TIDMAAZ
RNS Number : 3674U
Anglo Asian Mining PLC
15 October 2014
Anglo Asian Mining plc / Ticker: AAZ / Index: AIM / Sector:
Mining
15 October 2014
Anglo Asian Mining plc
Quarter 3, 2014 Operations and Production update - Gedabek and
Gosha Gold, Copper and Silver mines, Azerbaijan
Anglo Asian Mining plc ("Anglo Asian" or the "Company"), the AIM
listed gold, copper and silver producer focused in Azerbaijan, is
pleased to provide a production and operations update for its
Gedabek and Gosha gold, copper and silver mines in western
Azerbaijan for the three months to 30 September 2014 ("Q3
2014").
Production overview
-- Gold production for Q3 2014 increased to 16,178 ounces (9,147
ounces from the agitation leaching plant; 7,009 ounces from heap
leach operations and 22 ounces from SART) (Q2 2014: total 15,736
ounces)
-- Q3 2014 gold production included 998 ounces produced from ore mined at Gosha
-- Silver production for Q3 2014 totalled 5,504 ounces (171
ounces from the agitation leaching plant; 532 ounces from heap
leach operations and 4,801 ounces from SART) (Q2 2014: total 8,785
ounces)
-- Copper production for Q3 2014 from SART processing at Gedabek totalled 210 tonnes
-- Anglo Asian's cumulative production in the nine months to 30 September 2014 was as follows:
o Gold production of 43,232 ounces
o Silver production of 27,419 ounces
o Copper production of 580 tonnes
-- Gold production target for the year to 31 December 2014 ('FY
2014') remains at circa 62,000 ounces
-- Copper production target from SART for FY 2014 remains at 750 tonnes
Gold and copper sales
-- Q3 2014 gold sales of 13,797 ounces at an average of US$1,281 per ounce
-- Q3 2014 copper concentrate shipments to the customer totalled
250 dry metric tonnes ('dmt'), containing 123 tonnes of copper and
6,639 ounces of silver
-- Cumulative gold sales in the nine months to 30 September 2014
of 37,343 ounces at an average of US$1,291 per ounce and cumulative
sales of copper concentrate of US$2.9m
Other highlights
-- The Company is evaluating the construction of a small scale,
low capital expenditure flotation plant to produce copper, gold and
silver concentrate from sulphide ore - this plant will be a pilot
plant for a future full scale copper recovery plant.
Anglo Asian CEO Reza Vaziri commented, "We are pleased to report
our Q3 2014 production and operational results which have seen us
produce 16,178 ounces of gold for the quarter and 210 tonnes of
copper. Whilst we achieved solid gold sales for the period, the
Company's three year sales contract for copper concentrate also
positively impacted our bottom line for the quarter. In light of
the ore currently being mined at Gedabek, which has a high copper
content, we are actively pursuing options from which to increase
gold recovery to achieve our target of circa 62,000 ounces for the
year. Although the considerable amount of ore mined with a high
copper content has been unexpected, we believe our stockpiles of
ore totalling 379,000 tonnes also presents an attractive
opportunity. In light of this, we are evaluating the construction
of a small scale flotation plant suited to process this type of ore
to produce a copper and precious metals concentrate. This will be a
pilot plant for a future full scale copper recovery plant. This
would create a further production stream which will enhance our
production profile as a leading precious metals and copper producer
in Caucasia."
Full details
During Q3 2014, the Company produced 16,178 ounces of gold at
Gedabek. The agitation leaching plant produced 9,147 ounces; the
heap leach operations 7,009 ounces and SART 22 ounces. Of the gold
produced in Q3 2014, 998 ounces were produced from ore mined at
Gosha. For the nine months ended 30 September 2014, the Company
produced 43,232 ounces of gold. The agitation leaching plant
produced 28,594 ounces; the heap leach operations 14,606 ounces and
32 ounces from SART. The Company has completed gold sales of 13,797
ounces at an average of US$1,281 per ounce during Q3 2014 and
37,343 ounces of gold at an average of US$1,291 per oz for the nine
months to 30 September 2014.
The following summary table of gold production and sales
demonstrates the quarter-on-quarter increase in gold production at
Gedabek.
Quarter ended Gold produced* Gold sales Weighted average
(ounces) (ounces) gold sale price
(US$)
Total for FY 2013 52,068 46,076 1,387
31 March 2014 11,318 10,403 1,303
30 June 2014 15,736 13,142 1,292
30 September 2014 16,178 13,797 1,281
Total for 9 months
ended 30 September
2014 43,232 37,342 1,291
*including Government of Azerbaijan's share
The Company continues to process ore through its agitation
leaching plant and heap leach operation at Gedabek. During Q3 2014
the Company stacked 144,861 tonnes of dry ore onto the heap leach
pads with an average gold content of 1.27 grammes per tonne. As
previously reported, low grade ore (less than 1.5 grammes per
tonne) has been treated by heap leaching, with higher grade ore
being sent to the agitation leaching plant. During Q3 2014 the
Company processed 151,473 tonnes of ore with an average gold
content of 2.99 grammes per tonne through the agitation leaching
plant. Of that, 9,340 tonnes of ore with a higher average gold
grade of 4.15 grammes per tonne was transferred from Gosha and
processed at Gedabek's agitation leaching plant in Q3 2014. We
achieved a 71.0 per cent. gold recovery for agitation leaching in
Q3 2014 compared to 73.5 per cent. for H1 2014. Our recovery rate
for heap leach remained at 66.0 per cent. in Q3 2014. In terms of
recovery rates, the management team remain committed to improving
the recovery rate of the agitation leaching plant. Note that gold
doré is produced from both heap and agitated leach intermediate
products which are combined for final processing and also
recirculated around the plant, heap leach pads and tailings dam.
Recovery rates are therefore only estimates calculated from
available metallurgical statistics.
As mentioned in our recent interim results, whilst the new
agitation leaching plant helped increase our gold recoveries and
production potential at Gedabek, there are continuing problems with
low recovery of gold from the ore currently being mined which has a
high copper content, and is often associated with deeper mining.
This has led to increased operational costs due to the high
consumption of cyanide. With the lower than expected recoveries
continuing longer than expected, as announced in the Company's
interim results, the Company is targeting gold production of circa
62,000 ounces for FY 2014.
The Company is evaluating a number of different options to
process sulphide ore mined which has a high copper content. These
include both increasing the gold recoveries when it is processed by
the agitation leach plant; and to separately process the ore to
produce a copper and precious metals concentrate. During the
quarter, the Company has been evaluating the future exploitation of
the known high copper content mineral resource at Gedabek. To fully
exploit the potential of the copper resource, in addition to the
gold resource, the Company has hired CAE Mining, England to develop
a new life of mine plan based on the most recent JORC resource
model dated April 2014 (see Anglo Asian press release dated 5 June
2014). The new mine plan, expected to be completed in December
2014/January 2015, will take account of both the copper and gold
cut-off grades. The Company has also decided to construct a small
scale, low capital cost flotation plant as a pilot plant for a
future full scale copper recovery plant. The plant will also be
able to treat the Company's existing stockpile of sulphide ore with
a high copper content. The Company is also examining opportunities
to finance the plant, including 100 per cent. debt financing. Anglo
Asian looks forward to updating shareholders with this latest
initiative in due course.
In terms of Anglo Asian's current copper production profile, the
Company's Sulphidisation, Acidification, Recycling, and Thickening
("SART") plant has been performing strongly, and for Q3 2014 copper
concentrate totalled 210 tonnes of copper, 4,801 ounces of silver
and 22 ounces of gold. The Company's target for copper production
from its SART operation remains at 750 tonnes for FY 2014.
Cash and net debt
The Company's cash and net debt position was as follows:
30 June 2014 30 September
2014
US$m US$m
Amsterdam Trade Bank, Agitation Plant
loan 37.0 37.0
International Bank of Azerbaijan 11.6 11.6
International Bank of Azerbaijan, credit
line 0.7 1.4
Atlas Copco equipment finance loan 1.8 1.3
------------- -------------
Total Loans 51.1 51.3
Cash on hand and at bank (5.1) (1.4)
------------- -------------
Net Debt 46.0 49.9
------------- -------------
**ENDS**
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