A JERSEY-registered mining company is embroiled in a $2 billion dispute with protesters and campaigners in Armenia who claim its operations are threatening their environment and livelihood.
Concerns were first raised about Lydian International’s Amulsar project in the former Soviet republic in 2013, with environmentalists claiming that it could contaminate nearby Lake Sevan, damaging the region’s ecosystem and threatening the entire water supply.
A documentary produced by London-based non-governmental organisation Global Justice Now claims that pollution has already affected water supplies, affecting the local economy including its spa facilities, fish farms and agriculture.
Local protesters have been blocking access to the gold mine for the last year, bringing work to a standstill.
A statement on the website of Lydian, a multinational mining company whose registered office is at Bourne House, Francis Street, St Helier, says: ‘Illegal blockades have prevented access to Amulsar since late June 2018.
‘Amulsar will be a large-scale, low-cost operation with production targeted to average approximately 225,000 ounces annually over an initial ten-year mine life. Open pit mining and conventional heap leach processing contribute to excellent scale and economic potential.
‘Lydian is committed to good international industry practices in all aspects of its operations including production, sustainability and corporate social responsibility.’
Nick Dearden, a director of Global Justice Now, said he believed that that Lydian was threatening to use special ‘investor-state dispute settlement’ clauses in British trade agreements with Armenia to sue its government for $2 billion over the matter.
‘The Lydian case is a great example of how companies use corporate courts or ISDS to bully governments and force them to put profits ahead of their democratic obligations to their people,’ he said.
‘Local communities are clear they don’t want this mine, yet Lydian is threatening to sue the Armenian government for a fortune – far more than they ever invested – for responding to those demands of their citizens and halting this project.
‘The grounds used by Lydian are that the Armenian government has “failed” to remove the protesters.’
He added: ‘We know that Lydian, which has its main office in Colorado, has set up a letterbox in London, and we fear that they are essentially “treaty shopping”, using different jurisdictions to give access to international treaties so they can use this awful ISDS system.
We don’t know the nature of their operations in Jersey, but if they are using the Island, with little or no real presence, simply to sue another country, that’s an outrage.
‘We urge the governments of Jersey and Britain to speak out and say their investment agreements should not be used in this way.’
Last year Jersey was granted greater independence to sign international trade deals by the UK. Mr Dearden said at the time that he was concerned that the move could allow large firms to sue governments of developing or third-world countries using Jersey companies, if ISDS clauses were included in the trade deals.