Last checked at 7 Jul 2010 07:00
Anglo Asian Mining plc / Ticker: AAZ / Index: AIM / Sector: Mining
7 July 2010
Anglo Asian Mining plc ('Anglo Asian' or 'the Company')
Quarterly Operations Update
Anglo Asian Mining plc, the AIM listed emerging gold producer, is pleased to provide an update for the quarter ended 30 June 2010 on operations at its flagship Gedabek gold/copper mine ('Gedabek') in Azerbaijan.
Overview
·; Record quarterly gold production figures of 14,836 ounces at Gedabek
·; Total production for the first year of operation was 39,858 oz gold ('Au') exceeding Company's 25,000 oz Au forecast
·; New equipment installed at Gedabek to increase forecast production to 53,500 oz Au for the year to 31 December 2010, in line with Company production targets
·; 189,000 tonnes of gold dry ore on the leach pad with an average gold content of approximately 3.8 g/t
·; Commencement of SART process to improve recovery of copper/silver from leach pad - 145 dry tonnes copper concentrate produced since February 2010
·; Resource expansion at Gedabek anticipated in July - early results indicate potential upgrades of at least 50%
Anglo Asian CEO Reza Vaziri said, "We are delighted to announce these record quarterly production figures, which highlight Gedabek's production success as it continues to gain momentum. In line with continued production efficiencies we are confident we will hit our production target for the financial calendar year to 31 December 2010 of 53,500 oz Au.
"Furthermore, we are expecting the final JORC compliant resource results of Phase I of the Realistic Mineral Resources Model Report at Gedabek at the end of July. This could be a transformational stage in Gedabek's development as initial results indicate upgrades for the measured, indicated and inferred gold, copper and silver metal contents of at least 50%, which will improve the economic potential and production capabilities of the mine significantly."
During the quarter ended 30 June 2010, the Company produced 14,836 ounces ('oz') Au. This brings total production for the first 12 months of operation to 39,858 oz Au, which exceeds the Company's forecast of 25,000 oz Au for the first full year of operation to 30 June 2010.
The following summary table of gold production and prices highlights the quarter-on-quarter increase in gold production at Gedabek. With improvements in terms of production efficiencies at the processing plant continuing, the Board is confident that it will reach its production target to 31 December 2010 of 53,500 oz Au.
| Quarter ended | Gold Produced (including Govt. of Azerbaijan's share) (oz) | Weighted Average Gold Sale Price (US$) |
| 30 Sept 2009 | 3,745 | 980 |
| 31 Dec 2009 | 7,620 | 1,090 |
| 31 Mar 2010 | 13,657 | 1,102 |
| 30 June 2010 | 14,836 | 1,197 |
It should 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, during the quarter the Company transferred 189,000 tonnes of dry ore onto the leach pad with an average gold content of approximately 3.8 g/t. The Company expects to ramp this up to a target of 75,000 tonnes of dry ore per month giving a quarterly target of 225,000 tonnes of dry ore onto the leach pad.
As noted in previous operation updates on 12 April 2010 and 8 March 2010, Anglo Asian has implemented a number of initiatives including installing new equipment to improve production efficiencies at Gedabek. Our new stacker system, which we purchased in April 2010, is now fully operational and has improved the running times of the section which will help maintain consistent levels of dry ore being transferred to the leach pad.
In anticipation of problems caused by the wet season which runs from April to July each year, the Company has built bigger drainage channels around the leach pad and increased the surge capacity of its solution storage ponds. Anglo Asian has also installed an additional storage pond and a further storage pond is currently under construction. The storage ponds facilitate the overflow of solution from the BLS and PLS ponds.
At the Adsorption, Desorption, Recovery ('ADR') plant a new elution column has been installed, together with an extra bank of electrowinning cells to improve operational flexibility. These items will facilitate additional plant availability and improve process efficiencies.
In February 2010, the Company commenced the Sulphidisation, Acidification, Recycling, and Thickening ('SART') process to facilitate the recovery of the copper dissolved in the leaching solution. The copper is recovered in the form of a precipitated copper sulphide concentrate by-product, which also contains silver with commercial value. For the four months to 30 June 2010 the Company produced approximately 145 dry tonnes of copper concentrate with a 60% copper content and 4 kg/t of silver. The copper concentrate produced to date has an unusually high moisture content. Consequentially a new filtration system has been ordered and a drier unit is being investigated. The Company is in the process of evaluating options for the sale of its copper/silver concentrate.
**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.