Will operating iron mine turn away tourists?

This past February 23, RA Prime Minister Tigran Sargsyan hosted a delegation from the Chinese Fortune Oil company. During the meeting, the sides discussed the company’s investment program in Armenia’s mining sector.

We should point out that in January, Fortune Oil obtained the rights to three mines in the country.One is located in the village of Svarants, Syunik Marz.

The mine is only four kilometers from the village of Tatev, where the famous medieval Armenian monastery is located.

Press reports say that the iron mine will begin operations in 2014. Right now, the company is conducting preliminary exploratory studies.

There’s an estimated 1.5 billion tons of iron ore at the expansive mine site. Many are concerned that mining operations over such a wide area will have tragic consequences for the local environment.

Readers will no doubt have heard of the recent aerial tramway that was built in Tatev. It is the showpiece of the Tatev Rebirth project designed to spur regional tourism around the monastery complex. Many of the local villages, Svarants included, are part of the project.

One doesn’t have to be an expert in the field to argue that mining operations in Tatev’s backyard will doom the entire project to failure.

I spoke to Begor Papazyan, Director of Armenia’s National Competitiveness Foundation (ANCF), about the issue.

Has the ANCF studied the matter of the Svarants mine? Have you given your approval to Fortune Oil’s mining operation?

The ANCF has studied the issue from the perspective of developing regional tourism. We have decided to set up a committee to conduct economic research. At the same time, based on preliminary conclusions, we can openly state our position. We believe that mining operations and tourism cannot co-exist in the same area.

We are of the opinion that the granting of mining licenses in the southern tourism corridor of Armenia, especially in Tatev, is counter-productive. Then too, we do not believe that the granting of an exploratory license signifies that an operating license should be granted.

Prior to the launch of the Tatev Rebirth project, was the ANCF aware that an exploratory mining license had been granted to the company?

The Tatev Rebirth project kicked-off in February, 2009. Of course, back then, we knew about the mines in the southern corridor. But there had been no decisions taken regarding their operation. We see the role of the ANCF in this matter as     in the framework of state-private sector cooperation; providing the Armenian government with advice regarding the development of conditions conducive for the economic and tourist sectors in the area, in addition to raising public awareness of the issues involved.

When you meet with individuals and organizations and propose various business plans to them, do you also mention that a mine will be operating in the Tatev area?

When the ANCF meets with potential investors and benefactors we mention all the risks involved, stemming not only from mining operations but those resulting from a poorly planned mix of environmental/economic interests. By discussing these risks, we are trying to find solutions to the present problems. We must prove that for the Tatev Rebirth project to succeed, the needed investment is quite large. It will be difficult to attract tourists to the 9th century wonder that is Tatev if they know that there is an operating mine close by. It will be just as hard to attract investors and donors, especially if it’s an open-pit mine.

Did Ruben Vardanyan* know about the Svarants mine project?

He was informed as a Tatev Rebirth benefactor and member of the ANCF Board of Trustees.

Has the ANCF been able to ascertain if licenses have been granted for the other mines in the Tatev area?

The research conducted at the behest of the ANCF and the British AECOM consulting company highlights almost all the mines in the southern region of Armenia. To get more specific information regarding their operating status, we have gone to the appropriate agencies. The ANCF will issue a statement once the data and information has been collected and analyzed.

*Ruben Vardanyan – Wealthy Russian-Armenian businessman. Board Chairman and CEO of Troika Dialog Group. Major sponsor of Tatev Rebirth project.