Q1 2015 Gedabek Update

RNS Number : 0823K

Anglo Asian Mining PLC

14 April 2015

 



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

14 April 2015

Anglo Asian Mining plc

Q1 2015 Operations Update

  Gedabek gold, copper and silver mine, 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 from its Gedabek gold, copper and silver mine ("Gedabek") in western Azerbaijan for the three months to 31 March 2015 ("Q1 2015").

Production overview

·    Gold production for Q1 2015 increased to 17,193 ounces with 11,222 ounces from the agitation leaching plant, 5,963 ounces from heap leach operations and 8 ounces from SART processing (Q4 2014: total 17,053 ounces)

·    Gold production was 52 per cent. higher than the same period of the previous year (Q1 2014)

·    Copper production for Q1 2015 totalled 182 tonnes from SART processing (Q4 2014: 205 tonnes)

·    Silver production for Q1 2015 totalled 1,950 ounces with 388 ounces from the agitation leaching plant, 208 ounces from heap leaching operations and 1,354 ounces from SART processing (Q4 2014: total 3,749 ounces)

·    Gold production target for the year to 31 December 2015 ("FY 2015") is between 70,000 ounces and 75,000 ounces (including approximately 5,000 ounces of production from the small scale flotation plant targeted to be commissioned in Q3 2015)

Sales

·    Q1 2015 gold sales of 17,206 ounces at an average of US$1,214 per ounce

·    Q1 2015 copper concentrate shipments to the customer totalled 272 dry metric tonnes ("dmt"), containing 162 tonnes of copper

Company financials

·    Net debt, being interest-bearing loans and borrowings less cash and cash equivalents, totals US$50.7 million at 31 March 2015 (US$52.4 million at 31 December 2014)

Anglo Asian CEO Reza Vaziri said, "We are delighted to report exceptional gold and copper production for Q1 2015, especially as the first three months of the year have historically seen production capabilities and ore throughput constrained at Gedabek due to the seasonal harsh winter conditions.  This is a highly credible performance for the quarter and shows that the various initiatives taken during 2014 to improve production performance are now starting to show positive results.

"In line with this, we are making good progress on the building of our small scale flotation plant and the necessary modifications to enable it to process the tailings of the agitated leach plant.  We expect the plant to be commissioned in Q3 2015.

"With this in mind, our production target for 2015 of between 70,000 and 75,000 ounces of gold represents a significant increase of around 16 to 24 per cent. compared to the FY 2014 production of 60,285 ounces.  I look forward to providing further updates in due course as we continue to improve our production performance in order to deliver the utmost value for shareholders."

Full details

Gedabek is a polymetallic deposit from which Anglo Asian produces gold, copper and silver from its open pit mining operation. The Company also processes ore from its Gosha deposit, approximately 50 kilometres away from Gedabek. Three different processing methods, agitation leaching, heap leaching and Sulphidisation, Acidification, Recycling, and Thickening ('SART') are used to produce precious metal and copper.

During Q1 2015, the Company produced 17,193 ounces of gold at Gedabek; 11,222 ounces from the agitation leaching plant, 5,963 ounces from heap leach operations and 8 ounces from SART processing. Anglo Asian completed gold sales of 17,206 ounces of gold at an average of US$1,214 per ounce for Q1 2015.

The Company's SART plant has been performing well producing copper concentrate and for Q1 2015 copper production totalled 182 dmt. Anglo Asian has a strategic three year sales partnership in place with Industrial Minerals (SA) which commenced in May 2014 for the sale of Anglo Asian copper concentrates.  Sales of copper concentrate for Q1 2015 totalled 272 dmt.

Silver production for Q1 2015 totalled 1,950 ounces; with 388 ounces from the agitation leaching plant, 208 ounces from heap leaching operations and 1,354 ounces from SART.

The following summary table of gold production and prices outlines quarter-on-quarter gold production at Gedabek for Q1 2015 and the four quarters of the previous year.

Quarter ended	Gold Produced* (oz)	Gold Sales** (oz)	Gold Sales  Price (US$)	Copper   Produced (dmt)	Copper Concentrate Sales (dmt)	Silver Produced (oz)
31 Mar 2014	11,318	10,403	1,302	141	152	13,139
30 Jun 2014	15,736	13,142	1,291	228	523	8,785
30 Sept 2014	16,178	13,798	1,281	210	250	5,504
31 Dec 2014	17,053	13,272	1,201	205	391	3,749
Total FY 2014	60,285	50,615	1,267	784	1,316	31,177
31 Mar 2015	17,193	17,206	1,214	182	272	1,950

* including Government of Azerbaijan's share

** excludes Government of Azerbaijan's share

As previously reported, low grade ore (less than 1.5 grammes per tonne of gold) is being treated by heap leaching, whilst higher grade ore (more than 1.5 grammes per tonne of gold) is being processed through the agitation leaching plant.

During Q1 2015, Anglo Asian stacked 92,586 tonnes of dry crushed ore on to heap leach pads with an average gold content of 1.47 grammes per tonne. The Company also heap leached uncrushed (Run of Mine - "ROM") ore. During Q1 2015, Anglo Asian stacked 135,887 tonnes of ROM ore on to heap leach pads with an average gold content of 1.00 grammes per tonne.

During Q1 2015, the Company processed 136,717 tonnes of ore with an average gold content of 3.61 grammes per tonne through the agitation leaching plant.

There was a 71 per cent. gold recovery in agitation leaching for Q1 2015, the same as the previous two quarters. Gold doré is produced from both heap and agitated leach intermediate solutions, which are combined for final processing and also recirculated around the plant, heap leach pads and tailings dam. Heap leaching is also a long term process and recoveries are therefore only estimates calculated from available metallurgical statistics.

As recently announced on 9 March 2015, the construction of a small scale flotation plant is proceeding to plan. As also announced, the Company is proceeding with the necessary design modifications to enable the plant to treat the tailings from the agitation leach plant.  

The Company had net debt at 31 March 2015 of US$50.7 million, a reduction of US$1.7 million since 31 December 2014. The net debt at 31 March 2015 was as follows:                     

	US$m
Amsterdam Trade Bank -  Agitation plant loan	34.5
International Bank of Azerbaijan -  loan	13.4
Atlas Copco equipment finance loan YapiKredit Pasha Bank	0.8   0.7   1.8
Total Loans	51.2
Cash on hand and at bank	(0.5)
Net debt	50.7

**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]
Ewan Leggat	SP Angel Corporate Finance LLP Nominated Adviser and Broker	Tel: [phone]
Stuart Gledhill	SP Angel Corporate Finance LLP	Tel + 44 (0) 20 3470 0470
Felicity Winkles	St Brides Partners Ltd	Tel: [phone]
Lottie Brocklehurst	St Brides Partners Ltd	Tel: [phone]

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 prospective exploration portfolio, assembled from analysis of historic Soviet geological data and held under a Production Sharing Agreement modelled on the Azeri oil industry.

The Company developed Azerbaijan's first operating gold/copper/silver mine, Gedabek, which commenced gold production in May 2009.  Gold production for the year ended 31 December 2014 from Gedabek totalled 60,285 ounces and 784 tonnes of copper. The Company is also developing a second resource area, Gosha, which is 50 kilometres from Gedabek, and the ore produced at Gosha is processed at Anglo Asian's Gedabek plant. The Company's production target for full year 2015 is between 70,000 ounces and 75,000 ounces of gold. Gedabek is a polymetallic deposit and its ore has a high copper content, and as a result the Company produces copper concentrate from its Sulphidisation, Acidification, Recycling, and Thickening (SART) plant. Anglo Asian is also constructing a small scale, low capital expenditure flotation plant to produce a copper and precious metal concentrate. This will initially process ore from its existing stockpiles of sulphide ore with a high copper content.

Anglo Asian is also actively looking to exploit its first mover advantage in Azerbaijan to identify additional projects, as well as looking for other properties in order to fulfil its expansion ambitions and become a mid-tier gold and copper metal production company.

 

END

 

 

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