Thursday, 05 March 2009 08:06
| 5 March 2009 AIM / PLUS Markets: AAU TRIAL PRODUCTION FROM KIZILTEPE COMMENCES
Ariana Resources plc ("the Company"), the gold exploration and development company focused on Turkey, is pleased to announce the completion of an agreement with Eti Gümüs AS. ("Eti") to process ore from the Company's Kiziltepe deposit on a trial basis. Ariana will receive, through its operating subsidiary, Galata Madencilik San. ve Tic. Ltd. ("Galata"), an up-front signing fee from Eti of US$ 10,000 which will be deducted from proceeds once the first 1,000 tonnes of ore has been processed.
The initial agreement with Eti entails a large-scale (5,000 tonnes) process trial of Kiziltepe ore using the Gümüsköy processing plant, owned by Eti and located in Kütahya Province in western Turkey. Ahead of the agreement detailed below, the Company undertook a smaller test-run of some 25 tonnes of ore through this plant, from which very good recoveries of between 82.3% and 89.7% gold were achieved.
Dr. Kerim Sener, Managing Director, commented:
"This event marks the dawn of a new era for Ariana Resources. We have successfully made the transition from explorer to a committed developer of gold resources in Turkey. In partnership with Eti Gümüs, we have now followed through with our resolve to see the resource at Kiziltepe mined.
"This achievement represents the natural evolution of our long-term strategy and takes us one step closer to our aim of becoming a significant gold producer in Turkey. This success also highlights the determination of our management team to maximise the value of our resources, despite the difficult conditions faced by all junior companies.
"We are particularly proud of the solidarity and effort our team has shown to bring about this achievement. It is through their sense of purpose and commitment, and indeed that of our loyal shareholders, that we have achieved this milestone. We thank and congratulate them. We also look forward to working with our partners, Eti Gümüs, to make this trial a success, for both companies."
Details of Trial
Ariana will be responsible for mining and trucking the ore to the Gümüsköy plant, 130km to the east of Kiziltepe. All permits and rights have been secured for mining operations to commence, and an initial pit-design/mining plan has been completed jointly by the company's Mining Engineer and Project Manager; individuals with extensive mine operational backgrounds in Turkey.
Within one month, the Company expects to extract 5,000 tonnes of ore from the Arzu South vein of the Kiziltepe deposit. Ore will be stocked and sampled at Kiziltepe in the first instance. Following receipt of grade control data, any ore over 4.5 g/t Au will be transported by road to the Gümüsköy plant for processing. Eti will review mining progress at Kiziltepe on a periodic basis.
Formal quotes have been received by Galata for drilling, blasting, general mining operations and transportation. Following completion of the agreement, contracts for mining and transportation will be finalised with the relevant contractors, and mining operations are expected to commence within 15 days. The initial pit will be approximately 100m long and optimised for the recovery of high-grade ore.
Over a period of 45 days after receiving the first batch of ore from Kiziltepe, Eti will be responsible for processing the ore and all analytical costs associated with process grade control. Galata will undertake periodic quality control of Eti process analytical results by supplying control samples to their laboratory.
Eti will feed the Kiziltepe gold-silver ore in to their plant at a measured rate, along with silver ore from their Gümüsköy mine; any gold recovered will be attributable to Kiziltepe. Ariana will review progress at Gümüsköy on a periodic basis while the processing is underway and will send to site a metallurgist to review Eti process data and controls.
Gold produced from the operation will be divided on a 50-50 basis between the parties. Expected recovery of gold will be 85%, in line with the earlier test results detailed above. Silver recoveries will be considerably lower, as the silver grade of ore supplied to Eti is considered marginal for processing and, in any case, the Company has agreed that any silver obtained from the plant will be retained by Eti. Gold retained by Ariana will be refined at the Istanbul Gold Refinery or a suitable alternative.
If this trial operation is deemed successful by both parties, Galata and Eti have determined to discuss a processing arrangement which would be governed by a new agreement.
About Eti Gümüs A.S.
Eti Gümüs A.S. owns and operates the Gümüsköy silver mine in Kütahya Province, western Turkey. It is currently the largest silver mine in Europe and has been operational since 1987. The process plant has a designed annual throughput rate of 1,000,000 tonnes per annum and produces a maximum of 122 tonnes of silver per annum using the Merrill-Crowe system; a process for separating silver and gold where high Ag:Au ratios prevent the use of carbon as an effective recovery technique. The company's production meets 45% of annual Turkish silver demand
Contacts:
Editors' note:
About the Kiziltepe Deposit
The Kiziltepe deposit is located within a ten-year renewable operating licence that forms part of the Company's 100% owned Sindirgi Gold Project in Balikesir Province, western Turkey. The current JORC resource of 186,000 ounces gold equivalent is contained within the Arzu South, Arzu North, Banu and Derya veins.
Kiziltepe lies approximately 130km west of the Gümüsköy silver mine, 100km east of the one million ounce vein-hosted Ovacik gold mine and 115km northwest of the five million ounce Kisladag gold mine. The deposit hosts over 20km in strike length of gold-silver bearing low-sulphidation epithermal quartz veins across an area of at least 3km by 1km. Individual veins are exposed for up to 750m and widths vary between 1m and 14m. The main veins trend northwest, dip to the northeast and are hosted within Miocene age dacitic volcanic rocks.
Ariana acquired the Sindirgi Gold Project from Newmont Mining Corporation (NYSE & ASX: NEM; TSX: NMC) in March 2005. Franco-Nevada Corporation retains the right to a royalty of up to 2.5% on future gold production from the Sindirgi Gold Project.
About Ariana Resources
Ariana is an exploration and development company focused on epithermal gold-silver and porphyry copper-gold deposits in Turkey. The Company is exploring a portfolio of prospective licences selected on the basis of its in-house geological and remote-sensing database, on its own in western Turkey and in Joint Venture with European Goldfields Limited in north-eastern Turkey.
The Company's flagship assets are its Sindirgi and Tavsan gold projects. Both projects 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, are presently being assessed as to their economic merits. The total resource inventory of the Company stands at 401,000 ounces of gold equivalent.
Loeb Aron & Company Ltd. and Alexander David Securities Limited are joint brokers 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.
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