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Kentor Gold gains exclusive window to acquire Aktash gold-copper deposit

Published: 08:24 21 Jul 2010 BST

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Kentor Gold (ASX: KGL) has inked an option agreement to acquire 100% of the Aktash gold-copper deposit in the Kyrgyz Republic.

Notably, Aktash is located just 8km from Kentor's planned Andash gold-copper processing plant site, potentially extending the projected mine life at Andash and increasing production estimates. Interestingly, there are no Kyrgyz laws preventing the operation of mines immediately adjacent to international boundaries.

Hellman and Schofield have an Exploration Target for the Aktash deposit under the JORC guidelines of 2 to 5 million tonnes of ore grading 2 to 3.5g/t Au, 0.3 to 0.7% Cu and 8 to 12g/t Ag.

With additional exploration upside for porphyry copper mineralisation similar to Andash at the northern end of the deposit close to the Kazakhstan border.

There has been historical exploration and assessment work undertaken at Aktash from 1990 to 1993, and from 2006 to 2009. A total of 59 drillholes have been completed, from both surface and underground, with assays on 785.6m of core being included in the data base.

The deal is subject to due diligence by Kentor which has an 18 month exclusive option window to acquire Aktash.   The option payments are US$200,000 for the first year, and US$200,000 for the remaining period. During the option period, Kentor has an obligation to drill a minimum of 1,500 metres.

Payment for exercising the option will be based on a JORC-compliant resource calculation, and has been agreed at:

- US$19 per ounce of gold
- US$105 per tonne of copper
- US$0.30 per ounce of silver

Managing director Simon Milroy said the appeal of Aktash was to the opportunity to increase the life of operations at Andash. The current estimated resource at Andash is 19.2 million tonnes @ 1.1 g/t gold and 0.4% copper for 680,000 oz gold and 77,000 tonnes copper. The project has an estimated JORC Mining Reserve of 540,000 oz gold and 63,000 tonnes copper.

The Andash Gold-Copper Project which is under development, is targeted to produce 70,000 oz gold and 7,400 tonnes copper in concentrate per annum.

Andash forms part of the world class TienShan gold belt, and notable for its low cash costs of US$29/oz (after credits).

The grade of the gold mineralization at Aktash is higher than at Andash, therefor including ore from Aktash in the feed to the process plant will likely result in increased annual gold production.

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