REG - Anglo Asian Mining - Q1 2024 Production and Operations Review

Anglo Asian MiningAnnouncement

17/04/2024 07:01

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RNS Number : 8729K  Anglo Asian Mining PLC  17 April 2024

 

17 April 2024

Anglo Asian Mining plc

Q1 2024 Production and Operations Review

 

Anglo Asian Mining plc ("Anglo Asian" or the "Company"), the AIM listed gold,
copper and silver producer focused in Azerbaijan, provides the following
production, sales and operational review for its Gedabek contract area
("Gedabek") in western Azerbaijan for the three months to 31 March 2024 ("Q1
2024", or the "Quarter").

 

Production was significantly reduced during the Quarter due to operations
remaining partially shut down as the Company awaits permission to raise its
tailings dam wall, which it expects to receive shortly. Gold production from
heap leaching and copper production from SART continued throughout the
Quarter.

 

Q1 2024 Production update

·    Total production of 2,548 gold equivalent ounces ("GEOs") (Q1 2023:
10,969 GEOs)

o Copper production of 54 tonnes (Q1 2023: 847 tonnes)

o Gold production of 2,252 ounces (Q1 2023: 6,741 ounces)

o Silver production of 6,410 ounces (Q1 2023: 22,566 ounces)

 

Q1 2024 Sales and cash update

·    Total gold bullion sales of 3,925 ounces at an average of $2,080 per
ounce (Q1 2023: 5,719 ounces at an average of $1,895 per ounce)

·    The Group has maintained a strong focus on cash and strict cost
control, with a net debt position of $10.9 million at 31 March 2024 (31
December 2023: $10.2 million)

·    Net cash outflow in Q1 2024 of only $0.7 million due to sale of
opening inventory along with strong cost control

·    Inventory valued at $2.0 million at 31 March 2024 (31 December 2023:
2,506 ounces of gold valued at $6.9 million and copper concentrate valued at
$0.2 million)

 

Outlook

·    The Group submitted all necessary documents by 14 March 2024 to the
Government of Azerbaijan to raise the tailings dam wall and is now awaiting
receipt of the permission

·    Receipt of the permission will enable the resumption of normalised
production at Gedabek and, at this stage, the Company will accordingly issue
guidance for the full year 2024

·    The Company continues to prioritise the progression of its
development portfolio with first production from the new Gilar mine now
planned for Q4 2024

Anglo Asian CEO Reza Vaziri commented:

"Amid what has been a challenging time for the Company, we have made important
operational progress and our portfolio of development assets is progressing in
line with our expectations. We await Government permission to raise our
tailings dam wall, a necessary step for resuming normal production levels and
our ability to issue production guidance for the year. We anticipate the
permit will be issued shortly and this will enable us to take advantage of the
current strong metal prices for the benefit of all our stakeholders".

 

Note that all references to "$" are to United States dollars.

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, which was incorporated into UK law by the European
Union (Withdrawal) Act 2018, until the release of this announcement.

 

For further information please contact:

 

 Anglo Asian Mining plc
 Reza Vaziri, Chief Executive Officer                           Tel: +994 12 596 3350
 Bill Morgan, Chief Financial Officer                           Tel: +994 502 910 400
 Stephen Westhead, Vice President                               Tel: +994 502 916 894

 SP Angel Corporate Finance LLP (Nominated Adviser and Broker)  Tel: +44 (0) 20 3470 0470

 Ewan Leggat

 Adam Cowl

 Hudson Sandler (Financial PR)                                  Tel: +44 0) 20 7796 4133

 Charlie Jack

 Harry Griffiths

Notes to editors

 

Anglo Asian Mining plc (AIM:AAZ) is a gold, copper and silver producer with a
high-quality portfolio of production and exploration assets in Azerbaijan.
The Company produced 31,821 gold equivalent ounces ("GEOs") for the year
ended 31 December 2023.

 

On 30 March 2023, the Company published its strategic plan for growth which
shows a clearly defined path for the Company to transition to a multi-asset,
mid-tier, copper and gold producer by 2028, by which time copper will be the
principal product of the Company, with forecast production of around 36,000
copper equivalent tonnes. It plans to achieve this growth by bringing into
production four new mines during the period 2024 to 2028 at Zafar, Gilar,
Xarxar and Garadag.

 

https://www.angloasianmining.com/ (https://www.angloasianmining.com/)

 

Q1 2024 Production overview

·    Gold production of 2,252 ounces (Q1 2023: 6,741 ounces):

o 2,245 ounces contained within gold doré

o 7 ounces from sulphidisation, acidification, recycling and thickening
("SART") processing

·    Copper production of 54 tonnes (Q1 2023: 847 tonnes) from SART
processing

·    Silver production totalled 6,410 ounces (Q1 2023: 22,566 ounces):

o 1,517 ounces contained within gold doré

o 4,893 ounces from SART processing

 

Q1 2024 Sales overview

·    Total gold bullion sales of 3,925 ounces at an average of $2,080 per
ounce (Q1 2023: 5,719 ounces at an average of $1,895 per ounce)

·    Total concentrate sales of 71 dry metric tonnes ("dmt") with a value
of $0.3 million (Q1 2023: 1,147 dmt with a value of $2.7 million)

·    800 ounces of gold bullion was sold for $2,006.32 per ounce under the
Group's hedging program on 31 January 2024 generating lower revenue of $27,000
compared to the closing spot price on the day

 

Q1 2024 Financials overview

·    Cash of $9.8 million ($10.5 million at 31 December 2023)

·    Debt unchanged at $20.7 million ($20.7 million at 31 December 2023)

·    Net debt of $10.9 million ($10.2 million at 31 December 2023)

·    Unsold gold doré and copper concentrate inventory of $2.0 million

 

The Company mined the following ore during FY 2023 and Q1 2024:

 

                12 months to             3 months to

                 31 December 2023        31 March 2024
 Mine           Ore mined   Average      Ore mined  Average

                            gold grade              gold grade
                (tonnes)    (g/t)        (tonnes)   (g/t)
 Open pit       1,180,695   0.38         186,122    0.81
 Gadir - u/g    109,320     1.64         50,964     2.18
 Gedabek - u/g  -           -            -          -
 Total          1,290,015   0.49         237,086    1.10

 

The Company processed the following amounts and grades of ore by leaching for
FY 2023 and Q1 2024:

 

 Quarter ended      Ore processed                                                       Gold grade of ore processed
                    Heap leach pad crushed ore  Heap leach pad ROM  Agitation leaching  Heap leach pad crushed ore  Heap leach pad ROM  Agitation leaching

                    (tonnes)                    ore                 plant*              (g/t)                       ore                 plant*

                                                (tonnes)            (tonnes)                                        (g/t)               (g/t)
 31 March 2023      94,518                      196,595             62,006              0.74                        0.49                1.3
 30 June 2023       56,522                      202,788             105,213             0.75                        0.46                1.4
 30 September 2023  25,690                      34,621              -                   0.83                        0.45                -
 31 December 2023   -                           -                   -                   -                           -                   -
 FY 2023            176,730                     434,004             167,219             0.76                        0.48                1.4
 31 March 2024      120,528                     -                   -                   0.68                        -                   -

 

* includes previously heap leached ore.

 

The Company processed the following amounts of ore and contained metal by
flotation for FY 2023 and Q1 2024:

 Quarter ended      Ore processed  Gold content  Silver content  Copper content
                    (tonnes)       (ounces)      (ounces)        (tonnes)
 31 March 2023      192,516        1,487         19,787          1,133
 30 June 2023       190,593        1,033         10,380          1,191
 30 September 2023  62,369         478           4,358           363
 31 December 2023   -              -             -               -
 FY 2023            445,478        2,998         34,525          2,687
 31 March 2024      -              -             -               -

 

 

The following table summarises gold doré production and sales at Gedabek for
FY 2023 and Q1 2024:

 

 Quarter ended      Gold produced*  Silver      Gold sales**  Gold Sales price

                                    produced*

                    (ounces)        (ounces)    (ounces)      ($/ounce)
 31 March 2023      5,965           2,841       5,719         1,895
 30 June 2023       7,375           3,593       4,787         1,992
 30 September 2023  4,001           1,488       2,900         1,949
 31 December 2023   2,975           1,610       2,416         2,004
 FY 2023            20,316          9,532       15,822        1,951
 31 March 2024      2,245           1,517       3,925         2,080

Note

* including Government of Azerbaijan's share

** excluding Government of Azerbaijan's share

 

The gold and silver production from agitation and heap leaching for FY 2023
and Q1 2024 is as follows:

 

 Quarter        Gold                             Silver

 ended
                Agitation  Heap       Total      Agitation  Heap       Total

                leaching   leaching              leaching   leaching

                (ounces)   (ounces)   (ounces)   (ounces)   (ounces)   (ounces)
 31 March 2023  2,105      3,860      5,965      1,077      1,764      2,841
 30 June 2023   3,463      3,912      7,375      1,735      1,858      3,593
 30 Sept 2023   -          4,001      4,001      -          1,488      1,488
 31 Dec 2023    -          2,975      2,975      -          1,610      1,610
 FY 2023        5,568      14,748     20,316     2,812      6,720      9,532
 31 March 2024  -          2,245      2,245      -          1,517      1,517

 

The following table summarises copper concentrate production from both the
Company's SART and flotation plants at Gedabek for FY 2023 and Q1 2024:

 

                             Concentrate  Copper    Gold      Silver
                             production*  content*  content*  content*
                             (dmt)        (tonnes)  (ounces)  (ounces)
 2023
 Quarter ended 31 March
 SART processing             364          191       26        8,750
 Flotation                   4,544        665       762       11,095
 Total                       4,908        856       788       19,845
 Quarter ended 30 June
 SART processing             272          145       16        10,316
 Flotation                   5,613        869       479       8,101
 Total                       5,885        1,014     495       18,417
 Quarter ended 30 September
 SART processing             85           43        4         2,194
 Flotation                   1,316        207       151       1,974
 Total                       1,401        250       155       4,168
 Quarter ended 31 December
 SART processing             29           18        4         1,264
 Flotation                   -            -         -         -
 Total                       29           18        4         1,264
 2024
 Quarter ended 31 March
 SART processing             89           54        7         4,893
 Flotation                   0            -         -         -
 Total                       89           54        7         4,893

Note

* including Government of Azerbaijan's share.

Certain amounts for SART and flotation production may differ to those
previously disclosed due to final reconciliation of production.

 

The following table summarises total copper concentrate production and sales
for FY 2023 and Q1 2024. Note that sales of concentrates are initially
recorded at provisional amounts until agreement of final assay:

 

                    Concentrate  Copper    Gold      Silver    Concentrate

                                                                            Concentrate
                    production*  content*  content*  content*  sales**      sales**
                    (dmt)        (tonnes)  (ounces)  (ounces)  (dmt)        ($000)
 Quarter ended
 31 March 2023      4,908        856       788       19,845    1,147        2,743
 30 June 2023       5,885        1,014     495       18,417    5,501        7,678
 30 September 2023  1,401        250       155       4,168     2,358        3,066
 31 December 2023   29           18        4         1,264     2,186        2,306
 FY 2023            12,223       2,138     1,442     43,694    11,192       15,793
 31 March 2024      89           54        7         4, 893    71           295

* including Government of Azerbaijan's share

** excludes Government of Azerbaijan's share

 

Q1 2024 Financial review

The Company's net debt increased from $10.2 million at 31 December 2023 to
$10.9 million at 31 March 2024 as follows:

 

                      $million  $million
 31 December 2023               (10.2)
 Revenue              8.6
 VAT refund           1.3
 Interest income      0.2
 Operating costs      (9.6)
 Capital expenditure  (0.7)
 Debt servicing       (0.5)
 Outflow in Q1 2024             (0.7)
 31 March 2024                  (10.9)

 

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