Junior takes on Armenian venture

A junior company is being granted exploration and mine development rights covering the whole of Armenia, an area of almost 30,000 sq. km.

If the assignment agreement is approved by regulators, Rome Resources (VSE) will hold the rights under two separate agreements providing for mining joint ventures and a mineral exploration license.

The agreement was reached between Rome and Spanish businessman Gregorio Becerro, who held the rights before becoming president of Rome. The consideration payable to Becerro, based on an independent evaluation of the interests acquired, will be 12 million shares,

“We have a defined agreement,” said James Robertson, a director of Rome. “As we proceed, we expect there will be addenda and protocol to develop this into a more comprehensive agreement.”

The joint-venture agreement carries a 20-year term with Armenia’s Ministry of Industry to operate existing gold mines, tailings recovery projects and future gold mines in the republic. Rome will hold a 45% interest in the joint venture and will arrange financing for all future developments. The ministry will hold 55% and provide the rights to all existing known deposits and plant facilities.

Priority projects will be the existing 2,000-tonne-per-day Ararat gold mill and an 11-million-tonne gold tailings deposit with a grade of 1.5 grams per tonne (0.044 oz. per ton).

The exploration license covers precious and base metals, rare earths, and precious and semi-precious stones, as well as oil and gas, for the entire territory, with the exception of existing agreements. The license is valid to the end of 1997 and is renewable thereafter. Although information is limited, the regional geology is considered favorable and precious metals and copper deposits have been outlined.

Armenia, a landlocked former Soviet republic, is attempting to attract foreign investment and Western technology to revitalize its economy. The mountainous republic lies east of Turkey and north of Iran. Population: 3.5 million.