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, sales and operations review for its Gedabek gold, copper and silver mining and production contract area ('Gedabek') in western Azerbaijan for the three months to 30 June 2020 ('Q2 2020') and six months to 30 June 2020 ('H1 2020').
Anglo Asian CEO Reza Vaziri commented: 'The first half of the year has presented a number of challenges for the Company. However, it is pleasing to note that we have maintained gold shipments and increased our net cash position by $3.2 million during the quarter and by $8.0 million since the start of the year.
'The COVID-19 pandemic has had some effect on our operations at Gedabek including our second quarter production. Our workforce remains highly committed but the COVID-19 restrictions in Azerbaijan have resulted in staff working without rotation continuously at Gedabek since March with reduced social interaction. The constraints placed on obtaining supplies, maintaining equipment and shipping gold have also required extra effort. Whilst we are largely overcoming the issues, Gedabek is not yet operating as efficiently as prior to the pandemic.
'The lower gold production than the previous quarter was also a result of lower than anticipated gold grades. A number of measures are currently on-going to ensure we meet our production guidance for the year. These include constructing a new decline to allow underground mining of the high-grade ore below the Gedabek open pit and the reprocessing by agitation leaching of previously heap leached ore with residual high gold grades.
'The gold price continues to perform favourably and, in Q2 2020, we received an increase of approximately $400 per ounce for gold bullion sales compared to the same period last year. With prices expected to remain at these levels, this bodes well for the future financial performance of the Company.
'I look forward to a more productive second half of the year as we remain on track to meet our FY 2020 production guidance of 75,000 GEOs to 80,000 GEOs and revenue guidance of over $100 million'
Measures to ensure FY 2020 Guidance is achieved
The Company is carrying out several measures to ensure the FY 2020 Guidance is achieved: A new portal has been opened and a new decline is being constructed of approximately 500 metres to access the high-grade extension of the ore body under the main open pit. It is anticipated the decline will be completed around the end of the current quarter depending on the hardness of rock encountered. It will join the tunnel currently being constructed from the Gadir underground mine to give the two egresses required to commence mining. It is anticipated underground mining of Gedabek ore will begin in Q4 2020.
Around 100,000 tonnes of previously heap leached ore containing gold grades greater than two grammes per tonne has been identified. This ore, which was processed in the early years of the Company's life, will be recovered from the old heaps and retreated by agitation leaching in H2 2020. The final lift of the tailings dam wall is almost complete, which is releasing earth-moving equipment that will be transferred to this task.
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.
Contact:
Reza Vaziri
Tel: +994 12 596 3350
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 dore 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 other properties elsewhere in order to fulfil its expansion ambitions and become a mid-tier gold and copper metal production company.
ANGLO ASIAN MINING PLC 
