BAKU, Feb 12 (Reuters) - Azerbaijan’s top gold producer, Anglo Asian Mining, said on Monday that it would be able to refinance most of its debt and free up capital for expanding its Gedabek mine after a subsidiary secured a $15 million syndicated loan.
Following the refinancing, the London-listed group said its debt principal repayment will fall to $5.1 million this year, releasing capital of $8.4 million to support expansion and efficiency initiatives at the Gedabek gold, copper and silver mine.
Anglo Asian operates the mine, 350 kilometres (218 miles) west of the capital Baku, in a joint venture with the government, with the company owning a 51 percent stake.
Its subsidiary Azerbaijan International Mining Company Limited secured the two-year loan from Azeri Pasha Bank OJSC Azerbaijan at a 7 percent annual fixed interest rate. The facility is unsecured and there are no financial covenants, Anglo Asian said in a statement.
It will use $13.5 million of the loan to repay existing loans to Amsterdam Trade Bank N.V., Gazprombank (Switzerland) Ltd., Anglo Asian’s CEO Reza Vaziri and Azeri Yapi Credit Bank, the company said.
Anglo Asian said last week that its gold output would rise to 64,000-70,000 ounces in 2018, from 59,617 ounces last year, and it expects its total metal production to increase to 78,000-84,000 gold equivalent ounces (GEO) in 2018, from 71,461 ounces last year.
Anglo Asian began production at Gedabek, the bigger of two mines it operates, in July 2009 with plans to extract 22 tonnes of gold. It eventually plans to develop seven mines in western Azerbaijan, including Gedabek, with estimated gold reserves of 430 tonnes in total. (Reporting by Margarita Antidze; Editing by Susan Fenton)