Azerbaijani gold producer began new drilling programme at Gedabey deposit

Business Materials 24 May 2012 16:00 (UTC +04:00)

Azerbaijan, Baku, May 24 /Trend A.Akhundov/

Anglo-Asian Mining plc., a gold producer in Azerbaijan has launched a new drilling programme at the gold and copper Gedabey deposit, the company said.

"The reserves discovered in the course of the first and second phase of drilling to a depth of 3420 metres confirm the considerable potential for further development and increase the volume of reserves at this deposit. The company started a new programme of drilling to a depth of 24,567 feet," General Director Reza Vaziri said.

According to preliminary results of a revaluation, the estimated gold reserves at this deposit are 738,958 ounces (about 21 tons), copper - 57 069 tons and silver - 5,927,487 ounces (168 tons).

Proven reserves of gold are at a level of 315,424 ounces (about 9 tons), copper - 24 696 tons and silver - 2,681,064 ounces (76 tons).

The estimated proved reserves of gold, totalled 1054382 ounce (29.89 tons), copper - 81,765 tons and silver - 8,608,551 ounces (244.05 tons). It is necessary to process 37.11 million tons of ore for their production.

According to preliminary estimates, in addition there may be gold reserves to the sum of 222,040 ounces (6.29 tone), copper - 13 125 tons and silver - 1,697,102 ounces (48.11 tons) at the deposit

Taking into account the nominal and possible reserves of the deposit, some 1.276.422 ounces of gold (over 36 tons) can be produced after the processing of 48.14 million tons of ore), which exceeds previous estimates by 61 per cent, 94,890 tons of copper (up by 93 per cent) and 10.305.653 ounces of silver (over 292 tons) during the forecast growth by 36 per cent.

Evaluation of the deposit is held on the classification of The Joint Ore Reserves Committee (JORC) and will be completed in the second half of 2012.

The total volume of gold production at the field was reduced to 57,068 ounces (1.62 tonnes) in 2011 611 tons of copper, 46,940 ounces (1.33 tones) of silver. Last year the company sold 49,304 ounces of gold at an average price of $1573 per ounce.

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.