www.chaarat.com
Chaarat Gold is an exploration and development company operating in the Kyrgyz Republic. The Company’s main activity is the development of the Kiziltash and Tulkubash projects situated within the Middle Tien Shan Mountains of Kyrgyzstan, which form part of the Tien Shan gold belt. The Company has delineated a JORC compliant mineral resource of 4.406Moz at a grade of 4.20g/t gold across both projects. Chaarat's key objective is to become a low cost gold producer; with initial production from the Tulkubash project, targeting annual production of over 200,000 ounces per annum as the Kiziltash project comes on stream.
Chaarat Gold splits flagship project to fast-track first production
Chaarat Gold (LON:CGH) has decided to split its flagship Chaarat project into two separate entities, in a move that could pave the way for gold production in 2011.
The company will now approach the ‘Tulkubash Zone’ and the ‘Main Project’ as two distinct projects.
The Chaarat project is located in the Kyrgyz Republic, and in its entirety it has a 4 million ounce resource. The Main Project comprises both the main and contact deposits, and it is being developed as an underground mine. Tulkubash has a different mineralogy and it is being developed as an open pit mine.
“This is an important and welcome development as it will enable the company to reach production earlier than previously anticipated,” Chaarat stated.
Chaarat plans to fast-track the Tulkubash open pit into production which it continues with the feasibility studies for the larger underground Main Project.
It believes that production could begin as early as the fourth quarter of 2011, after it produces a maiden resource statement in the first quarter and a definitive feasibility study in mid-2011.
Based on the work of the Chaarat project pre-feasibility study so far the company expects to produce around 40,000 ounces of gold per annum from Tulkubash and between 140,000 and 180,000 ounces from the Main Project.
The company highlighted that the Tulkubash deposit can be processed using a less capital intensive process, which presents an advantageous development route.
“The mineralisation in the Tulkubash formation is cleaner and more importantly, it is mostly free milling and thereby much more amenable to direct cyanidation without oxidation which is a relatively less capital and power intensive process,” Chaarat said.
Additionally the company believes that by bringing the Tulkubash into production earlier it will greatly simplify the development of the larger Main project.
The Main Project pre-feasibility study is ongoing and it is scheduled for completion in the first quarter of 2011.
The metallurgical aspects of the PFS have been completed, concluding that at least 88 percent of contained gold can be recovered.
Furthermore Chaarat told investors that the process plant has been designed, and subsequently capital costs are now expected to be lower than outlined previously in the scoping study.
The company believes the cost reduction is significant, as it includes extra costs of processing equipment that will enable the production of higher margin metal doré, rather than concentrate.
In the coming months, during the winter season, Chaarat plans to conduct a significant underground drilling programme.
Chaarat expect the drilling programme to allow it to proceed towards a full definitive feasibility study for the Main project, subject to results.
