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Ariana Resources eyes Cyprus for next exploration project

Snapshot

The company is currently exploring and developing one million ounce Salinbas Gold Project in north-eastern Turkey

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Quick facts: Ariana Resources PLC

Price: 1.975 GBX

AIM:AAU
Market: AIM
Market Cap: £20.93 m
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  • Ariana Resources PLC is an AIM-listed gold-silver exploration and development Company with operations in Turkey

  • Gold and silver production started in July 2017 at Kiziltepe, part of the wider Red Rabbit Gold Project in joint venture with Proccea.

  • The Company is currently exploring and developing one million ounce Salinbas Gold Project in north-eastern Turkey, where the 4mln oz Hot Maden project is 16km to the south

  • Wholly-owned Australian subsidiary Asgard Metals has investments in a number of lithium/antimony projects in that country

 

How is it doing

Turkey-focused gold miner Ariana Resources PLC (LON:AAU) reported a seven-fold increase in its half-year profits before tax, with £2.3mln recorded in the six months to June 2019.

Net profit was £1.2mln, against £319,000 cashed in during the first half of 2018.

Gold production increased by 14% year-on-year at an operating cost below £406 (US$500) per ounce, one of the lowest globally.

 

What’s next

The company expects to reveal ‘in due course’ its plans for Cyprus, where it has been carrying out due diligence on a potential exploration portfolio for two years.

In Turkey, there have been discussions with companies for the development of the wholly-owned Salinbas Gold Project, holding 1mln oz od gold equivalent, to select a suitable partner.

In October, Ariana had its licences in this 'Hot Gold Corridor' extended for a further five years until 2024.

The junior owns 100% of the Salinbas project through its shareholding in Greater Pontides Exploration.

The Red Rabbit joint venture, which is 50%-owned by Ariana, has so far completed geotechnical and hydrological drilling, a preliminary site plan and process flow-sheets for Tavsan.

Ariana sees potential to expand the Tavsan project in Turkey after new mineral discoveries outside of the initial mine plan.

 

What the boss says: Kerim Sener, Managing Director

"We completed 2,200-odd metres of drilling, that was testing the zone between the Salinbas gold-silver system and the Ardala copper-gold-molybdenum porphyry to try to establish the link between those two systems, and what we can say conclusively now is that they are intimately interlinked and that actually boards very well for further exploration."

"Cyprus makes a lot of sense in many different ways, obviously the geographic proximity, the cultural similarity with Turkey, and also in terms of the mineral deposit styles… We see the same type of deposit in a number of mineral belts in Turkey."

 

Watch the interview

 

Inflexion points

  • The company has now paid off 78% of the £26mln (US$33mln) loan taken out for its flagship mine Kiziltepe in Turkey, a 50/50 joint venture with Proccea Construction Co.

  • Once the construction loans are repaid, Ariana will receive a much larger, pro-rata share of Kiziltepe’s income.

  • Annual production rises to 50koz/year (from 25koz/year) following the hoped-for commencement of mine development at Tavsan during 2020.

  • LIcences at Salinbas renewed until 2024 with mining permit area at Ardala extended

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