TIDMAAU
RNS Number : 1864S
Ariana Resources PLC
15 March 2021
15 March 2021
AIM: AAU
2021 JV PRODUCTION GUIDANCE
Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed
exploration and development company operating in Europe, is pleased
to announce the production guidance for 2021 for its joint venture
Kiziltepe Mine ("Kiziltepe" or "the Project"). Kiziltepe is 23.5%
owned by Ariana through its shareholding in Zenit Madencilik San.
ve Tic. A.S.
Highlights:
-- Gold production guidance for 2021 from Kiziltepe is expected
to be c. 19,000 ounces of gold*, c. 90% above feasibility plan for
this approximate stage of mine life.
-- Average monthly production is expected at approximately
27,000 tonnes of ore, peaking during Q2 2021; a stockpile of over
240,000 tonnes, representing well over a year of current production
capacity, has already been built up on site.
-- Ore throughput to the mill during 2021 is expected to be c.
325,000 tonnes, once operating capacity is increased as planned,
which represents a 115% increase over the feasibility plan.
-- Average grade of gold to be mined during the year is expected
to be c. 2.1 g/t Au and gold recovery is expected to exceed
90%.
-- Open-pit mining will continue largely at the Arzu North pit
during 2021, with some mining being undertaken concurrently at the
Derya pit.
-- Plant expansion to an operating capacity of up to 500,000
tonnes of ore per annum is well underway and scheduled for
completion in early Q3 2021; new mill has recently been installed
(Figures 1, 2 & 3).
-- Expansion plan being funded through a capital loan of US$6.6
million (inclusive of interest) to Zenit through Turkiye Garanti
Bankasi A.S., of which 25% has already been repaid, with nine equal
quarterly payments remaining.
Dr. Kerim Sener, Managing Director, commented:
"This year's production guidance from the joint venture follows
on from the completion of our arrangements with Ozaltin Holding
A.S. and Proccea Construction Co. With the enhanced JV now formally
underway, we are pleased to report on JV plans to increase the
operational capacity at Kiziltepe. This will see a marked positive
impact on production output and will continue to ensure the lowest
possible unit costs. During Q1 2021, mining has largely focused on
the Arzu North open-pit, within which significant additional gold
mineralisation has been encountered outside of the original mine
reserve. This bodes well for JV production plans and may have a
positive impact on the mining schedule, which is nominally
targeting circa 19,000 oz gold in 2021.
"By early 2020, the entire JV capital development loan of US$33
million was repaid to Turkiye Finans Katilim Bankasi A.S. The JV is
currently paying down its remaining working capital loan from the
same bank and this is about 70% complete, with US$3.1 million
requiring repayment from April to October 2021. A new loan facility
of US$6.6 million (inclusive of interest) with Turkiye Garanti
Bankasi A.S., providing the capital required for the plant
expansion, is already one quarter repaid.
"The continued positive economic environment for gold and silver
underpins the performance of the Kiziltepe mine, with both
commodities continuing to trade at near 5-year highs. With the
growing concerns over unsustainable levels of debt within major
economies, gold and silver are expected to continue to hold their
time-honoured position in the minds of investors. While the price
of oil has risen somewhat since late last year, the Turkish Lira
has continued its decline in value relative to the US dollar which
will again be reflected in lower dollar-based unit costs.
"Meanwhile, precautions are continuing to be undertaken at the
mine site against COVID-19. While issues associated with the
pandemic have not impacted gold production directly, some supply
issues have been encountered, specifically in the context of the
plant expansion programme. Despite this, the plant expansion is
still expected to be concluded by early Q3 2021 and factored into
the JV production guidance accordingly.
"With the wider JV now in place, we intend to advance our
collective interests in Turkey, continue with exploration and
development on behalf of the JV, progress with Ariana's earn-in and
the exploration programmes planned in Cyprus, as well as pursuing
separate opportunities elsewhere in Eastern Europe. As such, 2021
is set to be an exciting year for the Company and we look forward
to updating the market on these activities in due course."
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
* Silver production guidance is not provided, as silver is
treated as a by-product credit. All figures are stated gross to the
Project unless otherwise stated.
http://www.rns-pdf.londonstockexchange.com/rns/1864S_1-2021-3-14.pdf
Figure 1: Processing plant expansion programme fully underway at
Kiziltepe, with new semi-autogenous grind (SAG) mill about to be
lifted by the crane into position, within the new mill building. In
the foreground, additional pre-leach tanks are being
constructed.
http://www.rns-pdf.londonstockexchange.com/rns/1864S_1-2021-3-14.pdf
Figure 2: Installation of the new SAG mill at Kiziltepe, located
in its final position, within the new mill building.
http://www.rns-pdf.londonstockexchange.com/rns/1864S_1-2021-3-14.pdf
Figure 3: Summary schematic of the Kiziltepe processing plant,
showing the areas which have seen additions or substantial
modifications (outlined in red). A notable modification involves
the partial by-pass of the crushing units, specifically the cone
crushers, to allow the SAG mill to operate ahead of input into the
existing ball-mill. An additional liquid oxygen tank is being
installed in tandem with the two additional pre-leach tanks.
Summary of Project
The Kiziltepe gold-silver mine is expected to deliver an average
of approximately 20,000 oz gold equivalent per annum over eight
years of initial mine life, for a total of up to 160,000 oz gold
equivalent based on current resources. The operating company, Zenit
Madencilik San. ve Tic. A.S., is a JV between Ariana (23.5%),
Proccea (23.5%) and Ozaltin (53%). Management control of the JV
lies with Proccea. Commercial production was initiated at Kiziltepe
during July 2017 and has continued without interruption to the
present, with production consistently being delivered above
plan.
The latest resource estimate for Kiziltepe was based on recent
drilling and geological interpretation in April 2020. Detailed
technical and economic assessments are underway on several
satellite vein systems which are not currently in the mining plan,
in anticipation of these being developed in future years. The
Kiziltepe operation is currently targeting a minimum ten-year mine
life (to 2026), which will require the addition of a further 40,000
oz gold equivalent in reserves outside of the four main pits (Arzu
South, Arzu North, Banu and Derya) that are currently scheduled to
be mined. The joint venture is confident that this can be achieved
assuming the conversion of existing resources to reserves.
Contacts:
Ariana Resources plc Tel: +44 (0) 20 7407 3616
Michael de Villiers, Chairman
Kerim Sener, Managing Director
Beaumont Cornish Limited Tel: +44 (0) 20 7628 3396
Roland Cornish / Felicity Geidt
Panmure Gordon (UK) Limited Tel: +44 (0) 20 7886 2500
John Prior / Hugh Rich / Atholl
Tweedie
Yellow Jersey PR Limited Tel: +44 (0) 7951 402 336
Dom Barretto / Joe Burgess / Henry arianaresources@yellowjerseypr.com
Wilkinson
Editors' Note:
About Ariana Resources:
Ariana is an AIM-listed mineral exploration and development
company with an exceptional track-record of creating value for its
shareholders through its interests in active mining projects and
investments in exploration companies. Its current interests include
gold production in Turkey and copper-gold exploration and
development projects in Cyprus.
The Company holds 23.5% interest in Zenit Madencilik San. ve
Tic. A.S. a joint venture with Ozaltin Holding A.S. and Proccea
Construction Co. in Turkey which contains a depleted total of c.
2.1 million ounces of gold and other metals (as at July 2020). The
joint venture comprises the Kiziltepe Mine and the Tavsan and
Salinbas projects.
The Kiziltepe Gold-Silver Mine is located in western Turkey and
contains a depleted JORC Measured, Indicated and Inferred Resource
of 227,000 ounces gold and 0.7 million ounces silver (as at April
2020). The mine has been in profitable production since 2017 and is
expected to produce at a rate of c.20,000 ounces of gold per annum
to at least the mid-2020s. A Net Smelter Return ("NSR") royalty of
2.5% on production is being paid to Franco-Nevada Corporation.
The Tavsan Gold Project is located in western Turkey and
contains a JORC Measured, Indicated and Inferred Resource of
253,000 ounces gold and 3.7 million ounces silver (as at June
2020). The project is being progressed through permitting and an
Environmental Impact Assessment, with the intention of developing
the site to become the second joint venture gold mining operation.
A NSR royalty of up to 2% on future production is payable to
Sandstorm Gold.
The Salinbas Gold Project is located in north-eastern Turkey and
contains a JORC Measured, Indicated and Inferred Resource of 1.5
million ounces of gold (as at July 2020). It is located within the
multi-million ounce Artvin Goldfield, which contains the "Hot Gold
Corridor" comprising several significant gold-copper projects
including the 4 million ounce Hot Maden project, which lies 16km to
the south of Salinbas. A NSR royalty of up to 2% on future
production is payable to Eldorado Gold Corporation.
Ariana is also earning-in to 50% of UK-registered Venus Minerals
Ltd ("Venus") and has to date earned into an entitlement to 16%.
Venus is focused on the exploration and development of copper-gold
assets in Cyprus which contain a combined JORC Inferred Resource of
9.5Mt @ 0.65% copper (excluding additional gold, silver and
zinc).
Panmure Gordon (UK) Limited is broker to the Company and
Beaumont Cornish Limited is the Company's Nominated Adviser and
Broker.
For further information on Ariana you are invited to visit the
Company's website at www.arianaresources.com .
Glossary of Technical Terms:
"Au" chemical symbol for gold;
"g/t" grams per tonne;
"JORC" the Joint Ore Reserves Committee;
"oz" Troy ounces;
Ends.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
MSCGZGMFGDMGMZZ
(END) Dow Jones Newswires
March 15, 2021 03:00 ET (07:00 GMT)
Ariana Resources (LSE:AAU)
Historical Stock Chart
From Mar 2024 to Apr 2024
Ariana Resources (LSE:AAU)
Historical Stock Chart
From Apr 2023 to Apr 2024
