This will be the first time Caterpillar underground equipment will be deployed in Azerbaijan. The equipment will be substantially vendor financed and this is the first time Caterpillar will provide finance to a customer in Azerbaijan or the wider Caucasus region.
The underground mining fleet comprises three R1700 underground loaders and two 980UMA underground loaders. Borusan, the authorised regional dealer of Caterpillar equipment, will maintain a stock of spare parts and consumables within Azerbaijan and major parts will be held at Borusan regional centres in Türkiye and Kazakhstan. This will enable efficient after-sales servicing of the machines over their lifetime, which was a major factor in the machine selection process.
The underground mining fleet are “state-of-the-art”, next-generation machines constructed with safety at their core. They are more powerful and contain many new features compared to their predecessors. The operator environment has been improved and is more comfortable. Many new safety features have been added including better access points, multiple fire suppression systems, and improved visibility and lighting.
The underground equipment will be utilised in the company’s new Gilar mine, which is currently under construction and development. The deployment of the new underground equipment will require the recruitment of around 50 new local employees, including equipment operators and equipment maintenance and support staff. Approximately 800 local staff are currently directly employed by the company at Gedabek. In addition, the company also provides employment for around 600 local residents with the company’s contractors.
The total cost of the equipment is US$4.6 million. The US$3.7 million balance due for the purchase of the equipment will be paid by the end of December 2023 from the Group’s existing liquidity resources. It is anticipated that US$3.7 million will be refinanced by a vendor financing loan from Caterpillar. Negotiations are continuing with Caterpillar Finance to finalise execution of the loan which is expected to close in 1Q24.