H1 2020 Geological Exploration Activities

RNS Number : 2884V

Anglo Asian Mining PLC

06 August 2020

 

Anglo Asian Mining plc / Ticker: AAZ / Index: AIM / Sector: Mining

6 August 2020

Anglo Asian Mining plc

H1 2020 Geological Exploration Activities

Gedabek, Gosha and Ordubad Contract Areas

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 summary of its extensive and productive geological exploration activities from 1 January to 30 June 2020 ("H1 2020") at its Gedabek, Gosha and Ordubad Contract Areas. The work focused on the mineral deposit targets to progress exploration and resource definition in accordance with the strategic update released by the Company in May 2020.

The comprehensive exploration programme underway at Gedabek continued and substantial drilling was carried out. However, COVID-19 travel restrictions at Ordubad restricted the geological work that could be undertaken. Detailed reports of the Company's work programmes, including drill hole data and other exploration results for each contract area can be found following the links below in each relevant section and on the Company's website ( www.angloasianmining.com ).

Highlights

Gedabek

· Main drilling activity continued to be in the Avshancli mineral district and the Gilar gold-bearing quartz vein system

o  13 surface core drill holes and 25 reverse circulation drill holes with a total length of 1,473 metres completed at the Avshancli mineral district

o  Initial drill programme started at Gilar with seven surface core drill holes completed with a total length of 2,162 metres

· Substantial drilling completed at the Gadir and Gedabek underground mines

o  92 core drill holes totalling 4,298 metres were completed in the underground Gadir mine

o  Drilling results give increased geological confidence for the Gadir and Gedabek underground mines

· Core drilling continued at Ugur Deep, targeting the recently discovered high grade copper and silver mineralisation

o  Six core drill holes were completed and the programme is continuing into H2 2020

· One core drill hole and three reverse circulation surface drill holes completed at the Gedabek open pit and one core drill hole completed at Duzyurd

· Regional geological mapping and Gadir geophysical interpretation has now been completed

· New mineralised area identified between the Gedabek open pit and the Ugur open pit - Zafer

o  Four core drill holes totalling 2,592 metres were drilled over the Zafer area during H1 2020

o  One drill hole intersected 194 meters of continuous sulphide mineralisation showing various intersections of gold and copper mineralisation

Gosha

· Drilling continued close to the Gosha underground mine targeting areas of extension to "Zone 5" and the area between "Zone 5" and "Zone 13"

o  2,980 metres of core drilling completed confirming the extension of mineralisation with significant gold grades of up to 15 grammes per tonne

· A new geological map of the Gosha contract area was completed

o  15 porphyry and 13 gold/lead/zinc mineralisation targets identified

Ordubad

· Reconciliation and interpretation of the WorldView-3 satellite data against geological field observations continued

· To follow up the identification of gold-quartz veining around the Aylis, Uchurdag and Unus targets, the trenching programme continued

o  86 trenches were completed 

o  822 trench samples collected from Aylis, Uchurdag and Unus targets

· Due to access restrictions as a result of the COVID-19 pandemic, no drilling was carried out in H1 2020

Stephen Westhead, Director of Geology & Mining, commented, "Our geological work programme continues over our three contract areas. Exploration of the near-surface gold targets at Gedabek are taking priority to rapidly develop mineral resources and advance mineral deposits towards production. Both Avshancli and Gilar will be explored by ground-based induced polarisation and magnetic geophysics in the second half of the year. Deeper drilling at Ugur and Zafer have yielded significant copper intersections and zones of extensive sulphide mineralisation, which provide for a secondary layer of future resource development. Our staff worked tirelessly in the six months to overcome extremely wet weather conditions, which inhibited site access for drill rigs. The Gosha drill results demonstrated the presence of mineralisation adjacent to the current Gosha mine with significant gold grades, which potentially allows for the expansion of this mining operation in the future.

"Ordubad exploration was hampered by COVID-19 travel restrictions and only trench work was carried out during the first half of the year on the recently discovered gold vein systems. Geological modelling and mineral targeting are on-going to test for the presence of mineralising systems associated with strong alteration zones and lithocaps, with the aim of prioritising locations for resource drilling planned in the second half of the year. I would like to thank all of our staff for their management of the COVID-19 situation and we look forward to expediting the work in the second half of the year to deliver further positive progress."

Gedabek Contract Area

Avshancli district

Avshancli is a recently discovered significant mineral district which is 10.5 kilometres north-east of the Gedabek open pit. Avshancli is a gold-copper occurrence comprising three defined areas, Avshancli 1, 2 and 3.  In Q4 2019, a significant amount of exploration work took place, comprising the collection of 128 outcrop samples, the completion of 1,732 metres of trenching and the commencement a surface diamond drilling programme.  Drilling continued throughout H1 2020 and 38 core and reverse circulation drill holes were completed at Avshancli during H1 2020.  The assay results were quite variable, but high-grade intersections of up to eight grammes gold per tonne were encountered.  Drilling activity at Avshancli is being intensified in H2 2020.

Gilar

Gilar is a new mineral occurrence located approximately two kilometres south of Avshancli 1.  The initial drilling programme at Gilar comprised seven core drill holes. Assay results were again quite variable, but high-grade intersections of up to 14 grammes gold per tonne were encountered.

Gedabek open pit and Duzyurd

Exploration in and around the operating Gedabek open pit was limited by production priorities in H1 2020.  Only two core drill holes and three reverse circulation drill holes were completed, both types designed to explore the geology at depth and test for sub-pit and adjacent mineralisation . The results from Gedabek yielded gold intersections, while the Duzyurd drill hole was not successful in intersecting mineralisation but did identify alteration.

Gadir underground mine

A considerable amount of exploration activity was completed at Gadir during H1 2020, comprising underground drilling and mapping.  Interpretation is now complete for the ground-based induced polarisation ("IP") geophysical survey. This work has resulted in defining mineralisation that extends the current Gadir ore body footprint both laterally and down-dip.  Additionally, the drilling continues to help constrain ore body modelling around production stoping fronts, so that tonnages and grade can be more accurately determined.  These positive results demonstrate the expansion potential of the underground mine at Gadir.

Ugur open pit

The Ugur deposit is nearly mined out with some 200,000 tonnes of resources at 0.9 grammes per tonne gold remaining, which will be scheduled for removal during H2 2020. Planning for the mine closure following exhaustion is on-going.

Ugur Deep

Six surface core drill holes were completed to the south-east of the Ugur open pit during H1 2020 targeting deeper extents of high-grade copper and silver mineralisation.  Intersections assaying more than two percent copper were encountered at depths of around 300 metres.  Drilling will continue in H2 2020.

A detailed report on the H1 2020 exploration activities at the Gedabek contract area can be found at https://wp-angloasianmining-2020.s3.eu-west-2.amazonaws.com/media/2020/08/05145223/H1-2020-Exploration-Activities-Gedabek.pdf and on the Company's website ( www.angloasianmining.com ).

Gosha Contract Area

In H1 2020, a total of 2,980 metres of core was drilled. This was drilled at "Zone 5" and between "Zone 5" and "Zone 13", which is approximately 500 metres from "Zone 5". The aim of this drill programme continues to be to test the Gosha vein system at depth, below the current "Zone 5" and further assess the new zones. Significant gold grades of up to 15 grammes gold per tonne were encountered.

A new geological map of the Gosha contract area has been compiled from all previous data. This was the first stage of a desktop study to consolidate historical and new geological data and to better understand the regional geology. From this map, 15 porphyry and 13 gold/lead/zinc mineralisation targets have been identified.

A detailed report on the H1 2020 exploration activities at the Gosha contract area can be found at https://wp-angloasianmining-2020.s3.eu-west-2.amazonaws.com/media/2020/08/05145230/H1-2020-Exploration-Activities-Gosha.pdf and on the Company's website ( www.angloasianmining.com ).

Ordubad Contract Area

Due to COVID-19 restrictions, drill access was restricted and therefore no drilling was able to be carried out in H1 2020. Trench work was carried out during H1 2020 on the recently discovered gold vein systems. Geological modelling and mineral targeting are on-going to test for the presence of mineralising systems associated with strong alteration zones and lithocaps, with the aim of prioritising locations for resource drilling planned in the second half of the year.

A detailed report on the H1 2020 exploration activities at the Ordubad contract area can be found at https://wp-angloasianmining-2020.s3.eu-west-2.amazonaws.com/media/2020/08/05145157/H1-2020-Exploration-Activities-Ordubad.pdf   and on the Company's website ( www.angloasianmining.com ).

Competent Person Statement

The information in the announcement that relates to exploration results, minerals resources and ore reserves is based on information compiled by Dr Stephen Westhead, who is a full-time employee of Anglo Asian Mining with the position of Director of Geology & Mining, who is a Fellow of The Geological Society of London, a Chartered Geologist, Fellow of the Society of Economic Geologists, Member of The Institute of Materials, Minerals and Mining and a Member of the Institute of Directors.

Stephen Westhead has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Stephen Westhead consents to the inclusion in the announcement of the matters based on his information in the form and context in which it appears.

Stephen Westhead has sufficient experience, relevant to the style of mineralisation and type of deposit under consideration and to the activity that he is undertaking, to qualify as a "competent person" as defined by the AIM rules. Stephen Westhead has reviewed the resources and reserves included in this announcement.

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

**ENDS**

For further information please visit www.angloasianmining.com or contact:

Reza Vaziri	Anglo Asian Mining plc	Tel: [phone]
Bill Morgan	Anglo Asian Mining plc	Tel: [phone]
Stephen Westhead	Anglo Asian Mining plc	Tel: [phone]
Ewan Leggat	SP Angel Corporate Finance LLP Nominated Adviser and Broker	Tel: [phone]
Soltan Tagiev	SP Angel Corporate Finance LLP Nominated Adviser and Broker	Tel + 44 (0) 20 3470 0470
Camilla Horsfall	Blytheweigh Financial	Tel: + 44(0) 20 7138 3224
Megan Ray	Blytheweigh Financial	Tel: + 44(0) 20 7138 3224

Notes:

Anglo Asian Mining plc (AIM:AAZ) is a gold, copper and silver producer in Central Asia with a broad portfolio of production and exploration assets in Azerbaijan. The Company has a 1,962 square kilometre portfolio, assembled from analysis of historic Soviet geological data and held under a Production Sharing Agreement modelled on the Azeri oil industry.

The Company's main operating location is the Gedabek contract area ("Gedabek") which is a 300 square kilometre area in the Lesser Caucasus mountains in western Azerbaijan. The Company developed Azerbaijan's first operating gold/copper/silver mine at Gedabek which commenced gold production in May 2009.  Mining at Gedabek was initially from its main open pit which is an open cast mine with a series of interconnected pits. The Company also operates the high grade Gadir underground mine which is co-located at the Gedabek site. In September 2017, production commenced at the Ugur open pit mine, a newly discovered gold ore deposit at Gedabek. The Company has a second underground mine, Gosha, which is 50 kilometres from Gedabek. Ore mined at Gosha is processed at Anglo Asian's Gedabek plant.

The Company produced 81,399 gold equivalent ounces ("GEOs") for the year ended 31 December 2019. Gedabek is a polymetallic ore deposit that has gold together with significant concentrations of copper in the main open pit mine, and an oxide gold-rich zone at Ugur. The Company therefore employs a series of flexible processing routes to optimise metal recoveries and efficiencies.  The Company produces gold doré through agitation and heap leaching operations, copper concentrate from its Sulphidisation, Acidification, Recycling, and Thickening (SART) plant and also a copper and precious metal concentrate from its flotation plant.

The Company has a production target for the year to 31 December 2020 of 65,000 ounces to 67,000 ounces of gold and 2,200 tonnes to 2,400 tonnes of copper. This total production target expressed as gold equivalent ounces ("GEOs") at budgeted prices is between 75,000 GEOs and 80,000 GEOS.

Anglo Asian is also actively seeking to exploit its first mover advantage in Azerbaijan to identify additional projects, as well as looking for properties in other jurisdictions in order to fulfil its expansion ambitions and become a mid-tier gold and copper metal production company. It has recently announced that it will enter into a joint venture with Conroy Gold and Natural resources PLC to explore and develop various gold properties in The Republic of Ireland and Northern Ireland.

 

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