that the company was “employing any possible tool to deceive” village residents over the mine. A similar complaint was made to the European Bank of Reconstruction and Development, another project sponsor.

An investigation by the IFC’s compliance advisor ombudsman reported “shortcomings in the IFC’s supervision of the assessment of impacts” in Gndevaz, although increased IFC engagement with the project led to an “international standard Environmental and Social Impact Assessment”. In 2017, the IFC stopped its funding of the project.

The town of Jermuk, a nearby tourist centre noted for its hot springs, was not initially included in what Lydian considered the ‘area of influence’ for the mine, and residents were not consulted over environmental and social impact assessments in 2015 and 2016. The IFC ombudsman’s investigation in 2017 found that the “potential impacts on Jermuk’s brand as a tourist center” had not been assessed and mitigated. In late 2018, locals collected 3,000 signatures in support of banning metal mining operations in the area, and to develop a green economy for Jermuk – a position later approved unanimously by the town council.

Locals believe that the mine is already affecting local life, according to a survey of 35 households conducted by the Community Mutual Assistance NGO in October 2018.

As part of this survey of households in Gndevaz, Kechout and Jermuk, 85.7% of respondents reported illness, such as increasing asthmatic attacks, lung diseases and dry skin. As a result of construction operations and explosions, 71.4% of respondents said they had suffered nervous breakdowns, headaches and insomnia. Respondents welcomed the contribution by the company to community infrastructure and household incomes, yet 80% of them were pessimistic about their employment prospects in ten years’ time, when the mine is projected to close.

More broadly, local people, environmental activists and their international allies are protesting against the damage they believe the gold mine will do to the environment, biodiversity and human health in the area. There is particular concern about the mine’s heap leach facility, which uses cyanide to separate gold from ore, as the mine is close to a reservoir that connects to Armenia’s main source of fresh water, Lake Sevan.

“There is a strongly held and widely shared belief that despite any short-term economic benefits, this mine will have long-term negative consequences for the environment and for people’s health and wellbeing,” says Armine Ishkanian, associate professor in social policy at the London School of Economics.

“There is a great deal of public skepticism in Lydian’s claims, recently repeated by Armenian government officials, that the mine poses minimal risks,” Ishkanian says.

Lydian states that Amulsar “will show the benefit of transparent and effective investment to world class standards” in Armenia and “bring tangible, direct and lasting economic benefits to the country”.

To protect its reputation, Lydian has brought defamation suits against activists in Armenia campaigning against the project. The International Federation on Human Rights has criticised the company’s “worrying systematic judicial harassment and defamation campaigns aiming to silence critical journalists and human rights defenders, particularly women”.

Earlier this year, 41 international environmental NGOs co-signed a letter to Armenian prime minister Nikol Pashinyan, which reported that Armenian human rights defenders believe Lydian’s “PR strategy is to humiliate and discredit [them] through real and fake users in social media, online media and television”.

In response to one of these claims of social media harassment, Lydian stated that this was “another example of clear disinformation”.

The UK Foreign Office’s support for Amulsar has drawn criticism from Armenian civil society.

In June 2018, Armenian human rights and civic activists boycotted the annual Queen’s birthday event at the UK embassy in Yerevan because it was co-sponsored by Lydian International.

Womens’ rights activist Lara Aharonian wrote that she was unable to attend because Lydian International was “exploiting our country’s resources to enrich local corrupt officials and multinationals”. Those concerns did not deter dignitaries, including Armenian president Armen Sarkissian, from attending. Sarkissian acted as a board member of Lydian International in 2013.

“It is standard practice for British embassies to invite commercial organisations with a UK connection to sponsor the Queen’s Birthday Party each year in order to deliver a high-quality celebration whilst limiting public expenditure,” a Foreign Office spokesperson said.

The Amulsar project has now been at a standstill for over a year due to local blockades. In July 2018, Lydian filed a complaint in support of a criminal investigation against activists at the blockades, which was later upheld in court.

That same month, a criminal investigation was opened into whether Armenian public officials had withheld information regarding potential environmental damage at Amulsar. The Armenian authorities allocated nearly $400,000 for an independent review of the project’s environmental and social impact assessment (ESIA) as part of this investigation. Although Lydian has complied with the review, the company “does not accept the need or legal basis” for it, since the Armenian government has already confirmed its compliance with environmental legislation.

This independent review was published earlier this month, and on this basis Prime Minister Pashinyan appeared to decide to permit the mine to go ahead despite protests in Jermuk and Yerevan. “The Audit Report substantiated Lydian’s prudential approach to environmental stewardship,” said Lydian CEO Edward Sellers in response.

The International Federation on Human Rights responded to the new report by pointing to the serious criticisms of Lydian’s ESIA process, such as land acquisition and public consultations, contained within. The organisation emphasised that the report contained “a number of worrying conclusions on the environmental assessment and monitoring plans”, as well as highlighting the report’s conclusion: “The ESIA/EIA [environmental and social impact assessment] assessments are deficient and corresponding conclusions are unreliable. Accordingly, the question of whether exploitation of the ore deposit can conclusively be considered safe cannot be answered.”

Days later, however, Pashinyan requested that Armenia’s Ministry of Environment decide whether a further environmental impact assessment (EIA) was required for the Amulsar project. Lydian called the news “disappointing”, stating that the company “had been subject to three environmental audits over the past year during which there was no suggestion that any additional EIA process would be required”.