2023 Production Guidance

RNS Number : 9713S

Ariana Resources PLC

15 March 2023

 

15 March 2023

AIM: AAU

2023 PRODUCTION GUIDANCE

Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed mineral exploration and development company with gold mining interests in Europe, is pleased to announce the production guidance for 2023 for its interests in the Kiziltepe Mine ("Kiziltepe" or "the Project"). Kiziltepe is 23.5% owned by Ariana through its shareholding in Zenit Madencilik San. ve Tic. A.S.

Highlights:

· Gold production guidance for 2023 from Kiziltepe is expected to be c. 18,000 ounces of gold*, more than twice the production levels estimated in the feasibility plan for this approximate stage of mine life.

· Average monthly production is expected at approximately 29,000 tonnes of ore, with a stockpile of approximately 120,000 tonnes currently maintained on site.

· Ore throughput to the mill during 2023 is expected to be c. 350,000 tonnes.

·   Average grade of gold to be mined during the year is expected to be c. 1.7 g/t Au and gold recovery is expected to exceed 90%.

· Open-pit mining will continue largely at the Arzu North, Derya and Banu pits during 2023. 

· Extensive near-mine exploration remains underway.

Dr. Kerim Sener, Managing Director, commented:

"Production from the Kiziltepe Mine in 2022 reached all-time highs in terms of gold ounces produced (28,421 ounces gold) and in revenue (US$58 million), marking the most successful period of mining ever and the sixth year of guidance-beating output.  This followed on from the timely financing and the introduction of the processing plant expansion which was completed in 2021.  This has enabled a marked increase in throughput, to about 440,000 tonnes per annum in 2022.

It is notable that Kiziltepe has now produced 50% more gold over its life than projected in our Feasibility Study and has done so within only three-quarters of the time.  This is an extraordinary success and all credit is due to our operational team at Zenit and our exploration team's efforts, who have doubled our resources since the commencement of mining in 2017.  With the expected incremental growth of our resources following further drilling, we plan on maintaining production until the mid-2020s.  Furthermore, recent exploration successes have highlighted the potential to make further discoveries in the area, such as beneath Kiziltepe Hill at Kepez Main, albeit they represent deeper targets.

Kiziltepe will be operated in 2023 at a somewhat reduced rate, processing typically lower-grade ore and at a slightly reduced mill throughput, according to the current mine plan.  We are also enabling the exploration team to fully assess the targets identified in recent geophysics and to determine the drilling required to test these new opportunities adequately. 

While Kiziltepe represents our oldest project, we are encouraged that even 18 years since we purchased it from Newmont, it still yields significant exploration upside.  We have successfully demonstrated the progression of a project from the greenfields stage with just under 4,000m of drilling when purchased in 2005, to one with over 55,000m of drilling, delineating a Global Resource of 380,000 ounces of gold and over 6 million ounces of silver, of which perhaps half may be mined economically at this time."

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").

* Silver production guidance is not provided, as silver is treated as a by-product credit. All figures are stated gross to the Project unless otherwise stated.

Summary of Project

The Kiziltepe gold-silver mine was expected to deliver up to 20,000 oz gold per annum over eight years of initial mine life from 2017 to 2024.  Expansion of the Global Reserves to 175,000 ounces of gold enables the mine life to be extended further.  The operating company, Zenit Madencilik San. ve Tic. A.S., is a partnership between Ariana (23.5%), Proccea (23.5%) and Ozaltin (53%), with management control being with Proccea.  The commercial production was initiated at Kiziltepe during July 2017 and has continued without interruption, with production consistently being delivered above plan.  Kiziltepe has now produced approximately 50% more gold than expected from its total life of mine plan and has done so in three-quarters of the projected time.

The latest Resource and Reserve estimate for Kiziltepe was based on recent drilling and geological interpretation in February 2022.  Detailed technical and economic assessments are underway on several satellite vein systems not currently in the mining plan, in anticipation of these being developed in future years.  The Kiziltepe operation is currently targeting a minimum ten-year mine life, which will require the addition of a further 25,000 oz gold in Reserves outside of the five main pits (Arzu South, Arzu North, Banu, Derya and Kepez) that are currently scheduled to be mined.  The joint venture is confident that this can be achieved assuming the conversion of existing Resources to Reserves and parts of the Exploration Target being converted as well.

Contacts:

Ariana Resources plc	Tel: [phone]
Michael de Villiers, Chairman
Kerim Sener, Managing Director
Beaumont Cornish Limited	Tel: [phone]
Roland Cornish / Felicity Geidt
Panmure Gordon (UK) Limited	Tel: [phone]
John Prior / Hugh Rich / Atholl Tweedie
Yellow Jersey PR Limited	Tel: [phone]
Dom Barretto / Shivantha Thambirajah / Bessie Elliot	[e-mail]

Editors' Note:

The information in this announcement that relates to exploration results is based on information compiled by Dr. Kerim Sener BSc (Hons), MSc, PhD, Managing Director of Ariana Resources plc. 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 with an exceptional track-record of creating value for its shareholders through its interests in active mining projects and investments in exploration companies. Its current interests include gold production in Turkey and copper-gold exploration and development projects in Cyprus and Kosovo.

The Company holds 23.5% interest in Zenit Madencilik San. ve Tic. A.S. a joint venture with Ozaltin Holding A.S. and Proccea Construction Co. in Turkey which contains a depleted total of c. 2.1 million ounces of gold and other metals (as at February 2022). The joint venture comprises the Kiziltepe Mine and the Tavsan and Salinbas projects.

The Kiziltepe Gold-Silver Mine is located in western Turkey and contains a depleted JORC Measured, Indicated and Inferred Resource of 222,000 ounces gold and 3.8 million ounces silver (as at February 2022). The mine has been in profitable production since 2017 and is expected to produce at a rate of c.20,000 ounces of gold per annum to at least the mid-2020s. A Net Smelter Return ("NSR") royalty of 2.5% on production is being paid to Franco-Nevada Corporation.

The Tavsan Gold Mine is located in western Turkey and contains a JORC Measured, Indicated and Inferred Resource of 307,000 ounces gold and 1.1 million million ounces silver (as at November 2022). Following the approval of its Environmental Impact Assessment and associated permitting, Tavsan is being developed as the second gold mining operation in Turkey.  Construction progress is temporarily suspended pending the outcome of a local court decision pertaining to the EIA.  A NSR royalty of up to 2% on future production is payable to Sandstorm Gold.

The Salinbas Gold Project is located in north-eastern Turkey and contains a JORC Measured, Indicated and Inferred Resource of 1.5 million ounces of gold (as at July 2020). It is located within the multi-million ounce Artvin Goldfield, which contains the "Hot Gold Corridor" comprising several significant gold- copper projects including the 4 million ounce Hot Maden project, which lies 16km to the south of Salinbas. A NSR royalty of up to 2% on future production is payable to Eldorado Gold Corporation.

Ariana owns 100% of Australia-registered Asgard Metals Fund ("Asgard"), as part of the Company's proprietary Project Catalyst Strategy. The Fund is focused on investments in high-value potential, discovery-stage mineral exploration companies located across the Eastern Hemisphere and within easy reach of Ariana's operational hubs in Australia, Turkey and the UK.

Ariana owns 75% of UK-registered Western Tethyan Resources Ltd ("WTR"), which operates across south-eastern Europe and is based in Pristina, Republic of Kosovo. The company is targeting its exploration on major copper-gold deposits across the porphyry-epithermal transition.  WTR is being funded through a five-year Alliance Agreement with Newmont Corporation ( www.newmont.com ).

Ariana owns 50% (increasing to 58%) of UK-registered Venus Minerals Ltd ("Venus") which is focused on the exploration and development of copper-gold assets in Cyprus which contain a combined JORC Indicated and Inferred Resource of 17Mt @ 0.45% to 1.10% copper (excluding additional gold, silver and zinc.

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:

"Au" chemical symbol for gold;

"g/t" grams per tonne;

"JORC" the Joint Ore Reserves Committee;

"oz" Troy ounces;

Ends.

 

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