Friday, May 8 2015 07:09

 Today, on May 7, the Government of Armenia approved a USD 240 mln investment program on re-treatment of the tailings of the Zangezur Copper Molybdenum Combine (ZCMC).    

To note, the relevant memorandum of intention was signed in mid 2014 among the ZCMC, Cronimet Mining (the key shareholder of ZCMC), VS Energy International Group, Alyotig LLC, and the Armenian Government, which approved the document on 16 October 2014. 

According to the program, the investors are going to build a re-treatment plant with a capacity of 12.5 mln tons per annum. Alyotig LLC will be the general contractor of the project (the founder and the only project participant is Vardan Shahnazaryan, and the director general is Manvel Voskanyan). The company has technological developments, which will enable the efficient re-treatment of the waste rocks. The investor of the program is VS Energy International Group (with its shareholder being Ukrainian businessman Eugeny Ginner).

The matter concerns the launch of tailings re-treatment near the Vokhchi, Pkhrut and Artsvanik rural communities. The tailings have been accumulated here since the 1940s. Now their volume is 300 mln tons and it increases by 18-20 mln tons per annum. Under the project, the ZCMC transfers the ownership of the process waste in the decommissioned tailing dumps to Alyotig LLC. 

The investors are also planning to build a plant for production of composites for processing nonmetallic trash. The plant will have a capacity of 10 thsd tons. It is envisaged to launch production of import- substituting products, hail suppression devices, as well as to manufacture raw materials for construction, machine tool industry, etc. 
Earlier Deputy Minister of Energy and Natural Resources Levon Shahverdyan reported that the project would allow launching advanced waste processing (95%- 98%). "This project will be of great importance for Armenia and will allow creating 1,500-1,800 new jobs," Shahverdyan said.

Previously, Vazgen Safaryan, Head of the Union of Local Producers of Armenia, told reporters that 1.5 billion tons of tails have been accumulated at tailing dumps in Armenia. In case of processing 80 million tons of tails per year, 10,000 tons of pure refined copper, 3-4 million tons of iron, 250,000 tons of free sulphur, 170 tons of tellurium, 3.6 tons of gold, 142 tons of silver, as well as rhenium and other alloy materials could be recovered.  There are 17-19 metal-containing ore tailing dumps in Armenia and the tailings disposal facility could operate for 30-40 years.

To note, "Zangezur Copper Molybdenum Combine" CJSC is the largest mining enterprise in Armenia and exploits the Kajaran deposit, which is the richest in the CIS by its copper content. ZCMC was privatized for 132 mln USD on 14 December 2004. Afterwards, 60% of its shares passed into the ownership of Cronimet Mining (Germany), with the remaining 15%, 12.5% and 12.5% having gone to the Pure Iron Plant (Yerevan), "Armenian Molybdenum Production" CJSC and "Zangezur Mining" LLC, respectively. According to Cronimet Holding (headquarters in Karlsruhe, Germany), over the past few years the total investments in Zangezur Copper Molybdenum Combine CJSC amounted to over $500 mln. Cronimet Mining also owns 51% of "Pure Iron Plant" OJSC's shares and 51% of ELBAT CJSC, an automotive battery production plant.
To note, in June 2014 Neil Stevenson became the new Chief Executive Officer of the ZCMC. The relevant decision was taken at the June 24 annual meeting of Zangezur Copper Molybdenum Combine in Yerevan.  The shareholders decided to a set up a Board of Directors, which is now headed by Maxim Hakobyan, the former CEO. 
In 2015, the ZCMC is planning to process 20 mln tons and in 2016 - 22 mln tons. The Combine employs 3,400 people, and the average salary is 320 thsd AMD. In 2014 the Combine held the 4th position on the list of the largest taxpayers of Armenia, having paid 19.9 bln AMD to the state budget. 

According to the annual Ranking of Major Enterprises in Armenia, prepared by the Agency of Rating Marketing Information (ArmInfo), the ZCMC's net profit in 2013 was 7.5 bln AMD (down 56% versus 2012).