Junior miner Ariana Resources plc (LON:AAZ) has taken 100% ownership of the Salinbas gold project in Turkey, sending its share price shooting higher.
Salinbas is adjacent to the highly regarded 4 mln oz Hot Maden development being undertaken by Mariana Resources (LON:MARL) and the whole area is growing in significance as a gold producing address.
Exiting partner Eldorado Gold will receive a 2% net smelter royalty on any gold produced in return for its 51% stake.
The two companies have been in partnership since 2012 at the property, which contains three deposits.
Salinbas has an 10Mt Indicated and Inferred JORC resource of 650,000 oz gold and 3.2Moz.
A scoping-study for an operation producing 50,000 oz of gold and 100,000 oz of silver annually over 10 years indicated a net present value of more than US$100mln.
The licence also contains the Ardala prospect that contains approximately 323,000 oz gold and copper and molybdenum credits and Hizarliyayla (gold and silver).
Kerim Sener, Ariana’s managing director, said that with the Kiziltepe mine to come onstream soon it wants to strengthen its pipeline.
“The Salinbas Project represents a major opportunity for the future growth of Ariana, coming with approximately 1Moz in JORC Indicated and Inferred resources in its own right and in a region with significant exploration upside, as underscored by the recent discovery of the approximately 4Moz Hot Maden project just 16 kilometres to the south.”
Kieron Hodgson at Panmure Gordon added that the multiple targets contained in the overall project area provide a high probability of significantly increasing the Ariana production profile well beyond the current 50koz per annum target.
Hodgson adds his 2.71p target price and ‘buy’ stance is largely reliant upon a conservative base case target of 22koz/pa gold equivalent from the existing Kiziltepe project.
Shares rose 17% to 1.78p.
-- update for broker comment, share price --