Azernews.Az

Anglo Asian Mining plc, the gold producer in Azerbaijan, has launched a new drilling program at the Gadabay gold deposit, the company said.

``The reserves discovered during the first and second phase of drilling at the depth of 3,420 meters confirm considerable potential for further development and increase in the volume of reserves. The company has started a new program of drilling at the depth of 24,567 feet,`` CEO Reza Vaziri said.

According to preliminary results of a revaluation, the estimated gold reserves at the deposit are 738,958 ounces (about 21 tons), while those of copper - 57,069 tons and silver 5,927,487 ounces (168 tons).

Proven reserves of gold are 315,424 ounces (about 9 tons), while those of copper - 24,696 tons and silver 2,681,064 ounces (76 tons).

The ongoing evaluation of the deposit is to be completed in the second half of 2012.

In 2011, the total production at the field was reduced to 57,068 ounces (1.62 tons) of gold, 611 tons of copper, and 46,940 ounces (1.33 tons) of silver. Last year the company sold 49,304 ounces of gold at an average price of $1,573 per ounce.

First gold was produced at the Gadabay deposit in May 2009.

Anglo Asian Mining has the rights to develop six deposits in the south-west of Azerbaijan - Gadabay, Ordubad, Gosha Bulag, Gyzyl Bulag, Vezhnali and Soyutlu under a PSA agreement signed in August 1997 with the Azerbaijani government. Under the contract, production of about 400 tons of gold, 2,500 tons of silver and 1.5 million tons of copper at the deposits is planned.

Gold produced at the deposits is sent to Switzerland for refining. Bullions are brought to Azerbaijan and stored in the government`s vaults.