Anglo Asian's Azerbaijan gold output down 8 pct in Jan-Sept

BAKU, Oct (HKSE: 3366-OL.HK - news) 13 (Reuters) - Azerbaijan's top gold producer Anglo Asian Mining (LSE: AAZ.L - news) said on Thursday its January-September output was 7.8 percent lower than in the same period last year at 49,874 ounces and it was cutting its 2016 production target.

The company reduced its 2016 output target to 69,000-71,000 ounces from a previous 73,000-77,000 ounces.

In 2015, it increased gold production by 19 percent to 72,032 ounces, hitting its target for the year.

The London-listed firm said it increased copper production at Azerbaijan's Gedabek main mine and the Gosha mine to 1,363 tonnes in the first nine months, from 634 tonnes a year earlier. The copper production target for 2016 is 1,700-2,000 tonnes.

Silver (Shenzhen: 300221.SZ - news) output rose to 114,915 ounces from 10,916 ounces.

"Whilst production during the period was impacted due to slightly later than anticipated commissioning of the second SAG (semi autogenous grinding) mill, total tonnes milled during the quarter increased, which partially offset the lower gold grades encountered," Anglo Asian CEO Reza Vaziri said in a statement.

"The company continues with its cost reduction and sustainability initiatives, and the connection of the Gedabek site to the national power grid by the end of next month will be another milestone."

The SAG mill is used to crush and grind ore.

The company commissioned a new flotation plant at Gedabek in the third quarter of last year and it began commercial production in the fourth quarter.

Gold (Other OTC: GDCWF - news) dore sales in the third quarter of this year totalled 12,567 ounces at an average price of $1,332 per ounce, down from 15,661 ounces sold in the second quarter at $1,265 per ounce.

Gold is produced at Gedabek and other Azeri mines under a production venture with Anglo Asian, in which the government owns 49 percent.

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. (Reporting by Margarita Antidze; editing by David Evans)