Thursday, February 2 2017 17:40
Alexandr Avanesov

Lydian Armenia invites NGOs to participate in discussions on Amulsar project development

Lydian Armenia invites NGOs to participate in discussions on Amulsar  project development

ArmInfo. Extinct plant  species relocated from Amulsar mining field have taken roots in new  environment, member of Public Council, CEO of Lydian Armenia Hayk  Aloyan stated at the session of Public Council under Ministry of  Nature Protection of Armenia held on February 2, the press service of  the Ministry informs. 

During the meeting Hayk Aloyan offered non-governmental organizations  to hold expert specialized discussions involving environmentalists  and specialists prior to public discussions of Amulsar project. 

The Chairman of the Council, Minister of Nature Protection of Armenia  Artsvik Minasyan noted that the Amulsar project documentation and  studies are very extensive consisting of nearly 8 thousand pages and  stressed that it is necessary to present them to society, while  profound study of those documents will help the specialists to make  statements based on arguments. 

To note, the company has taken a decision to rename the fully owned  Armenian subsidiary of Lydian International previously called Geoteam  to Lydian Armenia. As it was previously reported, Lydian  International Limited (TSX:LYD) ("Lydian" or "the Company") has  announced that the Board of Directors of the Company approved the  terms of a proposed non-brokered private placement (the "Private  Placement") of ordinary shares of the Company to the European Bank  for Reconstruction and Development (the "EBRD") on July 21. Under the  terms of the proposed Private Placement, the EBRD will subscribe for  an aggregate of 33,500,000 ordinary shares of the Company at a price  of C$0.34 per share, for aggregate gross proceeds of C$11,390,000.  The funds will be used to finance the Environmental and Social  Mitigation Measures (ESMM) undertaken as part of the Amulsar Gold  Project in Armenia. Currently, the EBRD holds 12,038,780 ordinary  shares of the Company, representing approximately 1.8% of the  currently issued and outstanding ordinary shares of the Company. Upon  completion of the proposed Private Placement, the EBRD will hold  45,538,780 ordinary shares of the Company, representing approximately  6.5% of the then issued and outstanding ordinary shares of the  Company.  "We are pleased to have the ERBD's continuing support as we  begin development of the Amulsar Gold Project. This investment  provides further recognition of Lydian's commitment to good  international industry practices and standards as we make the  transition from developer to producer," said Howard Stevenson,  President and CEO of Lydian International. Completion of the proposed  Private Placement is subject to, among other things, negotiation and  execution of definitive agreements, approval of the Toronto Stock  Exchange and any other required regulatory approvals, as well as  other customary terms and conditions. There can be no assurances that  the Private Placement will be completed on the terms approved by the  Board of Directors of the Company, or at all.  The Company proposes  to use the net proceeds of the Private Placement for the financing of  environmental and social mitigation measures and related activities  in connection with development of the Company's 100%-owned Amulsar  Gold Project. 

Earlier, at the request of ArmInfo, Geoteam Managing Director Hayk  Aloyan commented on the prospects and opportunities for the Amulsar  Project with the additional equity participation perspectives of EBRD  earmarked to support ESMM. "Geoteam and Lydian are committed to best  international practice in Environmental and Social Management of our  Amulsar project. The recent disclosure of the amended Environmental  and Social Impact Assessment and a through consultation process with  a multitude of stakeholders is yet another step towards ensuring that  Amulsar becomes a world-class well managed mining operation. It is  both our institutional shareholders', including IFC and EBRD, and our  company management commitment to see this mine advance in line with  industry best practice. Today mining industry worldwide has come up  with modern and applicable technological measures to ensure safe and  sound operations and my firm belief is that Armenia too can have a  modern and safe mining industry. Amulsar will be an important step  towards that goal. It is also important to mention that while the  industry worldwide is experiencing economic down-cycle, Lydian has  secured most of the investment needed to build the project that will  benefit the shareholders and bring economic opportunities to  Armenia," Hayk Aloyan said.

The EBRD has been an important strategic investor for Lydian since  2009. Including its initial investment, the EBRD has supported Lydian  through four previous private placements. Representatives of the EBRD  work continually with Lydian to develop and implement good  international industry practices, including compliance with the  framework embodied in the EBRD Performance Requirements. The EBRD's  Armenian and regional presence is also an important resource that  consistently provides support for Lydian's exploration and  development programs.  UK domiciled Lydian International Limited is  the sole owner of Geoteam CJSC that was granted the Mining Right for  its 100% owned Amulsar Gold Project. On May 17, the company published  its updated ESIA for the Amulsar Gold Project. Geoteam CJSC was  granted a Prospecting License in 2006. Since 2006, the investments in  exploration and other activities in Amulsar have amounted to nearly  US$80 million. Among key shareholders of Lydian are international  institutional investors including IFC and EBRD.  The company plans  about $370 million capital investments in the Amulsar Project.   According to the feasibility study, the proven reserves are 2.5  million ounces, the total recoverable gold is 2.1 million ounces over  a 10.4 year mine life, gold production is averaging over 200,000  ounces per year  (10 million tons of ore), low all-in sustaining  costs of $585 per ounce of gold, 87% gold recoveries. Amulsar is the  second largest deposit in Armenia in terms of the reserves.  The peak  workforce during the Project's construction phase (construction  activities will last for about 2 years) could be as high as 1,300,  while the total workforce during operations within the next more than  10 years is estimated at 650-700 employees.

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