Last checked at 12 Apr 2010 07:00
Anglo Asian Mining plc / Ticker: AAZ / Index: AIM / Sector: Mining
12 April 2010
Anglo Asian Mining plc ('Anglo Asian' or 'the Company')
Gedabek Operations Update - 6,167 oz March Gold Production
Anglo Asian Mining plc, the AIM listed emerging gold producer, is pleased to provide an update on operations at its Gedabek gold/copper mine ('Gedabek') in Azerbaijan.
Overview
·; Record production for month ending 31 March 2010 at Gedabek of 6,167 oz Au
·; Total production to date from Gedabek 25,022 oz Au - exceeding production target for first full year of operation to 30 June 2010 of 25,000 oz Au
·; Second calendar year production target of 53,500 oz Au
Anglo Asian CEO Reza Vaziri said, "Naturally we are delighted to report that gold production at Gedabek continues to increase and we are confident that this upward trend will be maintained as processing efficiencies further improve. We are particularly pleased to report that we have already exceeded our target production of 25,000 ounces of gold for the mine's first year of operation and anticipate that this figure will more than double for the calendar year ending 31 December 2010."
In the month ended 31 March 2010, the Company produced 6,167 ounces ('oz') of gold ('Au') at Gedabek. This brings total production to date from Gedabek to 25,022 oz Au, which is ahead of the Company's production target for the first full year of operation to 30 June 2010 of 25,000 oz Au. Going forward, Anglo Asian will report quarterly operation updates, with the first update commencing for the quarter ending 30 June 2010. Additionally, the Company is aligning its production forecasts with its calendar year reporting. In line with this, its production forecast for the year ending 31 December 2010 is 53,500 oz Au.
The following summary table of gold production and prices highlights the month-on-month increase in gold production at Gedabek.
| Month | Gold Produced (Including Govt. of Azerbaijan's share) (oz) | Weighted Average Gold Sale Price (US$) |
| July 2009 | 802 | 944 |
| August 2009 | 751 | 951 |
| September 2009 | 2,192 | 997 |
| October 2009 | 2,208 | 1,037 |
| November 2009 | 2,549 | 1,129 |
| December 2009 | 2,863 | 1,105 |
| January 2010 | 3,483 | 1,106 |
| February 2010 | 4,007 | 1,090 |
| March 2010 | 6,167 | 1,111 |
Azerbaijan is now entering its rainy season - this is the first time that the mine has operated during this season. Whilst preparations have been undertaken to address potential problems, the Board is aware that it could temporarily hamper operations at the mine.
It should also be noted that under the Production Sharing Agreement, the Government of Azerbaijan receives 12.75% of gold produced until Anglo Asian has recovered its capital, operating and financing costs in full at which point the Government of Azerbaijan will then be entitled to a 51% share of profits.
In terms of processing, for the month ended 30 March 2010, the Company transferred 66,000 tonnes of dry ore onto the leach pad with an average gold content of 4.68 g/t. The Company expects to ramp this up to a target of 75,000 tonnes of dry ore per month.
As noted in our last operations update on 8 March 2010, the installation of new equipment has impacted positively on the plant's performance and production figures. In line with this, the new stacker system, which was purchased by the Company in February 2010, is due to be installed and operational in May 2010. This will help maintain consistent levels of dry ore being transferred to the leach pad.
Additionally, Anglo Asian has rescheduled the repayment of the outstanding $998,663 loan provided to the Company by CEO Reza Vaziri on 7 August 2009. It has been agreed that this loan should be paid back in one instalment on 30 November 2010. Under the terms of the original loan agreement, repayment was due to be made from 20% of net gold sales with a final repayment date of 7 February 2010. The loan carries an all inclusive annual interest rate of 8 per cent. per annum. Interest accrued to 30 June 2010 will be paid on 1 July 2010. Thereafter, interest will be paid quarterly or on repayment of the loan if earlier.
The Board and management continue to monitor the cash and operations carefully, but are pleased with the continuing improvements in production, cash flow and working capital which have succeeded in putting the Company on a firmer financial footing.
**ENDS**
For further information please visit www.aamining.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 |
| John Harrison | Numis Securities Limited, as Nominated Adviser | Tel: +44 (0) 20 7260 1000 |
| James Black | Numis Securities Limited, as Corporate Broker | Tel: +44 (0) 20 7260 1000 |
| Hugo de Salis | St Brides Media & Finance Ltd | Tel: +44 (0) 20 7236 1177 |
| Felicity Edwards | St Brides Media & Finance Ltd | Tel: +44 (0) 20 7236 1177 |
Notes:
Anglo Asian Mining plc (AIM:AAZ) is an emerging 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.
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.