BAKU

Azerbaijan’s leading gold mining company, Anglo Asian Mining Plc, extended its contract with the government for five years for Gedabek mine, the company said.

Anglo Asian Mining produces gold at Gedabek and other mines in Azerbaijan in a joint venture with the state in which the London-listed company holds a 51-percent stake. Its previous contract was due to expire in March 2022.

The company said that it was in negotiations with the government to obtain an extension of the territory of its existing contract areas and for new contract areas in Azerbaijan.

“I am very pleased to announce that the company has obtained the first of the five-year extensions of the Production Sharing Agreement for the Gedabek contract area, especially as we continue with our exploration programme which has already identified a number of new mineral occurrences including Zafer and Avshancli,” Reza Vaziri, the company CEO, said in a statement.

“This extension has been ratified by the government of Azerbaijan during ongoing negotiations for the company to increase its land under concession in Azerbaijan both through enlargement of its existing contract areas and the licensing of new areas.”

Last week Anglo Asian Mining reported a decline in gold production to 11,907 ounces in the first quarter of 2021 from 15,867 ounces in the same period last year.

The company said copper production increased in the first quarter by 14 percent year-on-year to 638 tonnes from 559 tonnes in January-March 2020. Silver production rose to 35,365 ounces from 34,642 ounces.

According to the company website, the total production of gold-equivalent ounces (GEO), which includes other metals, declined to 15,810 GEO from 18,219 GEO.

Anglo Asian said gold bullion sales totalled 5,635 ounces at an average price of $1,697 per ounce.  In January-March 2020, 11,236 ounces were sold at an average price of $1,577 per ounce.

The company forecast its gold output this year in a range of 48,000-54,000 ounces, down from 56,864 ounces produced last year.

“Lower gold production forecast due to mining only from the company’s existing Gedabek and Gadir mines in 2021, with no contribution from Ugur, which has now been depleted,” the company said.

The forecast for copper production stood at 2,500-2,800 tonnes. Copper output in 2020 was 2,591.

Anglo Asian projects that total metal production in 2021 will be in a range of 64,000-72,000 GEOs. Last year’s total output was 67,249 GEOs.

Gold and silver mining in Azerbaijan is carried out by two companies – Anglo Asian Mining and AzerGold CJSC, established in 2015.

According to the State Statistics Committee, total gold production declined to 829.5 kg in January-March 2021, 12.5 percent less than in the same period last year. Silver production fell 1.2 percent to 1,208 kg.