UPDATE 1-Anglo Asian finds gold at Azeri Ordubad mine

Mon Apr 23, 2012 1:17pm EDT

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BAKU, April 23 (Reuters) - Anglo Asian Mining said it had discovered gold at Ordubad mine, boosting its prospects for gold production in Azerbaijan, where it plans to increase production to over 300,000 ounces of the precious metal per year by 2015.

"The Notice of Discovery has been submitted following exploration work performed by Anglo Asian at its Piyazbashi and Agyurt deposits at Ordubad during 2010 and 2011, building on work performed in Soviet times," it said on Monday.

Anglo Asian Mining began gold production at Azerbaijan's major Gedabek gold and copper mine, 350 km west of the capital Baku, in July 2009. The company plans to extract more than 37 tonnes of gold from Gedabek.

It started exploration at some other mines, including the 462 square metres Ordubad mine, in 2010.

"Further information concerning the results of the studies and exploration work will be announced in due course and further exploration work is now planned with a view to confirming a small gold deposit with production potential," the company said.

Anglo Asian Mining reduced its gold production in Azerbaijan by 15 percent year-on-year to 57,068 ounces in 2011 from 67,267 ounces in 2010.

The company did not give a reason for the decline, while a source at Anglo Asian Mining told Reuters in January it was linked to "some financial problems, which are resolved now."

The company plans to increase gold production in Azerbaijan to 300,000 ounces per year by 2015.

It envisages exploration of seven mines in western Azerbaijan with estimated gold reserves of 430 tonnes.

The AIM-listed company is controlled by R.V. Investment Group Services. The Azeri government owns 49 percent.

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