Azerbaijan Transfers Mining Rights to AzerGold for Efficient Cooperation

Azerbaijan Transfers Mining Rights to AzerGold for Efficient Cooperation

Based on the Law ratified by the Milli Majlis and approved by President Ilham Aliyev on June 21, 2024, the authority to represent the state in the implementation of the Agreement on the exploration, development, and production sharing of gold, copper, and polymetallic prospective ore deposits has been transferred to “AzerGold” CJSC. This agreement covers deposits in Gadabay, Gosha, Kharkhar, Garadagh, the Ordubad group (Piyazbashi, Agyurd, Shekerdere, Kalaki), Gizilbulag, Damirli, and Vejnali, and was signed between the Ministry of Ecology and Natural Resources of Azerbaijan and the United States' “R.V. Investment Group Services, LLC”.

The main goal of this transfer is to ensure efficient cooperation between “R.V. Investment Group Services, LLC” and “AzerGold” CJSC, a state company specialized in the mining sector. Under the terms of the Agreement, “AzerGold” CJSC is responsible for granting rights and interests to “R.V. Investment Group Services, LLC”, supervising the efficient organization of activities, ensuring cooperation with government agencies for mining operations, and fulfilling other obligations.

The scope of operations under the Agreement includes the management of mines, geological exploration, production, manufacturing, environmental protection, work with local communities, and corporate social responsibility. These activities will be carried out by “R.V. Investment Group Services, LLC” under the supervision of “AzerGold” CJSC. “AzerGold” will ensure that the operator company's mining activities comply with local and international legal requirements.

Work has already begun on resolving issues arising from the Agreement and organizing activities promptly. A Working Group created under “AzerGold” CJSC has been tasked with conducting a general review of the areas where activities are organized, including infrastructure, analyzing the work done within the framework of the Agreement and the current situation, identifying necessary measures, and forming proposals within one month. Additionally, efforts are underway to establish a Steering Committee for the organization of activities and supervision.

The Agreement was initially signed on August 20, 1997, between the State Company "Azergizil" of Azerbaijan and “R.V. Investment Group Services, LLC”. Following the liquidation of "Azergizil" on January 22, 2000, the Ministry of Ecology and Natural Resources was considered the legal successor of the State Company until the new amendment to the Agreement.

As of April 1, the cumulative income generated by AzerGold JSC from the sale of precious metals amounted to an impressive 1 billion 213 million 911 thousand manats. Export revenues accounted for the majority of this income, totaling 1 billion 158 million 829 thousand manats, while sales in the domestic market contributed 55 million 82 thousand manats.

Azer Gold JSC plans to extract and sell 70 thousand ounces of gold this year. This means an increase of 10% in production and 3% in sales compared to the previous year.

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