In July 2010, Ariana Resources announced the Joint Venture (JV) of its Red Rabbit Project, with the Turkish construction firm Proccea Construction Co. (Proccea). A shareholders agreement between Galata Madencilik (Ariana’s 100%-owned subsidiary in Turkey) and Proccea provided for the incorporation of a Turkish joint stock company named Zenit Madencilik San. ve Tic. A.S. (Zenit).
Galata and Proccea may each own a 50% shareholding in Zenit subject to the terms of the JV. The ownership of the licences associated with the Red Rabbit Project were transferred from Galata to Zenit in October 2010. To date, Proccea has funded US$ 1.7 million towards the development of the Red Rabbit Project. Ariana currently holds 86% of the Joint Venture.
By funding an aggregate of US$8 million, Proccea may earn-in to its 50% shareholding in Zenit. The capital requirements for mine construction and start-up have been estimated in the Feasibility Study at US$29.5 million and the additional funding requirement will likely be completed via a facility to be arranged by Zenit. On the successful commissioning of the gold processing plant, the share of profit within Zenit will be 51% Galata and 49% Proccea.
The project development programme has been split in to three phases. In Phase 1 the management control of Zenit will be the responsibility of Galata and in Phase 2 and beyond, management control will lie with Proccea. Galata and Proccea have also agreed in principle to investigate other opportunities for mine development which may arise inside and outside of Turkey.
Proccea are funding US$1.4 million including all costs associated with the Feasibility Study (FS), Environmental Impact Assesment (EIA), permitting, land acquisition and additional exploration in the vicinity of Kiziltepe.
Encompasses the establishment of the processing plant, tailings and waste-rock disposal areas in addition to related mine infrastructure and facilities.
Production and further investment. This involves the longer term development of the Kiziltepe Sector and the advancement of the Tavsan Sector.
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