Gold producer in Azerbaijan has no plans to increase credit debt

Economy Materials 23 November 2015 16:48 (UTC +04:00)

Baku, Azerbaijan, Nov.23

By Azad Hasanli - Trend:

Anglo-Asian Mining PLC (ААМ), gold producer in Azerbaijan has no plans to attract funds from banks to finance the work in several fields, the company's director general Reza Vaziri told Trend.

Based on the production sharing agreement signed with Azerbaijani government in August 1997, Anglo Asian Mining PLC has the right to develop six fields in south-west of Azerbaijan: 'Gadabay', 'Ordubad', 'Gosha Bulag', 'Gizil Bulag', 'Vejnali' and 'Soyutlu'.

"If additional funds are required [I assume that these funds will be needed] for Gosha, Gadir and Ordubad fields, we can increase the authorized capital of AAM," he added.

Vaziri pointed out that currently, the company's authorized capital nears $11 million.

The authorized capital of the Anglo-Asian Mining PLC is distributed among six shareholders: Reza Vaziri (29.1 percent), John Sununu (9.5 percent), Khosrow Zamani (1.1 percent), John Mongemius (0.3 percent), Richard Round (0.27 percent) and Limelight Industrial Developments (3 58 percent).

At the end of the third quarter of 2015, net foreign borrowings of the company amounted to $51 million, including $17.4 million taken from Azerbaijani banks - PASHA Bank, YapiKredi and the International Bank of Azerbaijan.

At the same time, Vaziri said that low prices for gold have led to a decrease in value of the shares of gold mining companies.

"Our company was no exception, but I hope that the new plant [for the production of copper and precious metals in the Gadabay district of the country] and the opening of an underground mine "Gadir" on the Gadabay field will lead to an increase in share prices of the AAM," he said.

As of November 20, 2015, the value of AAM shares on London Stock Exchange amounted to $5.12 per share, whereas at the end of November 2014, their value reached $8 per share.

The company produced 54,103 ounces of gold, 634 tons of copper and 10,916 ounces of silver in Jan.-Sept. 2015.

ААМ plans to produce 74,000-75,000 ounces of gold by late 2015.

AAM and Swiss Industrial Minerals SA signed an agreement in May 2014 on selling cooper concentrate produced at Gadabay field.

The contract signed for the period of three years envisages the purchase of copper concentrate by the Swiss company.

Industrial Minerals will purchase both dry and wet copper concentrate.

The gold produced at the fields is sent to Switzerland for purification. The ingots are delivered to Azerbaijan and stored in the government's account.