INCREASE IN JORC RESOURCES AT THE MAGELLAN PROJECT

 

PDF version: http://www.rns-pdf.londonstockexchange.com/rns/6752H_1-2020-12-6.pdf

 

 

 

 

7 December 2020

AIM: AAU

 

INCREASE IN JORC RESOURCES AT THE MAGELLAN PROJECT, CYPRUS

 

Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed exploration and development company operating in Europe, is pleased to announce additional resources estimated in accordance with the JORC 2012 Code for the Magellan Project ("Magellan" or "the Project"), which is 100% owned by Venus Minerals Ltd ("Venus")*.  Venus is focused on the exploration and development of copper and gold assets in Cyprus.  Ariana is currently earning in to 50% of Venus.

 

Highlights:

 

·    New Sha Sector JORC Mineral Resource Estimate of 1Mt @ 0.80% Cu + 0.3% Zn (Inferred), including a higher-grade zone of 0.5Mt @ 1.13% Cu + 0.3% Zn (Inferred); potential for additional resources to be defined due to lack of modern exploration within the immediate area.

 

·    Significant potential for gold and silver rich zones to be defined within the resource at the New Sha Sector, with a JORC Exploration Target of 0.5Mt to 1.5Mt for 6,500oz to 41,000oz gold at an average grade of 0.40 g/t Au to 0.85 g/t Au.

 

·    Revised JORC Mineral Resource Estimate (stated gross) of 9.5Mt @ 0.65% Cu^# (Inferred), with additional potential for gold, silver and zinc-rich zones (up to 0.6% Zn) across the Klirou, Kokkinoyia and New Sha sectors of the Magellan Project.

 

·    New exploration drill-hole planning currently underway to test several target areas within the prospective area.

 

Dr. Kerim Sener, Managing Director of Ariana Resources, commented:

 

"The completion of this updated Mineral Resource Estimate for the Magellan Project represents another important step forward for Venus Minerals.  A combined resource of 9.5Mt @ 0.65% Cu with significant additional potential for precious-metals and zinc is very much closing in on our initial target of >10Mt @ 0.6% Cu, 0.6% Zn, 0.5 g/t Au and 6 g/t Ag for the Project.  Additional exploration and resource drilling in the vicinity of these resource areas is likely to yield further growth of the Magellan resource, and drill planning is being undertaken accordingly.

 

"Outside of these resource areas, the Venus exploration team have been focused on delivering an initial percussion drilling programme on several new exploration targets identified across its portfolio.  These targets have been developed based on a revised geological model and related geological concepts, the results of which will be integrated in to the drill planning for the Magellan area.  We look forward to providing further updates on this exploration in due course." 

 

* Further information about Venus Minerals and its projects is available on the Company's website, www.venusminerals.co.

 

^# Resources are quoted gross with respect to the Venus Minerals Ltd earn-in. 

 

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

 

Introduction

 

Following the completion of the Mineral Resource Estimate for the Kokkinoyia and Klirou deposits (see announcement 15 October 2020), the Ariana and Venus exploration teams are pleased to report the completion of a Mineral Resource Estimate for the New Sha Sector in accordance with JORC 2012.  New Sha is the third deposit currently comprising the Magellan Project area (Figure 1).

 

Copper, gold, silver and zinc mineralisation at the Magellan Project is associated with Volcanogenic Massive Sulphide (VMS) deposition at or near the palaeo-seafloor.  The mineralisation contains localised lenses of massive metal sulphides (dominantly pyrite, chalcopyrite and sphalerite) which are surrounded by pervasive chloritic alteration and sulphide dissemination in the volcanic host rocks.  The mineralisation is partly structurally controlled, associated with N-S trending horst- and graben-bounding normal faults.  Mineralisation is stratigraphically located near, or at the contact between, two gently NNE-dipping (10-20˚) pillow basalt sequences; the Upper Pillow Lavas (UPL) and Lower Pillow Lavas (LPL), of Upper Cretaceous age (90 Ma to 80 Ma) in the Troodos Ophiolite.

 

Despite subtle variations in their structural and stratigraphic settings, the nature of mineralisation at Kokkinoyia, Klirou and New Sha is broadly similar, comprising massive sulphide lenses, zones of disseminated sulphides, and associated stockworks.  Each deposit contains significant amounts of copper, zinc, gold and silver, although the ratios of these elements vary locally.  Recent advances in understanding how these deposits form suggest all three Sectors have scope for expansion, and drilling programs are currently being planned.

 

 

 

 

Figure 1: Location of the New Sha, Klirou, Kokkinoyia Sectors of the Magellan Project, showing the corresponding licences, main access roads and the location of the old processing facility at Mitsero.  The New Sha Sector is located in the southeastern part of the Magellan Project.

 

Resource Estimation

 

The New Sha Sector Resource Estimate is based on a detailed review of all available drill data acquired from the late 1960s.  This data comprises 110 open-hole percussion drill holes for a total of 12,274.14 meters of drilling.  The use of modern software with improved estimation methods and statistical analysis enables the calculation of a Resource Estimate sufficient to be classified as Inferred.  However, the data density for the Project is generally appropriate to support higher categories of classified resources in some areas, but this will require more confirmatory drilling to increase confidence in the historic data.  JORC Table 1 for New Sha provides more detail on sampling techniques and data used in this estimation.

 

Estimation Methodology

 

Ariana completed the geological modelling of the mineralised zones within the New Sha deposit in Leapfrog Geo 5.0.4 (see JORC Table 1, Appendix 1 and 2).  Three mineralisation domains were modelled from sectional interpretations and associated interpolation, representing the most current geological data and understanding.  The New Sha Resource Estimate is separated into two main areas: 1) New Sha East, and 2) New Sha West.

 

New Sha East contains the bulk (89%) of defined mineralisation within the estimation and is entirely contained within 50-170m below surface.  The mineralisation in this area has also been separated into two sample populations (low-grade and high-grade) for better statistical analysis.

 

New Sha West comprises the remaining 11% of defined mineralisation and is mostly lower-grade and disseminated in nature.  A single interpolant domain was used to define the extents of the mineralisation from surface to an approximate depth of 60m below surface.  New Sha East is separated from New Sha West by a probable N-S trending normal fault, creating a gap in the known mineralisation of approximately 400m in a NE-SW direction (Figure 2). 

 

Interpolation and wireframe modelling of the mineralised zones in Leapfrog EDGE was completed using a 0.1% Cu modelling cut-off grade (CoG).  Higher-grade mineralisation lenses were modelled separately and domained individually and used a 0.5% Cu modelling CoG.  The models were created based upon interval selections that referenced the copper grades, lithological descriptions and structural interpretation, where appropriate.  Where continuity was not established between sections, the strike extrapolation was limited both manually (wireframes) and statistically (interpolations).  The continuity of the various structures is reflected in the Mineral Resource classification.

 

Specific gravity was determined by the use of a regional statistical study of Cypriot VMS systems, detailing the variation of density with increasing sulphur content.  Density values were applied to each block within the various block models according to its attributed average sulphur value.  Density values ranged from 2.3 g/cm³ where sulphur is <5%, through to 3.9 g/cm³ where sulphur is >40%.

 

Compositing was completed in Leapfrog EDGE using a 1m best fit routine.  A hard domain boundary was applied to each modelled mineralisation domain, which forced all samples to be included in one of the composites by adjusting the composite length, while keeping it as close as possible to the selected intervals of 1m.  General mineralisation trends and continuity was identified within Leapfrog Geo by use of trend planes and their associated attributes, and as such, it was not necessary to complete variography analysis within the small area of mineralisation at New Sha. 

 

Top-cut analysis was completed by viewing in three-dimensions the composite distributions according to grade within the models.  Generally, high-grade samples showed a regular continuity in direction and location.  These were accordingly modelled as individual high-grade domains.  Once appropriately domained, the New Sha dataset generally did not have undue bias at higher-grades and therefore no top-cut was applied.

 

A non-rotated sub-block model was established at New Sha.  Block sizes were determined by drill spacing within the dataset and wireframe geometry.  The optimal parent block sizes used within the block-model was 10m x 10m x 10m (x, y, z), sub-blocked to 5m x 5m x 5m (x, y, z).  Sub-blocks received parent block grades during estimation and grades were estimated using Inverse Distance Weighted Squared, adopting a multi-pass methodology. 

 

In addition to copper and sulphur analyses, the New Sha dataset also contains partial analytical results for zinc (56.3% of total data).  These samples are all contained within the New Sha East area, and provide sufficient information to incorporate within the resource estimation.  

 

 

 

Figure 2: Geological model of the New Sha deposit in plan and section, showing historic drilling.  The location of a probable normal fault is shown in the section.

 

Resource Classification

 

The Mineral Resource Estimate is classified according to the guidelines presented within the 2012 JORC Code (JORC Table 1) as Inferred only (Table 1 and 2).  The New Sha Sector has sufficient subsurface geological and geochemical data for higher classified resource categories to be achieved.  However, this is limited by the historic nature of the drilling database and this data cannot be audited, as no reference samples have been archived.

 

The styles of mineralisation have been identified, the controls on mineralisation are sufficiently understood and measurements and sampling completed to a reasonable degree of confidence for the mineralisation present.  It is considered reasonable to expect that some of the Inferred resources could be upgraded to the Indicated category with continued exploration; however, due to the uncertainty of Inferred it should not be assumed that such upgrading will always occur.  It is also reasonable to expect that portions of the Indicated, when defined, could be further upgraded to Measured with additional infill data.

 

The Resource Estimate for the Project uses a reporting cut-off of 0.3% Cu for low-grade domains and 0.5% Cu for higher-grade domains and demonstrates that there are reasonable prospects for eventual economic extraction (Table 1 and 2).  Confidence in the Resource Estimate is sufficient to allow the results to be used in further technical and economic studies.  Additional confidence in the data obtained from historic drilling is required in order to advance further understanding of the Project and this is likely to be achieved following a confirmatory diamond drilling programme.

 

Table 1: Summary of 2020 New Sha Mineral Resource Estimate, in accordance with JORC 2012, based on 110 drill holes across the New Sha Sector (dated 4 December 2020).  Reporting is based on 0.3% (lower-grade) and 0.5% Cu (higher-grade domains) cut-off grades. Figures in the table may not sum precisely due to rounding. These figures are quoted gross with respect to the New Sha Sector of the Magellan Project. *Zinc resources are defined from existing data for New Sha East only. Numbers in the table may not sum due to rounding.

 

			Average Grade			Metal Content
Mineralisation Domain	Density (g/cm³)	Tonnes (t)	Cu (%)	S (%)	Zn (%)	Cu (t)	S (t)	Zn (t)
New Sha East High Grade	3.06	500,000	1.1	27.8	0.3	6,000	140,000	1500
New Sha East Low Grade	2.77	400,000	0.4	19.6	0.3	1,500	72,500	1000
New Sha West	2.72	100,000	0.6	18.3	n/a	500	18,000	n/a
Inferred Total	2.85	1,000,000	0.80	23.7	0.3	8,000	230,500	2,500

 

Table 2: Summary 2020 Magellan Project Mineral Resource Estimate, in accordance with JORC 2012, providing a detailed breakdown of the Project according to all deposit domains (dated 4 December 2020).  Reporting is based on a 0.2 % Cu, 0.3% Cu and 0.5% cut-off grades depending on the domain. Figures in the table may not sum precisely due to rounding. These figures are quoted gross with respect to the Magellan Project. *Zinc resources are currently only defined at Klirou and New Sha as the Kokkinoyia zinc dataset is insufficient to define a resource at this time.  Numbers in the table may not sum due to rounding.

 

					Average Grade			Metal Content
	Resource Domain	Volume	Density	Tonnes	Cu	S	Zn	Cu	S	Zn
		(m³)	(g/cm³)	(t)	(%)	(%)	(%)	(t)	(t)	(t)
Kokkinoyia	High Grade Block East	146,375	3.01	441,000	2.29	21.3	-	10,000	94,000	-
	High Grade Block West	113,625	2.97	338,000	1.17	17.35	-	4,000	59,000	-
	Low Grade Block East	662,125	2.75	1,822,000	0.59	12.31	-	11,000	224,000	-
	Low Grade Block West	1,011,000	2.57	2,601,000	0.42	9.84	-	11,000	256,000	-
	Sub Total	1,933,125	2.69	5,202,000	0.69	12.16	-	36,000	633,000	-
Klirou	Inferred KL Central	34,875	2.45	86,000	0.43	8.86	0.26	400	7,500	200
	Inferred KL East	775,750	2.66	2,060,000	0.63	16.19	0.74	13,000	333,500	15,000
	Inferred KL West	469,625	2.46	1,153,000	0.38	9.18	0.38	4,000	106,000	4,500
	Sub Total	1,280,250	2.58	3,299,000	0.54	13.55	0.6	17,400	447,000	19,700
New Sha	New Sha East High Grade	164,808	3.06	500,000	1.1	27.8	0.3	6,000	140,000	1500
	New Sha East Low Grade	133,816	2.77	400,000	0.4	19.6	0.3	1,500	72,500	1000
	New Sha West	36,768	2.72	100,000	0.6	18.3		500	18,000
	Sub Total	335,392	2.85	1,000,000	0.80	23.7	0.3	8,000	230,500	2,500
	Inferred Total	3,548,767	2.71	9,501,000	0.65	13.79	0.23	61,400	1,310,500	22,200

 

 

 

Gold Potential: JORC Exploration Target

 

Historically gold was not assayed as a matter of course in Cyprus sulphide deposits.  At New Sha East, 257 samples were assayed for gold (approximately 9% of all New Sha data), the results of which clearly demonstrate that gold is present within the New Sha Sector.  The distribution of these samples is deemed spatially sufficient to support an Exploration Target in accordance with JORC 2012, as summarised in Table 3.  Key drilling intercepts supporting the target include:

 

·    8m @ 2.20 g/t Au: S104 from 121m to 129m

·    13m @ 1.0 g/t Au: S123 from 158m to 171m

·    15m @ 0.7 g/t Au: S88 from 66m to 81m

Table 3: Summary 2020 New Sha JORC Exploration Target for gold.  Numbers in the table may not sum due to rounding. 

Target Area	Tonnage (t)		Element	Grade (g/t)		Contained Metal Ounces
	From	To		From	To	From	To
New Sha East	500,000	1,500,000	Au	0.4	0.85	6,500	41,000

 

 

Contacts:

 

Ariana Resources plc	Tel: +44 (0) 20 7407 3616
Michael de Villiers, Chairman
Kerim Sener, Managing Director
Beaumont Cornish Limited	Tel: +44 (0) 20 7628 3396
Roland Cornish / Felicity Geidt
Panmure Gordon (UK) Limited	Tel: +44 (0) 20 7886 2500
John Prior / Hugh Rich / Atholl Tweedie
Yellow Jersey PR Limited	Tel: +44 (0) 7951 402 336
Dom Barretto / Joe Burgess / Henry Wilkinson	[email protected]

 

Editors' Note:

 

The Mineral Resource Estimate was prepared by Zack van Coller BSc (Hons), Special Projects Geologist, Ariana Resources plc. Mr. van Coller is a Competent Person as defined by the JORC Code, 2012 Edition. The results are reported in accordance with the JORC Code, under the direction of Dr. Kerim Sener BSc (Hons), MSc, PhD, Managing Director of Ariana Resources plc, and a Competent Person as defined by the JORC Code.  Mr. van Coller and Dr. Sener have reviewed the technical and scientific information in this press release relating to the Mineral Resource estimates and approve the use of the information contained herein.

 

The information in this announcement that relates to exploration results is based on information compiled by Dr. Kerim Sener BSc (Hons), MSc, PhD.  Dr. Sener is a Fellow of The Geological Society of London and a Member of The Institute of Materials, Minerals and Mining and has sufficient experience relevant to the styles of mineralisation and type of deposit under consideration and to the activity that has been undertaken to qualify as a Competent Person as defined by the 2012 edition of the Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code) and under the AIM Rules - Note for Mining and Oil & Gas Companies. Dr. Sener 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 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.

 

Glossary of Technical Terms:

 

"Ag" chemical symbol for silver;

 

"Au" chemical symbol for gold;

 

"Cu" chemical symbol for copper;

 

"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;

 

"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 Weighted Squared" or "IDWS" a conventional mathematical method used to calculate the attributes of 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 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;

 

"Mt" million tonnes;

 

"Ordinary Kriging" is a geostatistical approach to modelling which relies on the spatial correlation of the data to determine weighting values, rather than weighting nearby data points by some power of their inverted distance (e.g. IDWS).  This is a more rigorous approach to modelling, as the spatial correlation between data points determines the estimated value at an unsampled point;

 

"S" chemical symbol for sulphur;

 

"oz" Troy Ounces.  One Troy Ounce is equal to 31.1035 grams;

 

"VMS" Volcanogenic Massive Sulphide;

 

"Zn" chemical symbol for zinc.

 

 

Ends.