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Ariana Resources PLC - REVISED AGREEMENT WITH KEFI MINERALS PLC

RNS Number : 0578V
Ariana Resources PLC
04 August 2020
 

 

 

 

 

 

4 August 2020

AIM: AAU

 

REVISED AGREEMENT WITH KEFI MINERALS PLC: ROYALTY AND DATABASE

 

Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed exploration and development company operating in Europe, is pleased to provide details of a revised agreement with KEFI Minerals plc ("KEFI") and its wholly-owned subsidiary, Dogu Akdeniz Mineralleri San. ve Tic. Ltd. ("Dogu") concerning the Net Smelter Return ("NSR") on the Kizilcukur Project and an exploration database encompassing the Republic of Turkey.

 

Highlights:

 

·    Completion of the final agreement which cancels the 2% NSR on the Kizilcukur Project; Dogu will not be acquired by a subsidiary of Ariana, as had been envisaged in the announcement of 16 October 2019.

 

·    KEFI's exploration database on Turkey (compiled since 2007), will be transferred to Ariana and complement the Company's existing databases.

 

·    Total cash consideration of £75,000 payable to KEFI, of which a £15,000 payment has already been made (as detailed in the announcement of 16 October 2019).

 

·    Ariana will also acquire from Dogu, on a conditional basis, a 2.5% NSR which exists on the Koza Altin İşletmeleri A.Ş. ("Koza Gold") owned Yatik Project, following payment of a further £75,000 to KEFI.

 

·    In the event that mining commences on the Yatik Project, 50% (after costs) of the royalty payments made by Koza Gold to Ariana will be paid by Ariana to KEFI.

 

Dr. Kerim Sener, Managing Director, commented:

 

"Following the final due diligence completed on Dogu, Ariana and KEFI determined to proceed with the proposed transaction on slightly revised terms. Significantly, the originally proposed acquisition by Ariana of Dogu from KEFI is now no longer going to proceed. Instead, the 2% NSR existing on the Kizilcukur Project will be cancelled and it is envisaged that Ariana will acquire, on a conditional basis, an additional NSR royalty of 2.5% on the Koza Gold-owned Yatik Project. The latter royalty will be the first royalty owned by Ariana and represents future value in a region that remains actively explored and developed by Koza Gold and several other companies."

  


Kizilcukur Project

 

The Kizilcukur Project consists of one operational licence located in the Balikesir Province in Western Turkey (coordinates: 626150 mE; 4360440 mN). The property lies 22km to the northeast (straight line) and 70km by road from the Kiziltepe Sector of the Company's Red Rabbit Project.  Ariana has the option to sell the project to Zenit Madencilik San. ve Tic. A.S. (the operating company for the Kiziltepe Mine) at three times the exploration cost.

 

The project covers an area containing a series of sub-parallel quartz veins hosted by ophiolitic units that trend northwest and extend for about two kilometres. The veins exhibit classic low-sulphidation epithermal features and attain a maximum true width of 8m. The Zeki vein extends over a strike length of 820m. Composite rock-chip sampling of 80m strike along this quartz vein returned encouraging assay results of 6m at 3.3 g/t gold, 2m at 9.6g/t gold and 1m at 7.2 g/t gold prior to drill-testing. The peak rock-chip assay result in this area was 152 g/t gold and 1,320 g/t silver.

 

A JORC 2012 compliant Mineral Resource estimate was prepared for the Kizilcukur Project and Whittle optimisation conducted in 2016 identified the potential for the development of three open pits.  The Mineral Resource was updated in 2020; Measured, Indicated and Inferred JORC categories stand at 255,000 tonnes at 2.57g/t gold + 75.01 g/t silver and demonstrates potential for further growth with additional drilling.  The management resource target for future exploration at Kizilcukur is currently 500,000 tonnes at >2 g/t gold + >70g/t silver.

 

Trial mining commenced within the central part of the Zeki Pit during 2017.  This pit is the largest and highest grade of the three pits defined following Whittle optimisation of the Kizilcukur resource.  The General Directorate of Mining Affairs approved blasting operations on the licence as part of the Mining Permit (as announced on 18 November 2015).  Further trial mining is being planned for 2020.

 

Yatik Project

 

The Yatik Project contains a 400m strike length of a gold-bearing epithermal vein system, which continues eastwards outside of the licence area, with a total length estimated to be at least 1.3km. Although up to 50m in width, the vein is on average 14m wide. Epithermal, chalcedonic quartz textures suggest a high level of exposure of the vein system with the potential for bonanza gold grades at depth.  Surface rock-chip sampling returned grades up to 11g/t Au.  Limited reverse-circulation ("RC") drilling to 60m depths by previous explorers returned up to 31m at 1.3g/t and 7m at 5.7g/t Au.

 

Koza Gold owns the remaining 900m of the eastern extension of the vein system.  Koza Gold is the owner of the Ovacik Gold Mine and processing plant, located 40km to the south of Yatik.  Koza Gold is exploring, developing and mining several other sites in the vicinity of both Ovacik and Yatik.  It is expected that the Yatik vein system will be mined at some time in the future and that the 2.5% NSR will become a paying royalty. 

 

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

 

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

James Stearns / Atholl Tweedie

 

 

 

Yellow Jersey PR Limited

Tel: +44 (0) 20 3004 9512

Dom Barretto / Joe Burgess / Henry Wilkinson

arianaresources@yellowjerseypr.com

 

 

Editors' Note

 

About Ariana Resources:

 

Ariana is an exploration and development company with mining operations focused on epithermal gold-silver and porphyry copper-gold deposits in Turkey, the largest gold producing country in Europe.  The Company is developing a portfolio of prospective licences originally selected on the basis of its in-house geological and remote-sensing database, which now contain a total of 2.1 million ounces of gold and other metals.  Ariana's objective is to cost-effectively add value to its projects through focused exploration and to develop its operations, primarily through well-financed joint ventures. 

 

The Company's flagship assets are its Kiziltepe and Tavsan gold projects which form the Red Rabbit Gold Project.  Both contain a series of prospects, within two prolific mineralised districts in the Western Anatolian Volcanic and Extensional (WAVE) Province in western Turkey.  This Province hosts the largest operating gold mines in Turkey and remains highly prospective for new porphyry and epithermal deposits.  These core projects, which are separated by a distance of 75km, form part of a 50:50 Joint Venture with Proccea Construction Co.  The Kiziltepe Sector of the Red Rabbit Project is fully-permitted and is currently in production.  The total resource inventory at the Red Rabbit Project and wider project area stands at 605,000 ounces of gold equivalent.  At Kiziltepe a Net Smelter Return ("NSR") royalty of up to 2.5% on production is payable to Franco-Nevada Corporation.  At Tavsan an NSR royalty of up to 2% on future production is payable to Sandstorm Gold.

 

In north-eastern Turkey, Ariana owns 100% of the Salinbas Gold Project, comprising the Salinbas gold-silver deposit and the Ardala copper-gold-molybdenum porphyry among other prospects.  The total resource inventory of the Salinbas project area is 1.5 million ounces of gold and 7.9 million ounces of silver, in addition to significant copper and molybdenum.  A NSR royalty of up to 2% on future production is payable to Eldorado Gold Corporation.

 

Panmure Gordon (UK) Limited are broker to the Company and Beaumont Cornish Limited is the Company's Nominated Adviser.

 

For further information on Ariana you are invited to visit the Company's website at www.arianaresources.com.

 

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.
 
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