08:00 Mon 23 Oct 2017
Ariana Resources PLC - Kiziltepe quarterly operational update
AIM: AAU
KIZILTEPE QUARTERLY OPERATIONAL UPDATE
Operational Highlights:
· Production and sale of 3,762 oz gold and 15,985 oz silver during the period ending
· Operating cash costs for the quarter are estimated at
· Total gold and silver sales since start-up are 5,691 oz and 30,504 oz respectively.
· Gross income for the quarter is
· Processing plant fully-tested beyond design specifications; operational mill availability increased to 97% and utilisation increased to c.98% during September.
· Weighted average grade of ore mined in the period is 3.12 g/t Au and 43.7 g/t Ag, matching overall reserve expectations; higher grade ore is expected during Q4 as mining progresses deeper in to the Arzu South orebody.
· 35,049 tonnes ore milled during the period ending
· Approximately 46,000 tonnes of ore at a weighted average grade of 2.14 g/t Au stockpiled for future use; 19,700 tonnes of this total represents the fine ore stockpile at a grade of 2.60 g/t Au.
· Process recoveries of gold and silver remain higher than expected at c.95% for gold and 71% for silver as at the end of the quarter.
* Operating cash costs are inclusive of on-site costs and off-site charges and royalties specific to the project. It also includes adjustments for stockpile balances at the end of June and the end of September, in addition to an adjustment for by-product silver. They exclude finance costs, taxes and development capital. The definition used to derive the cash costs is essentially the same as that used within the feasibility study. This cash cost was calculated based on unaudited figures obtained from Zenit.
Current Developments:
· Production of ore from the open-pit achieved an average rate of 18,600 tonnes per month over the period, with a peak rate of over 22,600 tonnes achieved in August; such rates are planned to be maintained through Q4.
· Gold and silver pour in early October yielded an additional 482 oz and 4,088 oz respectively; these figures have not been added to the period totals.
· Gross loan repayments by Zenit to Turkiye Finans Katilim Bankasi A.S. have been made on their scheduled basis and have amounted to over
· Second larger diameter tailings pipeline installation complete and undergoing testing; will facilitate continued higher load on the tailings pumps while an additional diaphragm pump is procured to maintain higher-rate pumping at optimal cost.
· Space-truss roof being built to cover the pre-crusher ROM stockpile to minimise saturation of the ore and aid crusher throughput during periods of wet weather.
· Zenit has recently received a substantial recent Turkish VAT refund in line with the investment incentive schemes secured for the project.
Dr.
"This is an excellent result from our first quarter of commercial production. We have successfully increased our peak production rate from the open pit at Arzu South to over 22,000 tonnes of ore per month during the quarter. The process plant, in particular the mill, has also been tested successfully at its highest rates and work is progressing on achieving higher sustainable rates. To date this work has demonstrated that the operation has the capacity to achieve throughput rates substantially higher than feasibility parameters.
Most encouraging of all, we have demonstrated that the operating cash cost of production is well within the range of feasibility expectations. The operating success and process refinements undertaken by mine management demonstrate the capability and professionalism of our operations team and joint venture partners. I would like to take this opportunity to thank and congratulate both teams on their outstanding performance."
Table 1: Production statistics for the
Measure |
Unit |
Q3 2017 |
2017 Production to Date March to End-September |
Gold produced |
Troy Ounces |
3,762 |
5,691 |
Gold sold |
Troy Ounces |
3,762 |
5,691 |
Silver produced |
Troy Ounces |
15,985 |
30,504 |
Silver sold |
Troy Ounces |
15,985 |
30,504 |
Gross income |
US$'000 |
5,046 |
7,726 |
Operating cash cost of production |
US$/oz |
|
n/a(1) |
Average realised gold price |
US$/oz |
1,271.02 |
1,266.67 |
Average realised silver price |
US$/oz |
16.59 |
16.97 |
Average realised gold equivalent price(2) |
US$/oz |
1,341.52 |
1,357.60 |
(1) Cash costs are not provided for the purposes of the year to date due to the operation having been in ramp-up during part of the period. Costs incurred during the ramp-up period are not reflective of estimated operating costs over the longer term.
(2) Gold equivalent price accounts for both the gold and silver sold during the period and is calculated by dividing the gross income by only the gold ounces sold in the period.
Summary of Project
The Kiziltepe operation is currently expected to deliver approximately 20,000 oz gold equivalent per annum over eight years of initial mine life, for a total of up to 160,000 oz gold equivalent based on current resources. The operating company, Zenit Madencilik San. ve Tic. A.S. (50:50 JV between Ariana and Proccea) will continue to make repayments against its loan from Turkiye Finans Katilim Bankasi A.S. based on a pre-determined schedule. Major loan repayments will have been completed by
Commercial production was initiated at Kiziltepe during
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.
Contacts:
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Tel: +44 (0) 20 7407 3616 |
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Tel: +44 (0) 20 7628 3396 |
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Tel: +44 (0) 20 7382 8300 |
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Tel: +44 (0) 20 7886 2500 |
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Editors' Note
About
Ariana is an exploration and development company focused on epithermal gold-silver and porphyry copper-gold deposits in
The Company's flagship assets are its Kiziltepe and Tavsan gold projects which form the
In north-eastern
For further information on Ariana you are invited to visit the Company's website at www.arianaresources.com.
Glossary of Technical Terms:
"doré" semi-pure alloy of gold and silver;
"g/t" grams per tonne;
"kg" Kilograms;
"oz" Ounces;
"tpa" tonnes per annum;
"tpm" tonnes per month.
Ends
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