Ariana Resources (LSE:AAU), the AIM-listed exploration and development company operating in Europe, disclosed better-than-expected preliminary production results for the quarter ended 30 September 2020 for its Kiziltepe project in Turkey. Kiziltepe is part of the Red Rabbit Joint Venture ("JV") with Proccea Construction, in which Ariana owns 50% through its shareholding in Zenit Madencilik San. ve Tic. A.S.

Total gold production in the third-quarter of 2020 reached 5,125 ounces, which is an increase from 4,679 ounces in the previous quarter. The average metallurgical recovery of gold for the quarter remains high at 94.2%. The quarterly production increase reflects increased tons processed that more than offset the impacts of lower average grades.

As with the previous quarter, the Kiziltepe operation continued to demonstrate stable performance despite disruptions caused by the COVID-19 pandemic. “Material movements remain very high, while process plant throughput remains well above average, setting yet another record for the operation; the mill reached an annualised throughput rate of almost 230,000 tonnes per annum which represents an increase of over 53% above the feasibility designed rate.” Dr. Kerim Sener, Managing Director, said in a statement.

Notably, the company had to shift some of its operations in the second quarter owing to pandemic induced restrictions. Because production from the company’s highest-grade pit, Arzu South, came to a close during August, production had to shift entirely to the Arzu North and Derya pits. In the meantime, the Kiziltepe operation was able to maintain a stockpile of over 160,000 tonnes, sufficient to cover about ten months of mill feed at average throughput rates.

As a result of the consistent performance in the past two quarters, the present moment is opportune for a proposed mill expansion. The planned development will provide for an increase in throughput to 400,000 to 500,000 tonnes per annum.

There are additional plans for further development of the Arzu North area in the next quarter. This project is yielding substantially more ore tonnage than modelled previously. In fact, despite the expected reduction in grade, this increased tonnage coupled with continued high mill throughput will ensure output is maintained at the highest possible levels.

Ariana Resources’ Q3 production results were in part driven by the increase in demand for gold. Gold prices have gained 25% so far this year, primarily fueled by the global pandemic. Silver prices have also climbed 34% year to date.

The 100% owned Salinbas Gold Project is located in north-eastern Turkey and has a total resource inventory of c. 1.5 million ounces of gold.  The project comprises three notable licence areas: Salinbas, Ardala and Hizarliyayla, all of which are located within a multi-million ounce Artvin Goldfield.  The "Hot Gold Corridor" contains several significant gold-copper projects including the 4 million ounce Hot Maden project, which lies 16km to the south of Salinbas and 7km south of Hizarliyayla.  A NSR royalty of up to 2% on future production is payable to Eldorado Gold Corporation on the Salinbas Gold Project.

Author: Galina Mikova

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