- Soyudlu gold deposit. Photo: AzerGold.
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Azerbaijani state-owned mining company AzerGold has launched drilling and blasting operations at the Soyudlu (Zod) gold deposit in the Kalbajar District, on the border with Armenia.
The project has a complex legal and political history. The deposit was under Armenian control until the Second Nagorno-Karabakh War in 2020, after which it was returned to Azerbaijan.
According to Radio Free Europe/Radio Liberty (RFE/RL), the deposit was discovered in 1951 on the border between Azerbaijan’s Kalbajar District and Armenia’s Gegharkunik Province. Most of the deposit—75% of its gold reserves, or 17 out of 25 gold veins—was reported to be located within the territory of Azerbaijan.
However, by order of the USSR Ministry of Geology, management of the deposit was transferred to Armenia’s geological department. Commercial exploitation reportedly began in 1976, and by the early 1990s, 27.6 tons of gold had been extracted from it.
Following the collapse of the Soviet Union, the deposit on the Armenian side was operated for many years by the Russian company GeoProMining Gold. After Azerbaijan regained control over the territories following the 2020 war, GeoProMining withdrew.
In 1997, Azerbaijan signed a production sharing agreement with the US company RV Investment Group Services to develop mines in the area.
Anglo Asian Mining later succeeded RV Investment Group Services as the holder of the development rights.
However, because the Soyudlu deposit was under Armenian control at the time, the company was unable to conduct actual operations in Azerbaijani-controlled territories.
In 2022, the Azerbaijani government restructured the legal framework of the development agreement, introducing the Ministry of Ecology and Natural Resources as a party in 2022.
Subsequently, in June 2024, the state designated AzerGold as its representative under the agreement.
Since August 2025, large-scale geological surveys, topographical planning, and drilling operations totaling a depth of 18,000 meters have been underway at the deposit. Based on the geological surveys and exploration findings, the recoverable residual reserves of the Soyudlu gold deposit are estimated at 1 million ounces (28 tons).
A total of 236 people, including contractor employees, are currently involved in the Soyudlu project. Of these, 55 reside in the Kalbajar District.
During the initial development and construction phase spanning 2026–2029, approximately 700 people are expected to be employed directly and indirectly. Once the Soyudlu mine reaches full-scale production, more than 1,300 people are expected to be involved in the project.
Aliyev ‘bails out’ his daughters
AzerGold has been linked to corruption reports involving the family of President Ilham Aliyev.
In 2016, the Organized Crime and Corruption Reporting Project (OCCRP) published an investigation based on the Panama Papers leak, alleging that President Ilham Aliyev had granted mining rights to six gold deposits worth billions of dollars to a consortium allegedly owned by his daughters through offshore companies.
Under the undisclosed agreement, the daughters were to receive 70% of future mining profits, while the state was to retain the remaining 30%.
The investigation revealed that the mining operations were largely unsuccessful and loss-making, citing an official working at a company within the consortium who stated that its managers “clearly did not understand the mining business and made costly mistakes.”
Aliyev instructed the state-owned AzerGold to buy out the consortium in 2016. OCCRP described the buyout as a move that would “likely salvage the daughters’ investment.”
“It is not clear how much money the family will recoup from the failed venture, as the terms of the deal are still being finalized,” OCCRP wrote in May 2016.
At the time, OCCRP stated that Azerbaijan did not respond to its requests for comment.
OC Media has reached out to the Presidential Administration for comment regarding the OCCRP investigations.