Chaarat Gold Holdings Ltd (LON:CGH) shares surged in late-afternoon trading Wednesday after it reported a “significant increase” in the resource at its Tulkubash deposit in the Kyrgyz Republic.
The exploration firm said the updated measured and indicated (M&I) mineral resource was now over 1.6mln ounces of gold, an increase of 15% since an interim resource update in September 2018.
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The update includes results from the latest batch of 48 diamond drill holes, comprising approximately 9,370 metres, drilled since the September.
Chaarat added that an updated reserve estimate and financial model for the Tulkubash deposit based on the year-end resource model was being prepared and should be completed by the end of February 2019.
Due to the inclusion of some lower grade resource in the northeast strike extension, the average grade at Tulkubash fell by 0.15 grams per tonne (g/t) gold to 1.2 g/t, although the firm said this was compensated by “an increase in tonnage and continuity of mineralisation”.
The company said it now had a better understanding of the “local variability and controls on mineralisation within the mineable resource” which would provide “an excellent basis for short-term mine planning”.
Discovery costs at Tulkubash for 2018 were around US$11.4 per ounce of M&I resource with 33 ounces of gold per metre drilled.
Dusty Nicol, Chaarat’s technical director and head of exploration, said: “Discovery costs per ounce and ounces discovered per metre drilled are outstanding and continue to validate our belief that Tulkubash will continue to grow into a world-class gold deposit”.
“The mineralisation remains open along strike and we have drilled only a small portion of the prospective 24-kilometre trend of favourable geology and surface gold occurrences”.
Shares were up 5.9% at 28.8p.