Anglo Asian soars after boosting reserves at Ugur gold project

Shares in Azerbaijan's top gold producer Anglo Asian Mining (LON:AAZ) soared Monday after the company boosted resource estimates at its Ugur gold deposit and said the project, located by its flagship Gedabeck mine, was on track to begin production next month.

Ugur, scheduled to begin production next month, is now known to contain 199,000 ounces of gold and 1,049,000 ounces of silver.

The London-listed firm said Ugur is now known to contain 199,000 ounces of gold and 1,049,000 ounces of silver, while the proven and probable reserves stand at 147,000 ounces of gold and 808,000 ounces of silver.

The miner also said that mining and haulage of ore to the processing facility stockpile at the project would begin before the end of the month, with production to start in September.

Anglo Asian’s stock skyrocketed on the news, trading 9.7% higher at 25.50p shortly after 2:00PM GMT.

The company, which also produces copper and silver, started a significant exploration program at the end of last year after making a new gold discovery at Ugur, located just km (1.8 miles) from Gedabek’s processing facilities.

Gold is produced at Gedabek and other Azeri mines under a joint venture between Anglo Asian and the country's government, which has as 49% stake.

Anglo Asian began production at Gedabek, 350 km west of the capital Baku, in July 2009 with plans to extract 22 tonnes of gold. Overall, Anglo Asian plans to exploit seven mines in western Azerbaijan with estimated gold reserves of 430 tonnes.