Anglo Asian Regulatory News (AAZ)

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

12 February 2018

Anglo Asian Mining plc

$15 million syndicated two-year term 7 per cent. loan facility

Refinancing of the majority of existing debts at favourable interest rates releasing $8.4 million of capital to accelerate 2018 expansion and optimisation plans

Anglo Asian Mining plc ("Anglo Asian" or the "Company"), the AIM listed gold, copper and silver producer focused in Azerbaijan, is pleased to announce that a subsidiary of the Group, Azerbaijan International Mining Company Limited, has entered into a syndicated, two-year term loan facility with Pasha Bank OJSC Azerbaijan ("Pasha Bank") as arranger for up to $15 million at a 7 per cent. fixed interest rate per annum to refinance the majority of its existing loans (the "Facility"). The Facility will immediately improve the Group's financial performance in addition to providing operational flexibility.

Note that all references to "$" are to United States dollars.

Overview

· Two-year term loan facility for up to $15 million at 7 per cent. per annum fixed interest rate

· The Facility is unsecured and there are no financial covenants

· A total of $13.5 million of the Facility will be utilised to repay existing loans to Amsterdam Trade Bank N. V., Gazprombank (Switzerland) Ltd., Reza Vaziri (Anglo Asian CEO) and Yapi Credit Bank

· Following the refinancing, debt principal repayment in 2018 will be reduced to $5.1 million - releasing capital of $8.4 million to support expansion and optimisation initiatives at the Gedabek gold, copper and silver project ("Gedabek")

· The Facility will save approximately $0.1 million in interest in 2018

· Interest rate on loans totalling $2.1 million with the International Bank of Azerbaijan (which will not be refinanced) reduced from 12 per cent. to 7 per cent.

Anglo Asian CEO Reza Vaziri commented, "This comprehensive refinancing package will replace the majority of our existing debt and have a two-fold positive impact for Anglo Asian. Firstly, this will enhance our overall financial performance by lowering the cost of our debt through the reduction of interest payments. It will also enable the redeployment of capital otherwise earmarked for principal repayments in 2018 to accelerate our exploration and optimisation plans, which should further improve our long-term production at our Gedabek project.

"I would also like to note that the Facility is unsecured and there are no financial covenants which demonstrate the confidence that Pasha Bank and others have in our business. This is to our knowledge the first time a syndicated loan has been arranged in Azerbaijan which again confirms the Company as a first mover in the country."

Details

The Facility has the following major terms:

· Up to $15 million, two-year term loan with eight equal quarterly repayments of principal commencing three months from drawdown

· Interest rate of 7 per cent. annum fixed with monthly repayment of interest

· The Facility is unsecured and there are no financial covenants

· Total arrangement fee of 0.25 per cent. of amount borrowed

· Early repayment is permitted

A total of $13.5 million of the Facility will be drawn-down to repay the following existing loans:

Prior to the refinancing, the entire amount of loans to be refinanced was repayable in 2018. Subsequent to the refinancing, principal repayments will now be only $5.1 million. This releases capital of $8.4 million in 2018 which the Company can use to develop its business. The refinancing facility will save estimated interest payments of $0.1 million in 2018.

The Company currently has loans totalling $2.1 million which carried interest at 12 per cent. from the International Bank of Azerbaijan ("IBA"). As part of this refinancing, IBA has also agreed to reduce the interest on its loans to 7 per cent.

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:

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 which is a 300 square kilometer area in the lower 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 recently 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 71,461 gold equivalent ounces ('GEOs') for the year ended 31 December 2017. Gedabek is a polymetallic project which demonstrates a high copper content at the main open pit mine, and an oxide gold-rich zone at Ugur. The Company therefore employs a series of flexible processing routes through which to optimise 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, which is processing tailings from the agitation leach plant. A second dedicated crusher line is also currently being installed for the flotation plant to enable it to operate independently of the agitation leaching plant.

Anglo Asian is also actively seeking 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.