On October 10, 2026, something happened at Armenia’s Amulsar gold mine that had been nearly two decades in the making.
The first gold was poured.
Government officials attended the ceremony. There were speeches about investment, jobs, economic growth, and a new chapter in Armenia’s industrial development.
On the surface, it looked like a success story.
But I found myself asking a different question.
When gold is extracted from Armenian soil, who actually becomes wealthier — the state, the investors, or the people who live beside the mine?
And there is a second, more uncomfortable question.
Who will pay if, ten or twenty years from now, the financial gains prove temporary while the environmental consequences remain?
I do not believe Armenia should refuse to develop its natural resources. A small economy with limited opportunities cannot afford to dismiss major investment simply because it involves difficult decisions.
But I also do not believe that every investment becomes a national interest merely because it comes with a price tag of hundreds of millions of dollars.
The real story of Amulsar lies somewhere between those two positions.
The Gold That Took Nearly Twenty Years to Reach
Amulsar's history began long before the latest ceremony.
Exploration started in the 2000s. Construction began in 2016, but the project was effectively halted in 2018 amid protests by local residents and environmental activists.
What followed was a prolonged period of environmental assessments, legal and political disputes, financing difficulties, ownership changes, and repeated promises that operations would resume.
In February 2023, the Armenian authorities announced plans to secure financing for the project's completion. An earlier arrangement involving the Eurasian Development Bank did not ultimately materialize.
The state eventually became directly involved in the project's financial structure.
Today, the Armenian government holds a 12.5% stake in Lydian Armenia.
That changes the nature of the debate.
The government is no longer merely the regulator responsible for issuing permits, enforcing environmental standards, and protecting the public interest.
It is also a shareholder.
And that is where the most important questions begin.
When the State Becomes Both Referee and Shareholder
Consider a straightforward situation.
A private company operates a mine.
The government must ensure that the company pays taxes, complies with environmental legislation, protects public health, and meets its obligations to local communities.
If the company violates the rules, the government must intervene.
But what happens when the government itself owns part of that company?
It acquires an additional financial interest.
The more successful the enterprise becomes, the more valuable the state's shareholding may become, along with any potential dividends.
There is nothing inherently improper about government ownership in strategic industries. Many countries hold stakes in mining, energy, and infrastructure companies.
The difficulty begins when the public can no longer clearly distinguish between the government's interest as a shareholder and its responsibility as an independent regulator.
Who decides whether production should be suspended if environmental monitoring reveals a serious violation?
Who assesses the damage?
Who imposes penalties?
And will the state be willing to make a decision that damages its own financial interests if public safety requires it?
I am not suggesting that such a conflict has already occurred at Amulsar.
I am arguing that the ownership structure makes independent oversight especially important.
The more a government stands to earn from extraction, the more convincingly it must demonstrate its willingness to stop extraction when necessary.
Otherwise, public trust becomes another cost of doing business.
$750 Million Is an Impressive Number. But It Is Not Armenia's Profit
According to Lydian Armenia, total investment in the project has reached approximately $750 million.
For an economy of Armenia's size, that is a substantial figure.
The company reports significant job creation, while its management has outlined plans to increase production in the coming years.
Economy Minister Gevorg Papoyan has estimated that, once the project reaches its planned operating levels, annual contributions to the state budget could amount to approximately $130 million in taxes, duties, and royalties.
Annual gold production is expected to exceed 210,000 ounces.
These figures are significant.
But four entirely different concepts must not be confused.
Investment is not profit.
Revenue is not profit.
Corporate profit is not government revenue.
And government revenue does not automatically translate into better living standards for ordinary citizens.
When we hear that a mine may produce hundreds of millions of dollars' worth of gold annually, we need to know how much of that value will go toward operating costs, debt servicing, imported equipment, wages, taxes, and returns to shareholders.
Only then can we begin to calculate the real economic value retained by Armenia.
Until these calculations are presented publicly in a clear and comparable form, impressive financial projections remain arguments in a debate rather than complete economic answers.
I would like to see more than Amulsar's projected output.
I would like to see a comprehensive assessment of how much net economic value Armenia will retain over the mine's entire operating life.
And not only under the most optimistic scenario.
A Gold Deposit Has a Lifespan. Environmental Obligations May Last Much Longer
Gold is a finite resource.
Eventually, the deposit will be depleted.
Extraction will stop.
Some jobs will disappear.
Equipment will be dismantled or decommissioned.
And Armenia will face a question that should have been addressed long before full-scale production began.
What remains after the mine?
New infrastructure?
A skilled workforce?
Businesses capable of operating independently of mining?
Or a regional economy whose future was tied to a single, temporary industrial project?
The mining industry has a concept known as mine closure and rehabilitation.
But closing a mine involves far more than switching off machinery.
It can require land restoration, water management, the stabilization of waste facilities, environmental safeguards, and monitoring that continues long after commercial operations end.
That is why I am interested not only in the cost of developing Amulsar.
I am interested in the cost of closing it.
Who has calculated that cost?
What financial guarantees are in place?
Will sufficient funds be available if rehabilitation proves more expensive than originally expected?
And who will bear responsibility if the company changes ownership, experiences financial difficulties, or ceases operations?
These are not arguments against mining.
They are the questions that distinguish responsible industrial policy from short-term resource extraction.
Jermuk Is Not Empty Land Beside a Mine
When discussing Amulsar, it is easy to forget that nearby lies Jermuk.
A town whose economic identity has been shaped for decades by mineral water, health resorts, tourism, and its natural landscape.
These are economic assets too.
Their value is not always visible in annual financial statements.
A resort destination's reputation takes decades to build.
Consumer confidence in mineral water does not emerge overnight.
Tourism depends not only on hotels and infrastructure but also on perceptions of environmental quality.
For years, opponents of Amulsar have raised concerns about potential risks to water resources, including acid drainage and the use of cyanide in gold processing.
The company, for its part, maintains that its engineering systems and environmental safeguards are designed to manage these risks.
Various expert assessments have been published over the years, and their findings and interpretations have been disputed.
I am not presenting those disputes as proof that contamination will inevitably occur.
But neither should a ceremonial gold pour be treated as proof that all environmental questions have been permanently resolved.
The absence of demonstrated damage today is not the same as proof that no risk exists tomorrow.
Jermuk needs more than assurances.
It needs continuous, independently verifiable environmental data.
Water quality.
Soil conditions.
Airborne dust.
Surface-water and groundwater measurements.
The results should be publicly accessible, understandable, and independently auditable.
Not once a year.
Not only after controversy erupts.
Continuously.
Because environmental safety that cannot be independently verified eventually becomes a matter of trust.
And trust cannot be manufactured through press releases.
The Most Expensive Mistake Is Treating Environmental Protection as an Obstacle to Growth
Armenia too often finds itself trapped in a false choice.
Either we develop industry.
Or we protect nature.
Either we create jobs.
Or we preserve water resources.
That is the wrong way to frame the problem.
A modern economy must be capable of pursuing industrial development while enforcing rigorous environmental standards — provided a particular project can meet those standards and its risks are acceptable.
If an industrial facility can operate safely and responsibly, it should be able to operate.
If it cannot, the size of the investment should not exempt it from restrictions.
That is what mature economic governance looks like.
Armenia's problem is not simply that it has too many environmental requirements.
Nor is it that it has too many investors.
It is the persistent lack of public confidence in the institutions responsible for balancing economic development and environmental protection.
Amulsar has become one of the clearest expressions of that problem.
Who Really Gets the Jobs?
Lydian Armenia's management has reported that approximately 1,500 people are employed at the project, with roughly 30% coming from local communities.
For regional employment, that is a meaningful contribution.
But I would like to examine the numbers more closely.
What kinds of jobs are being created?
How many require advanced technical qualifications?
How many employees will have long-term contracts?
What proportion of engineering, management, and specialist positions are held by Armenian professionals?
How many local businesses will secure contracts in equipment maintenance, construction, transportation, IT infrastructure, security, and logistics?
Because Armenia needs more than employment at one mine.
It needs an industrial ecosystem that can survive beyond the mine.
If a local company learns to maintain sophisticated equipment, it may later sell those services to other industries.
If Armenian engineers acquire internationally recognized expertise, that knowledge remains part of the country's economic capacity.
If regional businesses develop sustainable demand, they may continue growing after extraction ends.
That is long-term economic value.
Jobs created during the operating life of a mine matter.
But they are only one part of the equation.
Community Payments: Development or Another Dependency?
Representatives of the project and the government have discussed annual funding of approximately $7–9 million for neighboring communities.
For local budgets, such sums could be transformative.
They could finance roads, schools, infrastructure, and public services.
But another question follows.
What happens to those communities when the mine eventually closes?
If a region becomes accustomed to substantial annual transfers from one company, does it risk developing a new form of economic dependency?
I believe these funds should be treated as more than compensation or corporate social responsibility.
They should become capital for the future.
Education.
Vocational training.
Small-business development.
Infrastructure that remains useful after mining ends.
Tourism.
Manufacturing.
Energy and technology projects.
The best legacy of a mine is a region that no longer needs the mine once it closes.
That is how I would measure the success of Amulsar's community development commitments.
There Is Another Stakeholder: The Taxpayer
One of the most important financial aspects of the project involves a government guarantee.
Ameriabank provided $150 million in financing under a state-backed guarantee.
A guarantee does not mean the government has already spent that money.
But it does create a contingent liability: under specified contractual circumstances, financial responsibility could shift to the state.
That changes the discussion.
If the project succeeds, investors receive returns, while the government collects taxes and may receive dividends.
But how are the risks distributed if circumstances change?
What if gold prices fall?
What if operating costs rise sharply?
What if production is suspended for an extended period?
What if expensive environmental upgrades become necessary?
Which risks belong to shareholders?
Which belong to lenders?
Which belong to the government?
And which could ultimately be transferred to taxpayers?
These questions deserve transparent answers.
Because public participation in a commercial venture means more than an entitlement to revenue.
It can also mean exposure to losses.
The Most Uncomfortable Question: What Will Armenia Do With the Gold Revenue?
Suppose the optimistic projections prove correct.
The mine reaches its planned production capacity.
Exports increase.
The government receives additional revenue.
Local communities benefit from financial contributions.
What happens next?
Does Armenia become a more advanced economy?
Or does it simply become more dependent on extractive industries?
Those are not the same thing.
A country can increase exports through raw materials while remaining vulnerable to global commodity prices.
It can collect substantial tax revenue without developing enough high-productivity industries.
It can possess valuable mineral deposits while struggling to build a strong innovation economy.
That is why Amulsar's economic success should not be measured solely in ounces of gold.
It should also be measured by what the state does with the revenue.
Modern schools?
Engineering education?
Transport infrastructure?
Energy resilience?
Industrial development?
Technology companies?
Or will the money disappear into routine public spending, leaving behind impressive statistics and a depleted resource?
Gold underground is natural wealth.
Gold transformed into education, infrastructure, and productivity becomes national capital.
The distinction is fundamental.
Amulsar Is a Test of the State, Not Just the Investor
I do not believe Amulsar should be declared Armenia's economic salvation.
But it would be equally irresponsible to present it as an inevitable environmental catastrophe without evidence.
The reality is more complicated.
The project has the potential to generate substantial investment, export revenue, tax receipts, and employment.
At the same time, it raises serious questions about environmental risk, financial responsibility, long-term rehabilitation, and regulatory independence.
All of these issues must be considered together.
Not as a choice between economic growth and environmental protection.
But as a demand for economic development with demonstrable accountability.
If Armenia can ensure transparent finances, independent monitoring, rigorous environmental enforcement, and the conversion of resource revenues into lasting development, Amulsar could become an example of more mature industrial governance.
If financial performance takes precedence over independent oversight, and legitimate questions are treated as obstacles to investment, the project could deepen the country's existing crisis of institutional trust.
In that case, the central problem would not be the gold.
It would be the quality of governance.
Twenty Years From Now
I tried to imagine Armenia twenty years from today.
Amulsar is operating or approaching the end of its productive life.
Significant quantities of gold have been extracted.
Taxes have been collected.
Salaries have been paid.
Investments have been made.
But what do we see around the mine?
A prosperous Jermuk with a thriving tourism economy?
Modern businesses in Vayots Dzor and Syunik?
Young engineers who received their education and chose to build careers in Armenia?
A rehabilitated environment supported by credible, functioning monitoring systems?
Or a region that once generated considerable revenue but never secured an independent economic future?
That is when the project's real success will become clear.
Not from photographs of the first gold pour.
Not from speeches by government ministers.
And not even from export statistics alone.
But from what remains after the gold has been taken out of the ground.
Because natural resources do not belong to only one generation.
Today's profits should not be built on tomorrow's liabilities that nobody wanted to acknowledge.
Armenia has every right to earn money from its gold. But a country's true wealth is not determined by how much gold it extracts. It is determined by how much lasting value it preserves after extraction ends.
That is why, for me, the defining question of Amulsar is not simply:
“How much will we earn?”
It is something far more important.
“What will Armenia have left when the gold is gone?”
By Lida Nalbandyan, Founder and CEO of Octopus Media Group