Azerbaijan, Baku, May 11 / Trend A.Akhundov /
Anglo Asian Mining plc decided to construct an agitation leaching plant to improve gold recoveries at its flagship Gedabek gold/copper/silver mine ('Gedabek') in Azerbaijan with a view to commissioning in the second half of 2013, the company's statement said.
The plant, if commissioned, is expected to process high grade ore and additional resources that are not suitable for the current heap leaching processing operation, together with spent ore from the leach heaps to further improve total gold recoveries. Agitation leaching recoveries have been initially estimated at 85 percent for oxide material and 69 percent for sulphide material although the Company is carrying out further tests to see if these recoveries can be improved.
The new plant will be designed to treat 100 tonnes of ore per hour.
The expected cost of designing, building and commissioning the new plant and its infrastructure is approximately $52 million and the Company is currently in discussions with local and international banks with regards to securing finance for this capital investment.
The Board of Anglo Asian has so far committed $4 million to purchasing the first equipment for the proposed plant.
In 2011, the Company significantly reduced its debt and built its cash position. At 31 December 2011 its net debt, being interest-bearing loans and borrowings less cash and cash equivalents, stood at $3.2 million (2010: $25.6 million) and cash in the bank stood at $9.8 million.
According to preliminary results of the revaluation, which is carried out according to the classification of the Joint Ore Reserves Committee, the measured gold reserves at this deposit are 738,958 oz. (nearly 21 tons), copper - 57,069 tons and silver - 5,927,487 oz. (168 tons).
Indicated gold reserves are 315,424 oz. (nearly 9 tons), copper - 24,696 tons and silver - 2,681,064 oz. (76 tons).
Measured and indicated gold reserves are 1,054,382 oz. (29.89 tons), copper - 81,765 tons and silver - 8,608,551 oz. (244.05 tons). It's necessary to process 37.11 million tons of ore for their production.
Inferred gold reserves are estimated at 222,040 oz. (6.29 tons), copper - 13,125 tons and silver - 1,697,102 oz. (48.11 tons).
Taking into account the measured, indicated and inferred category, after processing 48,138,979 tons the results are: 1,276,422 oz. of gold (a 61 per cent increase); 94,890 tons of copper (a 93 per cent increase); and 10,305,653 oz. of silver (a 36 per cent increase) can be produced.
"This, in tandem with the latest drilling results from 2012 and high expectations from the forthcoming reserve update due to be published in Q2 2012, has given the Board the confidence in future gold production at Gedabek to justify investment in a new agitation leaching plant," the statement said.
The Company is submitting the final paperwork to the Government of Azerbaijan to gain final permission for the construction and commissioning of the agitation plant.
Minister of Ecology and Natural Resources of Azerbaijan Huseyngulu Baghirov told Trend earlier plans of Anglo Asian Mining plc for the construction of a new plant in the Gedabek gold and copper mine are a response to the expected increase in reserves
The minister said it is more profitable in such small country as Azerbaijan, to build one plant and transport there the ore from all the gold deposits than to build a plant under each of them.
The Anglo Asian Mining Company has the rights to develop six deposits in the south-west of Azerbaijan - Gedabek, Ordubad, Gosha Bulag, Gyzyl Bulag, Vezhnali and Soyutlu based on a PSA type agreement signed in August 1997 with Azerbaijani government. Under the contract, production of about 400 tons of gold, 2500 tons of silver and 1.5 million tons of copper is planned at the deposit.
Gold produced at the deposits is sent for refinement to Switzerland. Bullions are brought to Azerbaijan and stored in the government's vaults. The first gold and silver was produced at the Gedabek deposit in May 2009.