Anglo Asian Mining Plc (LON:AAZ) says it has enhanced the future production potential at its Gedabek mine in Azerbaijan with the discovery of a new gold target.
The prospect was found 3 km north-west of the miner's agitation plant and heap leach facilities and has been called 'Ugur', which means 'good luck' or 'success' in Azeri.
Early testing after sampling and drilling has shown the oxide zone is amenable to leaching, with average gold recovery of 87%.
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The firm said: "This prospect is very exciting given its close proximity to the Gedabek processing facilities and the initial positive drill and metallurgical testwork results."
Chief executive Reza Vaziri added that Ugur had the potential to add significantly to the group's gold resources and reserves and hence future production at Gedabek.
"Having recently returned to profitability, and following the completion of several operational initiatives to improve efficiencies and lower costs at Gedabek, I believe Anglo Asian is now well positioned to expand its mineable reserves which will lay the foundations for long term and sustainable production from multiple deposits at Gedabek."
Twenty reverse circulation (RC) holes were sunk for 360 metres, with highlights including 34 metres at 0.39 grams per tonne (g/t), including 13 metres at 0.83 g/t, and another hole, which showed 34 metres at 5.45 g/t.
Significantly, a further exploration target has been defined in the expanded Ugur area located about 1,500 metres to the south of the current Ugur drilling area.
Anglo Asian said an initial Phase II core drilling programme has now started to determine overall depth and style of mineralisation with a view to increase resources.
Last week, the firm revealed that a delay to commissioning of a second mill hit production in the third quarter but it repeated its full year gold production target.
Gold output in the period was down at 16,497 ounces compared to 19,375 ounces in the second quarter, while copper production came in at 485 tonnes, compared to 497 tonnes in the second quarter
The firm produced 33,899 ounces of silver compared to 52,214 ounces the previous quarter.
Shares gained 1.99% to 19.25p on the day.