ArmInfo.The government of Armenia is negotiating on attracting a new operator to the Teghut copper-molybdenum deposit development project. Acting Deputy Prime Minister Tigran Avinyan said answering the question of the MP Armenuhi Kyureghyan on November 14 in the National Assembly of the Republic of Armenia.
According to him, negotiations are underway with one of the Russian banks related to VTB. The Acting Deputy Prime Minister assured that there is no decision of the government of the country to close the Alaverdi Copper Smelter. Negotiations are underway with the owners of the company and VTB Bank. As Avinyan admitted, sooner or later the company had to suspend its activities due to environmental risks. Today, discussions are underway on the construction project in Alaverdi of a new, larger copper smelter, which will be able to process over 100 thousand tons of ore per year. Tigran Avinyan also noted that from next year, the implementation of a program for the re-cultivation of land near the open fields will begin.
To recall, starting from October 19, 2018, the Alaverdi Copper Smelter, which produced blister copper using technologies back to the middle of the last century, suspended its operation. About 650 employees of the company were sent on unpaid leave. The State Inspectorate for Environmental Protection fined the plant 380 million drams ($ 700 thousand) due to a serious violation of environmental legislation, adopted in 2005. In an interview with Public Radio of Armenia, plant manager Lusine Mejloumian said that the practical impossibility of fulfilling the requirements prescribed by the environmental inspectorate brought the issue of shutting down the plant's work to the agenda.
According to independent observers, the position of the supervisory authority undoubtedly corresponds to 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 supervising authority 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 by one 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.
To note, the Alaverdi copper smelter was built in the 1950s 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.
By a decision of Deputy Prime Minister of Armenia Tigran Avinyan of July 12 of this year, a working group was established to provide state support to the preparatory work in the framework of the construction program of the new copper smelting plant by Armenian Copper Program CJSC (ACP), also part of the VallexGroup. According to preliminary estimates, the investment value of the enterprise will be about $ 80 million. The group included representatives of 4 ministries - economic development and investments, finance, as well as energy infrastructures and natural resources. The work of the enterprise will make it possible to obtain pure copper in Armenia, thanks to which it will be possible at least partially to restore various related production in the country.