ArmInfo. Lydian Armenia and Ameriabank have signed $24 mln collateral loan agreement. The press-service of the company has told ArmInfo that the loan will be used for purchase of equipment needed for the implementation of the program on Amulsar gold deposit development. The bank will provide the loan in several tranches. The client will receive the first $10 mln in December 2016. Endeavour Financial Company acts as financial consultant of Lydian Armenia.
According to the source construction has launched in Amulsar this year, while the start of activities for gold recovery is scheduled for Q1, 2018. We are glad to finance the current stage of Amulsar project jointly with Ameriabank. Lydian Armenia is currently conducting $50 mln financing, as a result of which the program total financing will reach $420 mln. Ameriabank is the largest bank in Armenia and it will become one of our most significant partners in the country, CEO of Lydian International Howard Stevenson stated.
"Ameriabank is glad to assist the program in mining sector, which will become driving force not only for the mining sector but for the country's economy at large. We are aimed at long-term and efficient cooperation with Lydian team", Ameriabank's Corporate Banking Director Gagik Sahakyan stated.
To note, as of today the program on Amulsar gold deposit development is the biggest foreign investment. The capital expenses on construction work in 2016-2017 will total $370 mln. The process of gold recovery will start in two years. According to the feasibility study of the project total gold reserves of the deposit are 2.5 million ounces, recoverable gold-2.1 million ounces, mine life is 10.4 years, gold production averaging over 200,000 ounces per year (10 mln tons of ore). In average cost for production of 1 ounce will total $585, gold recovery rate-87%. Amulsar is the second largest gold deposit in Armenia.
In August this year official ceremony of the project launch was held. The preparation work has been held since 2006. The term of operation is 10 years and 4 months, it is planned to get 200 thousand ounces of gold annually. The Amulsar project envisages creation of 1,300 jobs in the course of construction and 650- 700 jobs throughout the entire operation of the mine.
To note, Lydian Armenia is subsidiary of British Lydian International, the shareholders of which are institutional investors from the USA, Great Britain, a number of European countries, including IFC and EBRD.
According to the Ranking of Armenian Banks by the Agency of Rating Marketing Information (ArmInfo), as of 1 October 2016 Ameriabank took the lead in lending 352.3 bln AMD ($742.5 mln), with a 21.4% year-over-year growth. 87% of this amount or 306.8 bln drams ($646.6 mln) were directed into the country's economy. The bank increased the amount of economy lending by 22.4% year-over-year. By 1 October 2016, Ameriabank's net profit totaled 3.5 bln AMD ($7.4 mln)and gained leadership on the market.