Gold, copper and silver producer Anglo Asian Mining announced the completion of phase II core drilling and additional development progress at its Ugur gold deposit - located on the company's Gedabek licence area in Western Azerbaijan - on Monday, ahead of targeted first mining in the fourth quarter.
The AIM-traded firm said "considerable progress" had been made at the newly discovered Ugur gold deposit ahead of its intended first production in the fourth quarter, which supported the board's strategy to increase exploration activities at its Gedabek licence alongside continuing production to optimise long-term profitable and sustainable production.
Ugur production would contribute to Anglo Asian's total gold equivalent target for 2017 of 64,000 to 72,000 ounces, it added.
It reported that the phase II core drilling programme was completed at the end of April, to enable resource and reserve estimation in the third quarter.
The drilling expanded the total resource potential at the Gedabek licence, providing "significant" potential upside to the company's future gold production, the board said, adding that independent quality assurance and quality control assaying of drill samples was underway.
An independent geotechnical-hydrogeological study was also completed for an open pit mine design, adding that further metallurgical test-work confirmed the amenability of gold ores to leaching.
The haul road design had been finalised following the completion of a detailed topographic survey of the area between the Ugur gold deposit and the Gedabek processing facilities.
Looking ahead, JORC reserve calculation and the ore extraction plan were targeted for completion in the third quarter.
The board also claimed there was "significant" upside potential from the results of alteration mapping, with core drilling of the flanks of the main zone planned.
"As a result of the accelerated work programme conducted at Ugur over recent months, we are on track to deliver a JORC reserve and ore extraction plan in Q3 2017 - less than a year after the deposit's initial discovery," said Anglo Asian CEO Reza Vaziri.
"As a production company with multiple mines, both open pit and underground, the Ugur deposit will be an important new component of our evolving production portfolio.
"During the remainder of 2017, when production from stockpiles will play an important role in contributing to our total gold equivalent target of 64,000 to 72,000 ounces, bringing Ugur into production will be a welcome new development."
Vaziri said it would demonstrate the value the company was creating due to its increased emphasis on exploration to create future flexibility and growth at the Gedabek licence.
"We look forward to seeing the results of our optimisation efforts in 2018 when full production recommences at Gedabek."