7 March 2016
AIM: AAU
Ariana Resources
100% INCREASE IN KIZILCUKUR RESOURCE
Ariana Resources plc ("Ariana" or "the Company"), is pleased to announce an increase and upgrade of its JORC compliant Mineral Resource estimate for the Kizilcukur Project following its recent drilling programme in Turkey. Kizilcukur is located outside of the Red Rabbit joint venture with Proccea Construction Co. and is 100% owned by Ariana.
Highlights:
· 100% increase in the Mineral Resource to c.308,000 t @ 2.11g/t gold and 73.4g/t silver, for 33,000 oz gold equivalent (Indicated + Inferred)
· Mineral Resource largely defined within three shallow (40-90m deep) open-pit shells following Whittle optimisation
· Potential for 18 months of add-on mine life for the Kiziltepe mining operation if the Kizilcukur area is developed as a satellite mining region
· Significant exploration upside along strike and on sub-parallel vein splays; potential remains for resource growth
· Mining permit already in place for seven years, as announced on 18 November 2015
Dr. Kerim Sener, Managing Director, commented:
"This is a very encouraging result from our first drilling programme at Kizilcukur. For only 1,598m drilled we have been able to expand the Mineral Resource by approximately 100%. This represents an exploration discovery cost of approximately US$7 per ounce, which has again emphasised how cost-effectively we are able to deliver on our exploration programmes.
The merits of Kizilcukur as a potential satellite operation to the Kiziltepe Mine are obvious, as early scoping works point to a potential 18 months of additional combined project mine life. In addition, due to the high grades encountered at Kizilcukur, the ore is of higher value on a dollar per tonne basis than some existing Kiziltepe satellite pits, so it would be logical to bring Kizilcukur forward in the mining schedule for Red Rabbit. Consequently, we will be discussing the potential sale of Kizilcukur in to the Red Rabbit joint venture with our partners over the coming months."
Resource Estimate
Following the completion of a 1,598m Reverse Circulation ("RC") drilling programme in November 2015 (See 18 January 2016 Announcement), geological consultants Odessa Resources Pty. Ltd. undertook a resource estimate for Kizilcukur. The previous estimate, completed in 2013, identified a JORC 2004 compliant Inferred Mineral Resource of 162,000 tonnes at 2.39g/t gold and 48.5g/t silver, for 16,600 oz gold equivalent, based on 17 historic diamond drill holes. The addition of 26 new infill and extension drill holes at Kizilcukur has increased the Mineral Resource by approximately 100% (c.308,000 tonnes at 2.11g/t gold + 73.4g/t silver) and has confirmed northwest and southeast strike extensions of the Main Vein.
The new Kizilcukur JORC 2012 compliant Mineral Resource estimate has been defined by 43 holes on 75 cross-sections with 10m section spacing (see JORC Table 1). Wireframes were constructed using sectional polylines defined by a cut-off of 0.5 g/t gold. Four lodes were created from the sectional interpretations, which are orientated at 315 degrees (NW) and dip steeply at 85 degrees towards the southwest (Figure 1). No top-cut was applied and a bulk density of 2.55 g/cm3 was assumed for the whole resource. Grade interpolation was by the Inverse Distance Squared ("ID2") method.
Whittle Optimisation
Whittle Pit Optimisation Software was used by Auralia Mining Consulting Pty. Ltd. to define pit shells on all-materials that contained grade within the resource block model. The optimisation work generated three pit shells, to be referred to hereon as the Zeki, Ziya and Zafer pit shells (Figure 1). The Whittle base case optimisation work was run using the parameters provided in Table 2. The Zeki pit shell is the largest with dimensions of 315 x 140 x 90m, followed by the Ziya (220 x 75 x 60m) and Zafer (140 x 50 x 40m) pit shells. The output of the Whittle optimisations is provided in Table 3. It is important to note that actual pit designs may vary from these optimised pit shells based on a variety of factors that will result from an increase in the accuracy and definition of future work, notably additional confirmatory drilling, geotechnical analysis and mine planning.
Metallurgy
Kizilcukur ore typically consists of oxidised quartz veins containing gangue manganese, rhodochrosite and haematite. Deeper within the vein system (+80m from surface) sulphide minerals become recognisable, mainly in the form of pyrite, chalcopyrite, galena and sphalerite. No metallurgical studies have been completed on the mineralisation to date, though samples for initial bottle-roll testwork are in the process of being prepared and sent for analysis. As much of the current resource sits within pit shells to a maximum depth of 90m, oxide ore will be the focus of metallurgical test work.
Exploration Potential
To date, only 35% of the total vein system has adequately been tested by drilling. Future drilling will need to target significant soil anomalies (up to 5 ppm gold), identified on the south-eastern flanks of the Kizilcukur vein system (Figure 2). Induced Polarisation (IP) studies completed in 2011 also generated several additional targets which remain untested. These suggest the vein system locally jogs in places, possibly due to faulting and/or later dyke intrusion. Two other complementary resistivity/chargeability anomalies are also identified along strike of the primary ore zones (Figure 2). These targets will need to be followed-up in future drilling, with estimated target depths of 70-90m below surface.
Details of the Kizilcukur Project
The Kizilcukur Project consists of one mining licence located in the Balikesir Province in Western Turkey (coordinates: 626150 m E; 4360440 m N). The property lies 22km to the northeast (straight line) and 50km by road from the Kiziltepe Sector of the Company's Red Rabbit Project. A royalty will be payable to Dogu Akdeniz Mineralleri San. ve Tic. Ltd. of 2% Net Smelter Return on commercial production from the Project. Ariana has the option to sell the project to Zenit Madencilik San. ve Tic. A.S. (the operating company for the Kiziltepe Mine) at three times the exploration cost.
The Project covers an area containing a series of sub-parallel quartz veins hosted by ophiolitic units that trend northwest and extend for at least two kilometres. The Main Vein exhibits classic low-sulphidation epithermal features and attains a maximum true width of 8m. The western quartz vein extends over a strike length of 820m. Composite rock-chip sampling of 80m strike along this quartz vein returned encouraging assay results of 6m at 3.3 g/t gold, 2m at 9.6g/t gold and 1m at 7.2 g/t gold. The peak rock-chip assay result in this area was 152 g/t gold and 1,320 g/t silver.
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Contacts:
Ariana Resources plc |
Tel: +44 (0) 20 7407 3616 |
Michael de Villiers, Chairman |
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Kerim Sener, Managing Director |
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Beaumont Cornish Limited |
Tel: +44 (0) 20 7628 3396 |
Roland Cornish / Felicity Geidt |
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Beaufort Securities Limited |
Tel: +44 (0) 20 7382 8300 |
Jon Belliss |
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Loeb Aron & Company Ltd. |
Tel: +44 (0) 20 7628 1128 |
John Beresford-Peirse |
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IFC Advisory Limited |
Tel: +44 (0) 20 3053 8671 |
Tim Metcalfe Graham Herring Heather Armstrong |
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Editors' Note:
Competent Person
The information in this report that relates to Mineral Resources is based on information compiled by Mr. Alfred Gillman of Odessa Resources Pty. Ltd., who is a fellow of the Australasian Institute of Mining and Metallurgy. Mr. Gillman is a consultant to Ariana Resources plc and has sufficient experience relevant to the styles of mineralisation and type of deposit under consideration and to the subject matter of the report to qualify as Competent Person and defined in the 2012 edition of the Australasian Code for the Reporting of Exploration Results Mineral Resources and Ore Reserves (JORC Code). Mr. Gillman consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
About Ariana Resources
Ariana is an exploration and development company focused on epithermal gold-silver and porphyry copper-gold deposits in Turkey. The Company is developing a portfolio of prospective licences selected on the basis of its in-house geological and remote-sensing database, on its own in western Turkey and in Joint Venture with Eldorado Gold Corporation in north-eastern Turkey. Eldorado owns 51% of this joint venture and are fully funding all exploration work on the JV properties, while Ariana owns 49%. The total resource inventory within this JV is 1.09 million ounces of gold.
The Company's flagship assets are its Kiziltepe and Tavsan gold projects which form the Red Rabbit Gold Project. Both contain a series of prospects, within two prolific mineralised districts in the Western Anatolian Volcanic and Extensional (WAVE) Province in western Turkey. This Province hosts the largest operating gold mines in Turkey and remains highly prospective for new porphyry and epithermal deposits. These core projects, which are separated by a distance of 75km, are presently being assessed as to their economic merits and now form part of a Joint Venture with Proccea Construction Co. The total resource inventory at the Red Rabbit Project stands at 475,000 ounces of gold equivalent.
Beaufort Securities Limited and Loeb Aron & Company Ltd. are joint brokers to the Company and Beaumont Cornish Limited is the Company's Nominated Adviser.
For further information on Ariana you are invited to visit the Company's website at www.arianaresources.com.
Glossary of Technical Terms:
"Ag" the chemical symbol for silver;
"Au" the chemical symbol for gold;
"cut-off grade" The lowest grade, or quality, of mineralised material that qualifies as economically mineable and available in a given deposit. May be defined on the basis of economic evaluation, or on physical or chemical attributes that define an acceptable product specification;
"g/t" grams per tonne;
"Indicated resource" a part of a mineral resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed;
"Inferred resource" a part of a mineral resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and has assumed, but not verified, geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that may be limited or of uncertain quality and reliability;
"Inverse Distance Squared" a conventional mathematical method used to calculate mineral resources. Near sample points provide a greater weighting than samples further away for any given resource block;
"JORC" the Joint Ore Reserves Committee;
"JORC 2004" is the previous edition of the JORC Code, which was published in 2004. It has been superseded by JORC 2012;
"JORC 2012" is the current edition of the JORC Code, which was published in 2012. After a transition period, the 2012 Edition came into mandatory operation in Australasia from 1 December 2013;
"m" Metres;
"oz" Ounces;
"t" Tonnes;
"Whittle" computer software that uses the Lerch-Grossman algorithm, which is a 3-D algorithm that can be applied to the optimisation of open-pit mine designs. The purpose of optimisation is to produce the most cost effective and most profitable open-pit design from a resource block model.
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