Aim-listed gold, copper and silver producer Anglo Asian has lowered its production guidance for the year, as the conscription of several engineering staff and slowed tunnelling progress owing to rock faulting have impacted on production.
The company expects to produce between 68 000 and 72 000 gold-equivalent ounces (GEOs) from Gedabek, in western Azerbaijan, in 2020. Despite lower output, the miner will still reach its targeted turnover of $100-million.
Before the Armenia-Azerbaijan conflict, Anglo Asian had planned to produce between 75 000 and 80 000 GEOs.
The company reported that staff members who were conscripted owing to the territorial dispute with Armenia would return to work early in 2021, after the military started to demobilise.
Earlier this month, Armenia and Azerbaijan signed a Russia-brokered agreement to end a six-week military conflict over the disputed enclave of Nagorno-Karabakh. The region is internationally recognised as Azerbaijani but has been run by ethnic Armenians since 1994.
“On reflection, this has been a challenging year for the company. The difficulties started with the ongoing restrictions imposed due to the Covid-19 pandemic. The year is ending with a peace treaty in place between Azerbaijan and Armenia with international peacekeepers helping maintain the agreement.
"Despite all these headwinds, it is a testament to the entire workforce that the company has continued in operation and remains on track to achieve a turnover of over $100-million for the year, with a significantly strengthened balance sheet, whilst still paying dividends to shareholders,” said Anglo Asian CEO Reza Vaziri.
Anglo Asian would inform the market in due course about its plans for three contract areas that were included in the company's 1997 production sharing agreement with Azerbaijan, that were located within previously occupied areas.
The company said recently that it planned to start work at the Vejnaly project, located in the Zangilan district of Azerbaijan as soon as it is safe to do so. The Azerbaijani army last month liberated the Zangilan district from Armenia, ending the 27-year occupation of the mineral-rich district.