Ariana Resources PLC (LON: AAU)

(Image source: https://arianaresources.com/)

Overview

Ariana Resources is a mining company with its operations based in Turkey. The AIM-listed gold-silver exploration and development giant has a proven track record of expansion exploration.

The Red Rabbit Gold Project is Ariana’s joint venture with Proccea Construction that focuses on gold-silver production based at their Kiziltepe Mine. Its expansion strategy focuses on utilising current cash-flow to develop profitable gold mines. Currently, the Salinbas Gold Project is located in the north-eastern Turkey, within the Hot Gold Corridor has a production capability of 1 million ounce .

Besides gold exploration and production, Ariana is also into the renewable-energy which it operates through its Australian subsidiary, Asgard Metals.

Key Highlights

Ariana’s mines are located within the Tethyan Metallogenic Belt that has the world's largest gold, copper and silver deposits. The company is also constantly exploring the other mineral project opportunities in Turkey and also in the other parts of the globe.

Ariana has a strong team that is skilled with commercial, technical and financial capabilities.

It partners with businesses for the gold projects to ensure that its operation procedures are safe and has minimum environmental impact.

Projects

Red Rabbit Project

Located in western Turkey, the project is a joint venture with Proccea Construction Co. where Ariana has the 100% owned exploration licences around this project area.

The Kizilcukur project is the future of the Red Rabbit JV as it is within the drivable distance to the Kiziltepe mine.It achieved the first gold production at the Kiziltepe Sector in March 2017. This environmentally-friendly mine targets to produce 20,000 oz gold annually.

Kiziltepe Mine

The Kiziltepe Mine has all the infrastructural support for the project, including the open pits of Arzu North, Arzu South, Derya and Banu since it came into operation in July 2017 and had been a source of positive cashflow since the onset.

Stage of Development:

The Mine life of Kiziltepe Mine is 6 yrs remaining with an average Cash Costs per oz FY2018 was US$415/oz. The processing type is CIL/CIC and is designed for production rate of 20,000 oz Au pa.

The JORC Resource is 365,000oz with a target of 500,000oz and the JORC Reserve is1.1M tonnes for 140,000oz Au eq.

Tavsan

This Project is divided into five mineralised zones- Main, West, East, North and Far North. With capability to deliver 30,000 oz of gold per annum through heap-leach operation.

After the scoping-level assessment in 2016, it will be on JV’s global mining schedule in future, with significant growth in production from 20,000 oz pa to 50,000.

Tavsan mine life is 4 years with a target of 8 years with a cash cost of US$630/oz.

The processing plan is heap leach with planned production rate of 30,000oz Au pa.

The JORC Resource is 178,000 oz with a target of 300,000oz and the JORC Reserve: is subject to feasibility.

Kepez & Karakavak

Kepez and Karakavak are potential mines that are 12km and 27km away from the Kiziltepe processing plant and a highest potential area of near-surface resource growth in Kiziltepe.

With a potential of 27,000oz Au. eq. The area can further scope with future exploration with the development of several satellite open-pits in the future. There is capacity of near-surface mineralised veins at Karakavak with future potential.

Salinbas

This high potential gold-silver & base metal has over 1Moz defined and indicatest to have great mineralised systems on which the future growth of Ariana depends.

The three licenced areas under the project are Salinbas, Ardala and Hizarliyayla, a part of Artvin Goldfield. This Hot Gold Corridor is a location for significant gold-copper projects namely, 4Moz Hot Maden project (16km from Salinbasand 7km fromHizarliyayla).

The Ardala has a potential for coincident gold and silver which is not completely drill-tested.

The Mine Life is 10 years with Cash Costs of US$770/oz. The Processing is CIL and planned production rate is 50,000 oz Au pa. The JORC Resource is 650,000oz with a target of 1Moz. The JORC Exploration Target is 1.4 - 2.7M oz Au

Ivrindi Project

Located in the Ivrindi District of Balikesir Province in western Turkey, the project was discovered with remote-sensing technology. The prospect license was acquired in early 2004, under a single licence for 10 years operation. The Project area is 70km from Kiziltepe plant.

The JORC resource is 11,000 oz AU with management target of 25,000 oz AU.

Kizilcukur Project

The location of the project is 22km from Kiziltepe Mine and in the future will be the place for transportation and processing sight of ore. The company owns 10 years license and can be further bought into the Red Rabbit JV at higher exploration cost if there is a significant mutual benefit.

There is a future potential for open-pit mining and new drilling opportunities and  Metallurgical test has demonstrated that the ore can be processed well within Kiziltepe plant.

The trial resulted in 5,000 tonnes in 2017 and in future the material will be transported to the Kiziltepe plant

The mine life is 2 years with cash cost still under review. The processing will be CIL with a planned production rate of 10,000 oz Au pa. The JORC Resource is 33,000oz (Inferred) with a target of 50,000oz. The JORC Reserve is subject to feasibility.

Investments

Asgard Metals

Asgard owned by Ariana’s Australian subsidiary focuses on technology-commodity opportunities. The key target is renewable-energy applications: antimony and lithium, which are the future of resources.

Asgard has sold its interest in two ASX-listed companies- Dakota Minerals Ltd and Kingston Resources Ltd, net A$3.5 millions.

It also undertaken the Memorandum of Understanding with Metal Tiger plc in 2016 to discover lithium-tantalum opportunities in the Malay Peninsula.

Venus Minerals

Located in Cyprus it develops Volcanogenic Massive Sulphide (VMS) copper–gold in south-eastern Europe. It was acquired by Ariana through an earn-in agreement in Q4 2019.