Name of the Project
Amulsar gold project.

Location
Southern Armenia.

Project Owner/s
Lydian Armenia, a subsidiary of Lydian International, which is a wholly owned subsidiary of Geoteam CJSC.

Project Description
Studies on the Amulsar project have demonstrated a compelling opportunity for the development of a large-scale, low-cost operation using openpit mining and conventional heap-leach processing.

The project comprises Site 27 – the preferred location for the barren rock storage facility, and Site 28 – the preferred location for the heap-leach facility.

The deposit will be developed through openpit mining using a 10 m bench height, 22 m2 front shovels and 180 t haul trucks with a capacity to carry 190 t of material.

A production rate of 30 000 t/d over 350 days a year has been the basis for planning. The estimated mine life is less than ten years; however, the model contains a significant portion of inferred material, and drilling has identified additional mineralisation that has not been quantified by detailed drilling below the pits. Over the first five years of production, lower-grade material above the cutoff grade (greater than or equal to 0.24 g/t gold and below 0.30 g/t gold) will be stockpiled.

The processing facility will comprise two‐stage crushing, screening and overland conveying to the fine-ore stockpile and truck loadout bin. From there, the 19 mm crushed ore will be transported by trucks to the leach pad for heap leaching.

Pregnant leach solution from the heap will be treated in a carbon‐in‐column circuit. Gold will be recovered by an adsorption‐desorption‐recovery circuit where the final product will be doré.

Potential Job Creation
Employment is expected to reach 1 300 workers later this year.

Net Present Value/Internal Rate of Return
The project has a net present value at, a 5% discount rate, of $386.2-million and an internal rate of return of 24.5% at a gold price of $1 150/oz,  with a payback of 2.6 years.

Capital Expenditure
Total preproduction capital costs have been estimated at $369.88-million.

Planned Start /End Date
First production from the mine is expected by mid-2018.

Latest Developments
The Armenian government has started its third assessment of the Amulsar gold project’s environmental impact on water resources, geology, biodiversity and water quality. Lydian International has questioned the need for another review of the gold mining project.

The audit follows two previous government-ordered audits in less than a year.

In September last year, the Armenian government ordered a study to assess the potential impacts of the Amulsar project on water resources. The scope of work will now also include a review of the environmental- and social-impact assessment and environmental-impact assessment (EIA), which were approved before Lydian began building the mine.

Lydian has stated that the third assessment will take up to 16 weeks to complete.

Lydian president and CEO João Carrêlo has said that the company will cooperate with the consulting firm appointed to perform the assessment, but has questioned the legal basis for a third audit. Carrêlo contends that the Armenian government confirmed that the Amulsar project complied with environmental requirements when it approved the EIA.

Illegal blockades have prevented access to Amulsar since June last year.

Carrêlo has urged the Armenian government to enforce the rule of law to provide access to the Amulsar project site and allow Lydian to resume construction and environmental activities concurrently with the third audit.

Earlier this month, Lydian formally notified Armenia’s government of disputes related to the ongoing blockades of road access to the Amulsar project. Under the UK legislation, Lydian UK may submit the dispute to international arbitration three months after such formal notification, and under Canadian legislation, Lydian Canada can do so after six months.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Lydian International, tel +44 1534 747 890 or email moreinfo@lydianinternational.co.uk.