Another gold producer starts ops in Azerbaijan
By Nigar Orujova
Azerbaijan International Mineral Resources Operating Co. Ltd (AIMROC), the second gold producer in the resource-rich country, has begun production, an executive of the company said this week.
"The first bar of gold from Chovdar mine in the northwest of Azerbaijan was produced in early October," said Mustafa Mammadov, the company's head of Sustainable Development and Strategic Planning. "The commissioning work is underway. We will achieve full production capacity in a month."
According to Mammadov, the deposit holds about 40 tons of gold, and AIMROC plans to extract it during 8-10 years. "But there is no clear projection on annual production rates, as this depends on many factors," he added.
Mammadov also noted that testing of the gold heap leaching plant will be finalized by the end of the year.
"The plant will operate at full capacity by early 2013. Our plant has enough capacity to handle all the ore that we have today and that could potentially be [extracted] in the future - 3,000 tons of ore per day," Mammadov said.
According to Mammadov, the company will extract lead, copper, silver, and other metals from this field in addition to gold.
"The date of sending the first gold bar to the Central Bank of Azerbaijan is yet to be set. We should also define the place where gold refining will be done," Mammadov said.
Mammadov also said AIMROC will launch preparation of a feasibility study of the projects on developing two additional gold mines by late 2012.
"We will begin this year developing a feasibility study of the projects on developing Kehnamadan and Goydag deposits, where exploration operations are underway," Mammadov said. He added that at this point, it is too early to speak about production at these fields.
The Azerbaijani government and AIMROC consortium, which includes Londex Resources SA, Willy & Meyris SA, Fargate Mining Corporation, Globex International LLP, and Mitsui Mineral Development Engineering Co. Ltd., signed an agreement on December 30, 2006.
AIMROC extracted first gold from Chovdar field in fall 2012.
The Azerbaijani government will receive 30 percent of AIMROC's income from development projects at Garadagh, Chovdar, Goydag and Dagkesaman ore-bearing areas, Kohnemadan area and Kurekchay river basin. The contract envisions exploration and development of these fields.
According to the draft state budget for 2013 and the subsequent three years, submitted to the Azerbaijani parliament, Azerbaijan forecasts one percent annual increase in gold production until 2017.
Gold production is expected to reach about 1,792 kilograms in 2012, 1,810 kilograms in 2013, 1,828 kilograms in 2014, about 1,847 kilograms in 2015, and 1,865 kilograms in 2016.
The first gold and silver were mined in Gadabay mine in northwestern Azerbaijan in May 2009. Copper concentrate production began in 2010.
The first Azerbaijani gold producer, Anglo-Asian Mining plc, produced 35,685 ounces of gold at Gedabey gold and copper mine over the three quarters of 2012.
According to projections, silver and copper ore production is expected to increase in the future.
Silver production is expected to reach 1,240 kilograms in 2013, 1,252 kilograms in 2014, 1,265 kilograms in 2015, and 1,278 kilograms in 2016.
Anglo-Asian Mining produced 15,342 ounces of silver as of September 2012, with 3,168 ounces produced in the third quarter.
Mining of copper ores and concentrates will amount to 885.7 tons in 2013, 1,062 tons in 2014, some 1,275 tons in 2015, and 2,362 tons in 2016.
The Anglo Asian Mining company has the rights to develop six deposits in the south-west of Azerbaijan -- Gedabey, Ordubad, Gosha Bulag, Gyzyl Bulag, Vezhnali and Soyutlu, based on a PSA signed in August 1997 with Azerbaijan's government.
Under the agreement, it is planned to mine about 400 tons of gold, 2,500 tons of silver and 1.5 million tons of cooper.
The gold and silver produced there are sent to Switzerland for refining, and gold bars are delivered to the country and preserved by the government.