Ariana Resources takes a strong step forward at Kiziltepe satellite gold deposit (AAU)

A busy period for newsflow at Ariana Resources (LSE:AAU) continued on Thursday as the firm revealed that the latest round of work at one of its major satellite gold deposits in Turkey has completed. The business said rock-saw channel sampling has now finished at Kepez North, part of its 50:50 Red Rabbit joint venture ("JV") with Proccea Construction.

The work successfully met its objective of confirming and adding confidence to strong signs of gold mineralisation identified by previous work at Kepez. Among the strong intercepts encountered were 14.2 metres at 10.77 grams per tonne ("g/t") gold and 96 g/t silver and 10 metres at 11.54 g/t gold and 73 g/t silver.

Meanwhile, a scree sampling grid went beyond firming up old results, identifying a larger area of highly mineralised and broken material at the surface. Here, grab sample results included 36.37g/t gold and 247 g/t silver, 35/36 g/t gold and 200 g/t silver, and 27 g/t gold and 124 g/t silver.

Kepez is being developed as a high-grade satellite deposit for the Red Rabbit JV's Kiziltepe asset, which is currently in production. Kiziltepe currently spans four main pits and is expected to deliver an average of 20,000 ounces of gold equivalent per year over an initial eight-year mine life. However, Ariana believes that using the asset's facilities to process ore from additional deposits like Kepez can enhance these figures greatly.

For example, in Thursday's update, the company's managing director Dr. Kerim Sener said: "The in-situ grades and the widths of mineralisation reported add significant confidence to earlier work and will result in a more robust mineral resource estimate. We envisage this area being developed as a series of shallow open-pits producing ore which will be trucked approximately 14km to the Kiziltepe plant for processing."

Thursday's news comes just days after Ariana announced that it had received a watershed £1.6 million dividend from the Kiziltepe project. Likewise, earlier in March, the firm announced that 2020 gold production from Kiziltepe is expected to come in at around 18,000 ounces – nearly a third ahead of the project's feasibility plan for this stage of mine life. Meanwhile, ore throughput to the project's mill this year is expected to be c.205,000 tonnes – a 37% higher than estimated – while gold recovery is expected to exceed 90% at an average grade of 2.5 grams per tonne.

Elsewhere, this week also saw Ariana announce that a detailed assessment of its portfolio of Turkey-based gold assets has now completed with respect to a potential JV.  The explorer and developer said technical consultants to its proposed partner have completed an initial draft due diligence report covering its Kiziltepe, Tavsan, and Salinbas projects. A memorandum of understanding or the JV has now been extended to 30 April to enable the firm – currently identified only as a "major Turkish construction and engineering company" – to review the information.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, does not a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article’s content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

Ariana Resources reveals extension to JV discussions as Turkish gold portfolio review completes (AAU)

Wednesday saw Ariana Resources (LSE:AAU) reveal that a detailed assessment of its portfolio of Turkey-based gold assets has now completed with respect to a potential joint venture (“JV”). The £26.7 million explorer and developer said technical consultants to its proposed partner have completed an initial draft due diligence report covering its Kiziltepe, Tavsan, and Salinbas projects.

A memorandum of understanding (“MoU”) for the JV has now been extended to 30 April to enable the firm – currently identified as a “major Turkish construction and engineering company" – to review the information. Elsewhere, Ariana said that draft definitive legal agreements for the partnership are being reviewed by all parties involved.

Joint venture discussions for the project began last November when Ariana revealed the terms of the non-binding MoU, prompting a 30% increase in its share price at the time.  If the JV goes ahead, the firm will sell a 17% stake in Salinbas to its proposed partner for $5 million.  The third-party will then inject a further $8 million of equity into the asset via an earn-in arrangement and organise the bank finance to enable it to be brought into production. This would take its total position to 53%.

Alongside the Salinbas deal, the MoU also lays out some transactions for the Kiziltepe and Tavsan projects – currently held in a 50:50 JV called Red Rabbit between Ariana and Proccea Construction. Specifically, the partner would take on 53% of the JV in exchange for a $50 million payment that would be split between the Red Rabbit firms.

On Wednesday, Ariana’s managing director Dr. Kerim Sener said:

"We are pleased to report the completion of the due diligence work of the technical consultants.  A period of internal review will now be conducted by the Proposed Partner and Proccea.  In addition, draft definitive legal documentation has been prepared and is being reviewed by the Parties.  We look forward to reporting further on the proposed deal in due course."

The Salinbas gold project is based in north-east Turkey and has a total resource inventory of around 1 million ounces of gold equivalent. The asset is made up of three licence areas - Salinbas, Ardala and Hizarliyayla – and is based in an area known as the "Hot Gold Corridor". This contains several significant gold-copper projects including the 4 million ounce Hot Maden project, which lies 16 kilometres to the south of Salinbas.

Meanwhile the Kiziltepe Sector of the Red Rabbit Project is fully permitted and is currently in production. The total resource inventory at the project and its wider area is around 605,000 ounces of gold equivalent.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, does not a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article’s content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

 

Ariana Resources receives landmark £1.6 million Kiziltepe dividend (AAU)

Ariana Resources (LSE:AAU) enjoyed a 10% lift on Thursday morning after announcing a watershed dividend payment from one of its subsidiaries.

The Turkey-focused gold firm, which currently has a £28.1 million market cap, said it has been transferred a total of £1.6 million by its operating subsidiary Galata. Since early 2018, Galata has received a total of $7.3 million from another organisation called Zenit, which is in turn a 50:50 joint venture between Ariana and a construction company called Proccea.

Zenit owns the Kiziltepe gold project in western Turkey, where commercial production began in July 2017. Until its March 2020 AGM, Zenit had paid all its outstanding dividends from profitable operations at Kiziltepe to Galata to cover loans made for the project’s initial exploration and development. These profits are now being repatriated by Galata to its parent company Ariana in the form of dividends.

Once all loans have been repaid by Zenit – which expects to pay off its remaining $33 million bank loan this month – all Kiziltepe profits will be shared on a 51:49 basis between Ariana and Proccea respectively.

Ariana’s managing director Dr. Kerim Sener said Thursday’s dividend payment represents the “culmination of many years of effort” at Kiziltepe, adding that Galata is now his company’s “cash-generative engine of growth”.

Kiziltepe currently spans four main pits and is expected to deliver an average of 20,000 ounces of gold equivalent per year over an initial eight-year mine life. However, Zenit is completing expansion work with the aim of extending this mine life to a minimum of ten years – something that will require the addition of a further 40,000 ounces of gold equivalent. The JV has completed a new resource estimate based on recent drilling and geological interpretation, and technical and economic assessments are scheduled for several satellite vein systems not currently in the mining plan.

Earlier in March, Ariana announced that 2020 gold production from Kiziltepe is expected to come in at around 18,000 ounces – nearly a third ahead of the project’s feasibility plan for this stage of mine life. Meanwhile, ore throughput to the project’s mill this year is expected to be c.205,000 tonnes – a 37% higher than estimated – while gold recovery is expected to exceed 90% at an average grade of 2.5 grams per tonne.

Elsewhere, Ariana offered investors some reassuring words in respect of the global market pandemonium currently being driven by crashing oil prices and the spread of COVID-19.

Sener said weak oil prices will have a positive effect of the firm’s processing costs, also highlighting the benefits of a strong rise in gold prices as investors flee to safe haven assets. Despite a sharp fall in recent days as investors shifted into cash in response to stimulus measure by the US federal reserve, the metal remains close to the £1,300 an ounce mark.

“These, along with other positive trends including the declining value of the Turkish Lira, reinforce the economics of the Kiziltepe operation,” said Sener.

Finally, the chief executive said that Ariana is not anticipating disruption to its production schedule as a result of coronavirus. “If this situation changes then we will inform the market," he added.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, does not a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article’s content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

Ariana Resources strong in the face of falling markets as Kiziltepe gold guidance beats forecasts (AAU)

Ariana Resources (LSE:AAU) treated investors to an across-the-board positive update on Thursday.

The AIM-listed firm revealed that 2020 gold production from its Kiziltepe mine in Turkey is expected to come in at around 18,000 ounces – nearly a third ahead of the project’s feasibility plan for this stage of mine life. Meanwhile, ore throughput to the project’s mill this year is expected to be c.205,000 tonnes – a 37% higher than estimated – while gold recovery is expected to exceed 90% at an average grade of 2.5 grams per tonne.

Kiziltepe is jointly owned by Ariana and a construction company called Proccea as part of a joint venture called Red Rabbit. The project is expected to produce a total of 160,000 ounces over an eight-year mine life across four main pits -  Arzu South, Arzu North, Banu, and Derya. Work is also ongoing on several satellite vein systems currently absent from the Kiziltepe mining place, with the goal of bringing these into action in future years.

In Thursday’s update, Ariana said that open-pit mining will be completed in the Arzu South by the third quarter of the year. At this point, work will move entirely to the Arzu North and Derya areas.

The company’s managing director Kerim Sener said the strong guidance comes off the back of a particularly fruitful beginning to 2020 and a record-breaking end to 2019. “With the addition of lower grade ore and higher mining rates required from the satellite pits, such as Arzu North, we are expecting output to reach 18,000 ounces in 2020,” he added.

Critically, Sener also said the Red Rabbit JV will have paid off 99% of its $33 million capital loan from Turkiye Finans Katilim Bankasi by the end of this month. The imminent absence of repayment obligations should allow Ariana and Proccea to enhance Kiziltepe’s total production and life of mine, he said:

“Strategies have included planning associated with expanding mill throughput, investigating opportunities for expansion of our open pits and examining preliminary planning and design work required for potential underground operations.  Associated resource estimation and optimisation work has yielded encouraging results, which we will expand upon in due course.”

Elsewhere, Ariana offered investors some reassuring words in respect of the global market pandemonium currently being driven by crashing oil prices and the spread of COVID-19.

Sener said weak oil prices will have a positive effect of the firm’s processing costs, also highlighting the benefits of a strong rise in gold prices as investors flee to safe haven assets. Despite a sharp fall in recent days as investors shifted into cash in response to stimulus measure by the US federal reserve, the metal remains close to the £1,300 an ounce mark.

These, along with other positive trends including the declining value of the Turkish Lira, reinforce the economics of the Kiziltepe operation,” said Sener.

Finally, the chief executive said that Ariana is not anticipating disruption to its production schedule as a result of coronavirus. “If this situation changes then we will inform the market," he added.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, does not a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article’s content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

 

 

Ariana Resources reveals progress in Salinbas JV discussions (AAU)

Friday saw Ariana Resources (LSE:AAU) reveal positive progress in joint venture (“JV”) discussions for its Salinbas project in Turkey.

The firm said that its proposed, as-yet-un-named partner for the asset has completed 600 metres of reverse circulation drilling at the asset to twin four holes previously drilled by Ariana. Following the receipt of assay results from the work, “good correlations” have been found between the two sets of holes. As such, the parties involved in the potential JV have completed an extension agreement that will enable due diligence work to be completed up to the end of next month.

Wholly-owned by Ariana, Salinbas is located in north-east Turkey where it spans three highly-prospective licence areas called Salinbas, Ardala, and Hizarliyayla.

The Salinbas deposit (which lies within both the Salinbas and Ardala licences) contains an Indicated and Inferred JORC resource of c.10Mt at an average grade of 2g/t gold and 10.2g/t silver for approximately 650,000oz and 3.2Moz of the metals respectively.

Ardala, meanwhile, hosts a porphyry system with an Inferred JORC resource of 16Mt. This grades 0.6g/t gold for 323,000oz of the precious metal while also containing domains with up to 0.2pc copper and 0.01pc molybdenum.

Finally, Hizarliyayla, the least advanced of the three licence areas, is an epithermal prospect with a c.3km2 alteration zone prospective for both gold and base-metal mineralisation.

Joint venture discussions for the project began last November when Ariana enter a non-binding memorandum of understanding for the project with a ‘major Turkish construction and engineering company’. The agreement – which prompted a 30% increase in Ariana’s share price – proposes the sale of a 17% stake in Salinbas to the unnamed partner for $5 million.  The third-party will then inject a further $8 million of equity into the asset via an earn-in arrangement and organise the bank finance to enable it to be brought into production. This would take its total position to 53%.

Alongside the Salinbas deal, the MoU also lays out some transactions for the Kiziltepe and Tavsan projects – currently held in a 50:50 JV called Red Rabbit between Ariana and Proccea Construction. Specifically, the partner would take on 53% of the JV in exchange for a $50 million payment that would be split between the Red Rabbit firms.

Ariana’s managing director Kerim Sener provided further details on these discussions in Friday’s release:

"We are pleased to confirm that the due diligence confirmatory drilling programme at Salinbas has been concluded and can now be factored into the independent review. The efforts of the independent due diligence team are currently focusing on the Kiziltepe mining operations and, in order to provide sufficient time for the completion of this work, the proposed JV parties have extended the exclusivity period to the end of March.

Meanwhile, the necessary definitive legal documentation is being prepared for review by the proposed JV parties from the second half of February. We look forward to working closely with the proposed JV parties in order to conclude the proposed agreement and advancing our project development plans for Salinbas in particular."

To download and read our recent, in-depth report on the Salinbas project – please click here

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, does not a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

MiningMaven Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and MiningMaven Ltd are not responsible for the article’s content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance