Azerbaijan-focussed gold, copper and silver producer Anglo Asian Mining updated the market on its exploration and production optimisation strategy on Tuesday, together with a quarterly review from its Gedabek gold, copper and silver mine in western Azerbaijan for the three months to 31 March.
The AIM-traded firm said a strategic review was completed to optimise long term production at Gedabek, and extensive exploration and production optimisation was now planned for both the main open pit and Gadir underground mines in 2017.
It said Gedabek ore stockpiles were to be processed whilst exploration and production optimisation was ongoing during a temporary pause in mining ore.
Flotation treatment of ore prior to leaching was now underway to process ore stockpiles with high copper content and to improve the flexibility of processing operations, and ore mining was to commence from a new open pit at the recently discovered Ugur deposit in the fourth quarter.
It reported a conservative gold production target for Gedabek for the year to 31 December 2017 of between 52,000 ounces and 58,000 ounces - which included approximately 8,000 ounces to 10,000 ounces of production from the flotation plant and 8,000 to 10,000 ounces from the new Ugur open pit - reflecting the strategy of exploration and long-term production optimisation.
The copper production target for 2017 was between 2,000 tonnes and 2,400 tonnes, comprising between 600 tonnes to 700 tonnes from SART processing and between 1,400 tonnes to 1,700 tonnes from flotation.
Total production targets for the year, expressed as gold equivalent ounces, was between 64,000 ounces and 72,000 ounces compared to 2016 actual total production of 72,304 gold equivalent ounces.
On the production front, Anglo Asian said gold production for Q1 2017 totalled 11,078 ounces.
That comprised of 9,258 ounces contained within gold doré, five ounces from SART processing and 1,815 ounces from flotation, but it was down from a fourth quarter total of 15,483 ounces.
Copper production for the first quarter totalled 606 tonnes, with 210 tonnes from SART processing and 396 tonnes from flotation, and the total improving from 578 tonnes quarter-on-quarter.
Silver production for the period totalled 39,369 ounces - 2,447 ounces contained was within gold doré, 5,523 ounces was from SART processing and 31,399 ounces was from flotation - compared to a Q4 2016 total of 50,216 ounces.
Gold bullion sales in the first quarter totalled 8,283 ounces at an average of $1,220 per ounce, compared to 12,995 ounces at an average of $1,227 per ounce in the previous quarter.
Copper concentrate shipments to the customer totalled 2,230 dry metric tonnes in the same period, with a sales value of $4.4m - excluding the Government of Azerbaijan production share - compared to 2,147 dmt with a sales value of $3.9m in the last quarter of 2016.
Looking at the books, net debt - being interest-bearing loans and borrowings, less cash and cash equivalents - totalled $33.1m at 31 March, down from $35.1m at 31 December.
"Whilst we undertake [the] exploration and optimisation throughout the remainder of 2017, we will understandably see a reduction from the level of gold production seen in the past two years, and this has been reflected in our gold production target for the year," said CEO Reza Vaziri.
"However, this will be offset by increasing production of copper and we are confident that the initiatives that we are taking this year will provide the foundation of future sustained growth and development of the company.
"I look forward to updating our shareholders on our progress throughout 2017."