Friday, October 19 2018 14:40

ArmInfo.The furnaces of the Alaverdi copper blister smelter are extinguished. "This is the last copper smelting produced in the plant: I report with great sorrow  that the heart of the copper smelter, the metallurgical plant, has  stopped since that moment," Garegin Antashyan, an employee of the  enterprise, wrote on his Facebook page the night before.

From today about 650 employees of the enterprise have been left  without work and means of subsistence.  In protest, they blocked the  interstate M6 road leading to the Armenian-Georgian border and  railway tracks.  According to them, at the moment they do not know  for what reason they closed the plant - due to environmental or  financial problems. As soon as ArmInfo became known, the plant's  workers are heading for Yerevan, where at 18:00 they are expected to  meet with Deputy Prime Minister Tigran Avinyan.

Employees of the company previously sent an open letter to the Prime  Minister of Armenia with a request to assist in resolving the issue,  noting "otherwise they will be forced to take sharp and unpredictable  actions that can be viewed as steps against the government."

On this issue today to the Acting Deputy Prime Minister Eduard  Sharmazanov, who hails from Alaverdi, also addressed the head of  government, Nikol Pashinyan. In his address, he stressed the  inadmissibility of closing the plant, which for 250 years was the  axial enterprise of the region. He called for. Premier to do  everything possible and impossible to ensure the normal operation of  the plant. Otherwise, as he pointed out, this will result in a new  wave of emigration from the region.

A week earlier, ArmInfo reported that the workforce of the Alaverdi  Copper Smelter launched protest actions calling on the government to  provide an opportunity for the company to significantly increase  sulfur dioxide emissions. As they stated, otherwise, the fines  imposed on the enterprise by environmental supervisory authorities  make the enterprise unprofitable. It was reported that the State  Inspectorate for Environmental Protection fined the plant for 380  million drams ($ 700 thousand) because of a serious violation of  environmental legislation, adopted in 2005. In an interview with the  Public Radio of Armenia, plant manager Lusine Mejloumian said that  the practical impossibility of fulfilling the requirements of the  environmental inspectorate demands that the issue of shutting down  the plant's work be put on the agenda.

According to independent observers, the position of the supervisory  authority undoubtedly fits in the fabric of the behavioral line of  the new government, which aims to regulate the behavior of players in  the country's mining industry, who, until the April velvet  revolution, usually regulated some of their painful issues with the  state on the basis of informal agreements , allowing to bypass these  or other standards in order to improve production efficiency.  Apparently, something similar happened at the Alaverdi Combine and,  according to a new approach, the company fined the enterprise, gave  it a 2-month period to comply with the emission standard, for which  the company simply was not ready.

The problem is complicated by the fact that the property complex of  the enterprise is secured by a loan of $ 500 million, previously  received from VTB Bank for the development of a large Teghut copper-  molybdenum deposit, the operation of which was also stopped due to  environmental problems even last year after the suspension of  co-financing from overseas lenders. Under these conditions, servicing  a VTB loan becomes extremely unaffordable for an enterprise and a  serious decline in the level of profitability of the Alaverdi plant,  in fact, may lead to its bankruptcy.

On October 15, Deputy Prime Minister Tigran Avinyan met with the  group of companies Valery Mejlumyan, and according to  media reports, Mejlumyan intended to cancel the fine of 380 million  drams, appointed by the Ecology and Mineral Resources Inspectorate.  As Tigran Avinyan's head of staff, Varag Siserian, later stated: "we  listened to the problems and said that we are going to discuss this  issue and understand what solutions we can find together. That is,  there are no concrete promises either from our side or from Mr.  Mejlumyan".

Alaverdi copper smelter was built in the 50s of the last century. Its  modernization under the modern enterprise is extremely difficult and  inefficient. One of the solutions to the problem of processing copper  raw materials inside the country is the construction of a new plant  of average capacity, the interest to which is shown by Chinese  investors.

Vallex Group (Vallex Group) was established in 1998 and unites 20  subsidiaries and affiliates. Among them, Teghut CJSC, founded in May  2006, 100% of the shares of CJSC belong to Teghut Investments Limited  of Cyprus, 100% of which voting shares in turn belong to Armenian  Kopr Program CJSC, which is fully owned by Valery Mejlumyan, and also  CJSC "Base Metals", operating the copper-gold deposit in the village  of Drmbon, Martakert region, NKR, Armenian Copper Program CJSC (ACP),  operating the Alaverdi Copper Smelter.