Lydian’s bankruptcy proceedings, however, provoked discussions at the FCDO as to whether the operation was, in fact, a UK company. (Today, the restructured Lydian group has a UK private company as part of its structure.)
A June 2021 FCDO email obtained via freedom of information law stated that following the company’s restructuring, “it can no longer be defined a [sic] UK company”.
“It does have some UK investment but is now an identifiably Canadian operation,” the internal email to Ambassador John Gallagher read.
The briefing noted further caution and a possible “reputation management challenge” for the UK FCDO if Lydian’s operation was sold on to an unnamed Russian-led investment consortium (not the EDB) following bankruptcy, mooting possible “allegations about standards/ethics/social impact of this project under the new ownership”.
The FCDO has insisted its role in the affair is routine, but Armenian campaigners have long drawn attention to what they see as the UK’s over-the-top support for the controversial project. A 2019 letter by prominent members of Armenian civil society called on the FCDO to withdraw its support for the Amulsar mine over its potential environmental impacts.
Those impacts were meant to be mitigated by top-of-the-line environmental measures, as paid for, in part, by the international EBRD and IFC banks. The IFC withdrew from the mine in 2017, as did the EBRD in 2020, after two years of the protesters’ blockade.
An independent compliance report by the IFC later found that Lydian’s capacity to address environmental and social risks had been overestimated, as well as failing to assess the mine’s impacts on the nearby spa town of Jermuk, a tourist centre. The EBRD is conducting its own compliance process over the mine, but has not published an update for over two years. The EBRD compliance team did not respond to a request for comment.
Lydian, now owned by resource companies Orion and Osisko Mining, did not respond to a request for comment. The company has always said it has pursued the highest international standards on mitigating social and environmental impacts of the mine.
The EDB said in its statement that it expects to “implement a project that meets high environmental standards, has a positive impact on the economy and creates employment opportunities”.
“The UK government’s direct involvement in supporting this business interest in the face of the democratic aspirations that we have in our country is an almost too explicit reality check for us: the UK government is all about capital’s interest, it has no interest in people’s autonomy or access to natural resources,” said Shakhnazaryan.
