RNS Number : 1920B
Anglo Asian Mining PLC
12 April 2012
Anglo Asian Mining plc / Ticker: AAZ / Index: AIM / Sector: Mining
12 April 2012
Anglo Asian Mining plc ('Anglo Asian' or 'the Company')
Q1 2012 Operations Update - Gedabek Gold/Copper Mine in Azerbaijan
Anglo Asian Mining plc, the AIM listed gold producer, is pleased to provide an update for the three months to 31 March 2012 ('Q1 2012') on operations and production at its flagship Gedabek gold/copper/silver mine ('Gedabek') in Azerbaijan.
-- Gold production from heap leach processing totalled 9,925oz at Gedabek for Q1 2012
-- Gold sales of 8,252 oz of gold at an average of US$1,679 per oz completed for the quarter
-- Silver dore production for Q1 2012 totalled 7,670 oz
-- 176,438 tonnes of dry ore transferred during Q1 2012 onto the leach pad with an average gold content of 2.83 g/t
-- Copper, silver and gold production from SART operations totalled 148 tonnes of copper, 34,666 oz of silver and 27 oz of gold
-- Net debt, being interest-bearing loans and borrowings less cash and cash equivalents, remains unchanged from the beginning of the quarter at US$3.2 million.
-- Cash in the bank as at 31 March 2012 - US$9.8 million
Anglo Asian CEO Reza Vaziri said, "Whilst gold production for the period has been effected by an unusually long and severe winter period in Azerbaijan we are confident that this shortfall in production for the first quarter 2012 will be compensated for during the course of the year and that our internal target of 54,000 oz of gold for 2012 will be achieved. During the period we accomplished a significant milestone and announced a 50% upgrade in our JORC resource at Gedabek to over 1 million oz of gold in the Measured and Indicated classifications. A further 24,567 metre drilling programme is planned with the aim of adding additional ounces to the resource base. In addition, we aim to complete a JORC compliant ore reserves estimate in Q2 2012 which will help us assess the mineral processing options for the proposed agitation leaching plant at Gedabek with a view to increasing gold production and mine life and further improve Gedabek's economics."
During Q1 2012, the Company produced 9,925 oz of gold ('Au') and 7,670 oz of silver ('Ag') at Gedabek from its heap leach operations. Extreme winter weather conditions over the period at Gedabek have resulted in leaching becoming sluggish, and as a result, Q1 2012 gold production is below that of Q4 2011 which totalled 15,292 oz. However, the continued buoyant gold price has seen Anglo Asian complete gold sales* of 8,252 oz at an average of US$1,679 per oz and silver sales of 7,381 oz at an average price of US$33 for Q1 2012.
The following summary table of gold production and prices outlines the quarter-on-quarter gold production at Gedabek over the past year.
Quarter Ended Gold Produced (including Weighted Average
Govt. of Azerbaijan's Gold Sale Price
31 Mar 2011 14,028 1,385
30 Jun 2011 14,582 1,506
30 Sept 2011 13,166 1,704
2011 15,292 1,688
Total for FY
2011 57,068 1,573
31 March 2012 9,925 1,679
Gedabek's heap leach processing operations have been performing in line with management's expectations. During the first quarter of 2012 the Company transferred 176,438 tonnes of dry ore onto the leach pad with an average gold content of 2.83 g/t Au (Q4 2011: 190,737 tonnes of dry ore with an average gold content of 3.22 g/t). The reduction of grade is in line with the 2012 mining plan and is determined by the strategic development of mine resources.
In terms of improving both gold recovery and production at Gedabek in the long-term the Company is assessing the suitability of building a new agitation leaching plant at Gedabek. The plant, if commissioned, will process high grade ore and additional resources that are not suitable for heap leaching, together with spent ore from the leach heaps to further improve total gold recoveries. Agitation leaching recovery rates are typically over 90% compared to circa 70% normally achieved in heap leaching. In addition Anglo Asian has been conducting exploration work to gain a better understanding of Gedabek's orebody. A 50% resource upgrade totalling 37,111,577 tonnes at 0.884 g/t of gold for 1,054,382 oz; 0.220% of copper for 81,765 tonnes; and 7.215 g/t Ag for 8,608,551 oz in the Measured and Indicated classifications at a cut-off grade of 0.3 g/t of gold was announced 3 April 2012. The Company is now conducting a further work programme and plans to compile a JORC compliant ore reserves estimate in Q2 2012 from which a decision regarding commissioning a new agitation leaching plant will be made.
During the quarter, Anglo Asian has produced 148 tonnes of copper, 34,666 oz of silver and 27 oz of gold from the Company's Sulphidisation, Acidification, Recycling, and Thickening ('SART') plant (Q4 2011: copper concentrate production contained 170 tonnes Cu, 38,392 oz Ag and 62 oz Au). A dryer has been ordered and is targeted to be installed in July 2012 to reduce the moisture content of the concentrate. The Company's copper concentrate stockpiles currently total 709 tonnes Cu, 198 oz Au and 152,000 oz Ag and Anglo Asian is in detailed discussions with various parties regarding finding a long-term sales partner and will update on this progress in due course.
The Company's cash and net debt position of US$9.8 million and US$3.2 million respectively remains unchanged from the end of 2011.
For further information please visit www.angloasianmining.com or contact:
Reza Vaziri Anglo Asian Mining plc Tel: +994 12 596 3350
Andrew Herbert Anglo Asian Mining plc Tel: +994 12 596 3350
Ewan Leggat Fairfax I.S. PLC Tel: +44 (0) 20 7598
Laura Littley Fairfax I.S. PLC Tel: +44 (0) 20 7598
Felicity Edwards St Brides Media & Finance Tel: +44 (0) 20 7236
Isabel Crossley St Brides Media & Finance Tel: +44 (0) 20 7236
*The Company has a Production Sharing Agreement ('PSA') in place with the Government of Azerbaijan which governs how the production of each of the Company's Contract Areas under the PSA is divided between the Company and the Government of Azerbaijan. Currently, the Company takes ownership of 87.25% of the production at Gedabek, which accounts for the difference between the total gold produced at Gedabek and the amount of gold sold by the Company. It should also be noted that there will always be short-term timing differences between gold production and sales.
Anglo Asian Mining plc (AIM:AAZ) is a gold producer in Central Asia with a broad portfolio of production and exploration assets in Azerbaijan. The Company has a 1,962 sq km prospective exploration portfolio, assembled on the back of analysis of historic Soviet geological data and held under a Production Sharing Agreement ('PSA') based on the Azeri oil industry. The Company developed Azerbaijan's first operating gold/copper mine, Gedabek, which commenced gold production in May 2009. Gold production for the year ended 31 December 2011 totalled 57,068 oz of gold.
Anglo Asian is actively looking to exploit its first mover advantage in Azerbaijan to identify additional projects, as well as looking for other properties in Central Asia and Caucasia in order to fulfil its expansion ambitions and become a mid-tier gold and base metal production company focussed in these regions.
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