Lydian Armenia has formalised a Community Development Agreement with the Armenian government, represented by the Ministry of Economy, and the surrounding communities of Jermuk, Vayk, and Sisian, in relation to the Amulsar mine. Signed on August 31, the agreement stipulates that Lydian Armenia will allocate $7 million annually for community development during both the construction and production phases of the mine. Should the average gold price exceed $3,550 per ounce during production, this annual contribution will rise to $9 million.
The funding will be distributed through a two-pillar model, with 70% allocated to the communities based on a formula that considers factors such as population, land area used by the Amulsar project, and proximity to mine infrastructure. Each affected settlement, including Jermuk, Kechut, Gndevaz, Saravan, and Gorayk, is guaranteed to receive at least 20% of the total funds designated for its respective community.
The remaining 30% of the annual contribution will be awarded on a competitive basis to support community development projects. This mechanism is designed to promote initiatives that yield significant, measurable long-term benefits for a broader range of residents. Importantly, the funds will not be directly transferred to community budgets; instead, they will be managed by the Amulsar Community Development Foundation, which Lydian Armenia has established.
Communities will propose eligible development projects to the foundation, which will then provide funding upon approval. The foundation’s board, comprising four representatives from Lydian Armenia and one from each of the Jermuk, Vayk, and Sisian communities, will have final authority over project approvals.
The agreement also outlines procedures for oversight, reporting, and auditing of the funds, aiming to ensure transparent and effective management. Lydian Armenia has stated that this agreement creates a predictable and institutionalised framework for the company’s long-term support of the communities surrounding the Amulsar mine, ensuring that the economic benefits of the project translate into tangible development opportunities for local residents.
