logo-loader

Chaarat Gold update reveals initial phase of Kyrgyz mine will be quicker and cheaper to build

Published: 07:01 20 Apr 2015 BST

gold_chart_55349746b8021

Chaarat Gold (LON:CGH) said it expects its mine in the Kyrgyz Republic to come into production a year earlier than planned with the upfront costs of the initial phase forecast to be lower than first budgeted.

Those were the two main headlines from a brief update on the definitive feasibility study being carried by the Chinese consultant NERIN.

The full report, giving all the costings and assessing the economics of the 6.1mln-ounce Chaarat project, is expected to be published by the end of the first half.

Today’s announcement reveals that NERIN has made some important and positive tweaks to the initial plan.

Chaarat has already told investors it expects to build the operation in two stages, ultimately producing 250,000 ounces of the precious metal a year.

Using the previous blue-print, the firm expected to mine 200,000 ounces at a cash cost below US$600 an ounce.

Chaarat has said it will initially focus on the easy to process oxide component of the resource.

Today it said the upfront capital cost of stage-one heap leach project will be reduced by delaying tunnel construction, though it didn’t say just what the saving would be.

It did reveal there would be a “positive uplift in the value of the project and reduction in implementation risk”.

The planned Tulkabash pit has ‘heap leachable’ gold reserves of 533,000 ounces, at a grade of 1.41 grams per tonne, giving a mine life of four-and-a-half years.

Initial production is likely to be in the order of 80-90,000 ounces, the company said.

Longer term, the Chaarat will process the refractory portions of the ore bodies using a process called bio-oxidation, pioneered by Goldfields of South Africa and used extensively in Russia and China.

It had originally expected to use pressure oxidation, which is more popular in the US.

Chief executive Dekel Golan confirmed the company is still looking to the People’s Republic for project finance.

“Recently the Chinese government announced its new Silk Road development strategy and set of priorities summarized as:  “one belt one road”.  This approach encourages Chinese companies to expand and invest in the Silk Road belt and in the seaways from China to Europe,” he said.

“This immediately identifies the Kyrgyz Republic as a top investment priority. The Chaarat Project is one of the largest and best undeveloped projects in the world and with a strong definitive feasibility study prepared by a reputable Chinese institute our ability to attract capital and interest from China has been enhanced.” 

Chaarat Gold makes strong progress with Tulkubash open-pit project in the...

Chaarat Gold Holdings Ltd (AIM:CGH) chief financial officer David Mackenzie joined Proactive's Stephen Gunnion with an overview of the company's operations in the Kyrgyz Republic, where it is advancing two significant projects on the same license: Tulkubash and Kyzyltash. Tulkubash, an...

on 23/1/24