The “Ararat Gold Extraction Company” (AGEC), a joint-company for extracting the mines in Sodk, was founded in 1998. The Indian “Sterlite Gold Limited” company owned 50% of shareholdings, and the Armenian government with its “ArmenianGold” state-owned company owned the other 50%.
The joint-company had its 22 million dollar regulatory capital-each side equally invested 11 million dollars. Basically, the Indian company owners purchased half of Armenia’s gold mines for 11 million dollars. In 2002, the company purchased the other half for 3.5 million and paid 14.5 million for the Sodk gold mine, which will serve as a mine for 50 tons of gold extraction throughout the next 12 years. Gold prices are going up worldwide. True, prices have been going down for the past couple of days [the price for 1 uncial (31.1 grams) has gone down from 680 dollars to 540], but according to experts, prices will start going back up again soon, especially since there is a limited amount of extracted gold resources all over the world.
On June 14, as expected, the Indians transferred the AGEC to the “Vedanta Resources” company registered in the London Stock Exchange. The company is one of the world’s largest producers of zinc, silver, copper, aluminum and lead. President of “Vedanta Resources” Anil Agarval is also the president of “Sterlite Gold”, which belongs to AGEC. It turns out that “Sterlite Gold Limited” is the sister company of “Vedanta Resources”-something that director of that company Vartan Vartanyan didn’t want to believe.
I must say that there are some interesting things are going on between AGEC and the Ministry of Ecology of Armenia. As we had informed our readers, the company wants to move the gold extraction factory from Ararat to Vardenis [next to Sodk]. The Armenian government rejected the company’s first proposal because it was going to cause major ecological problems, especially for Sevan Lake. Two weeks ago, the owners of the company said that they had made a second proposal to the government and were waiting for a response. This time they had foreseen building a factory 35 kilometers away from the lake (the distance in the first proposal was 6 km). On Tuesday, the Minister of Ecology Vartan Ayvazyan made a startling announcement. According to the minister, the owners of AGEC have caused more damage than actually made any investments. He even accused the factory of hiding the real amount of extracted gold so that they will pay less to the state. Besides that, the minister denied the fact that the company had made a second proposal to the government. Ayvazyan also said that the government is not obligated to find and provide them a spot. The company owners gave responses to all of the abovementioned:
“If our company committed illegal acts, then we would be in court many times,” said Indian owner B. Sharma.
“The company wouldn’t receive 20 million dollars if it hid a ton of gold. So, it shouldn’t receive 20 million in order to not pay taxes?” said the company’s lawyer Armen Ter Tatchatyan.
“We have sent the proposal and have gotten the response,” said Vartan Vartanyan. Besides that, the minister of ecology V. Ayvazyan announced that the company had broken some rules. According to the AGEC lawyer, in 2004-2005, the ministry has brought a case against the AGEC two times, but the company owners appealed to the court two times and won the case. A. Ter-Tatchatyan was trying to hint that gold prices have gone up worldwide and that the minister expects more from the company. The minister told “168 Hours” during a phone conversation that he will find out just what the company owners have said and counterattack.
“Don’t rush into things,” he advised.
It is worth mentioning that last year, when “Indian-Armenian” relations were once again pretty active, there were some rumors going around in the newspapers that the factory owners had given two “Jeeps” to the Minister of Ecology. Perhaps there are higher expectations this year, at least that’s what the opposite side was trying to make everyone understand. Perhaps it’s pre-election year. But let’s wait and see what happens because things are looking up.