Ariana Resources PLC - 2020 PRODUCTION RESULTS AND GENERAL UPDATE

12 January 2021

AIM: AAU

2020 PRODUCTION RESULTS AND GENERAL UPDATE

Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed exploration and development company operating in Europe, is pleased to announce its full-year production results for the year ended 31 December 2020 for the Kiziltepe Mine ("Kiziltepe" or "the Project") in Turkey. Kiziltepe is currently 50% owned by Ariana through its shareholding in Zenit Madencilik San. ve Tic. A.S. ("Zenit"), which will reduce to 23.5% once the new joint venture with Ozaltin Holding A.S. ("Ozaltin") and Proccea Construction Co. ("Proccea") completes (details as announced on 7 December 2020 and ratified by shareholders on 30 December 2020).

Production Update*:

·    Kiziltepe produced a total of 18,645 ounces of gold during the year, exceeding its full year production guidance by 3.5%.

·    As at end 2020 the mine had produced a total of 84,200 ounces of gold and 915,233 ounces of silver, recording US$134 million in revenue since operations commenced in early 2017.

·    Mining operations are continuing at Arzu North and Derya, with plans to expand these open-pit operations currently under permitting review.

·    A processing plant expansion is underway, with construction due to be completed in H2 2021; the processing plant capacity will be increased by over 300% over the feasibility design and up to 500,000 tonnes of ore per annum.

* All figures are given gross with respect to the JV.

Dr. Kerim Sener, Managing Director, commented:

"The final quarter of 2020 rounded off another solid year of production for Kiziltepe, which once again exceeded joint venture guidance. We were further buoyed by gold and silver prices during the year, resulting in revenue exceeding US$37 million in 2020, and capping off an exceptional period of Company development for which our staff and our joint venture team must be commended.

"Since operations commenced at Kiziltepe, the joint venture company, Zenit, has successfully repaid US$36.7 million in debt to Turkiye Finans Bankasi A.S. Accordingly its relationships with lenders are very sound, which bodes well for future mine development projects at Tavsan and Salinbas, contemplated as part of our planned new joint venture with Ozaltin and Proccea.

"Following shareholder approval at our General Meeting at the end of 2020, we are now finalising the new joint venture, in which we will adopt a 23.5% interest alongside Proccea.  "Our reduced holding in the joint venture will naturally place a different emphasis on our operational activities going forward. Accordingly, as we transition into the new framework, we will report our production from the joint venture on a six-monthly, rather than quarterly, basis going forward.

"Meanwhile the Company is continuing to progress its exploration and development activities across its portfolio, which includes a drilling programme being undertaken within the joint venture and the start-up of field activities elsewhere. Notably we are expecting to increase the pace of our involvement in Venus Minerals, with the expectation that a diamond drilling programme at the Magellan Project can commence by Q2 2021; the current limitations imposed by travel restrictions notwithstanding. We are also fast-tracking some other exciting copper-gold project opportunities in the region, further details of which will be announced in due course."

Other Developments:

·    A two-rig diamond drilling programme for 4,000 to 5,000m commenced last week at Kiziltepe to test vein extensions at Arzu South, Arzu North, Derya and Banu, with the aim of further expanding the Kiziltepe resource; drilling may continue at the Karakavak prospect once drilling at Kiziltepe concludes.

·    Environmental, community and permitting activities have continued for the Tavsan and Salinbas projects through the winter, with resource drilling activities due to commence at Tavsan from spring 2021.

·    Percussion drilling by Venus Minerals in Cyprus for 1,705m (comprising 15 holes) on a conceptual structural target, has discovered an up to 12m thick, 50 x 300m silica-pyrite-chlorite alteration zone containing anomalous gold geochemistry at a depth of 50 to 80m below surface; planning is being finalised for a diamond drilling programme to commence on the Magellan Project in the coming months.

·    The Company is evaluating several copper-gold targets generated elsewhere in Eastern Europe and is looking to develop further interests in the region. 

Full Year Production Results

Contacts:

Editors' Note:

About Ariana Resources (details as current and before completion of the JV):

Ariana is an AIM-listed mineral exploration and development company operating in Europe.  It has interests in gold production in Turkey and copper-gold assets in Cyprus.  The Company is developing a portfolio of prospective licences in Turkey, which contain a depleted total of c. 2.1 million ounces of gold and other metals (as at July 2020). 

The Red Rabbit Project is comprised of the Company's flagship assets, the Kiziltepe and Tavsan gold projects, and is part of a 50:50 Joint Venture with Proccea Construction Co.  Both assets are located in western Turkey, which hosts some of the largest operating gold mines in the country and remains highly prospective for new porphyry and epithermal deposits.  The Kiziltepe Sector of the Red Rabbit Project is fully permitted and is currently in production.  The total depleted resource inventory at the Project and its wider area is c. 500,000 ounces of gold equivalent (as at April 2020).  At Kiziltepe a Net Smelter Return ("NSR") royalty of up to 2.5% on production is payable to Franco-Nevada Corporation. At Tavsan an NSR royalty of up to 2% on future production is payable to Sandstorm Gold.

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.

Ariana is also earning-in to 50% of UK-registered Venus Minerals Ltd ("Venus") and has to date earned into an entitlement to 12%.  Venus is focused on the exploration and development of copper-gold assets in Cyprus.

Panmure Gordon (UK) Limited is broker to the Company and Beaumont Cornish Limited is the Company's Nominated Adviser and Broker.

For further information on Ariana you are invited to visit the Company's website at www.arianaresources.com.

Ends.