TIDMAAU
RNS Number : 8943F
Ariana Resources PLC
21 July 2021
http://www.rns-pdf.londonstockexchange.com/rns/8943F_1-2021-7-20.pdf
21 July 2021
AIM: AAU
SIGNIFICANT RESOURCE UPDATE: KEPEZ NORTH
c. 100% increase over previous resource estimate
Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed
mineral exploration and development company with joint-venture gold
mining operations in Europe, is pleased to announce a drilling and
resource update for the Kepez North ("Kepez" or "the Project") area
of the Kiziltepe Sector. Kepez North is part of the Zenit
Madencilik San. ve Tic. A.S. ("Zenit") Joint Venture ("JV") with
Proccea Construction Co. and Ozaltin Holding A.S. and is 23.5%
owned by Ariana.
Highlights:
-- Resource contains c. 36,400 ounces of gold and 329,400 ounces of silver.
-- 97% increase in contained gold ounces over previous resource
estimate (2020) and a 310% increase over the Feasibility Study
Resource (2013).
-- Significant positive increase in average grade to 7.14g/t Au + 64.65g/t Ag.
-- Substantially improved classification of the Resource to
approximately 86% Measured and 14% Indicated.
-- New pit optimisation study now complete and area is being
advanced through further permitting.
Dr. Kerim Sener, Managing Director, commented:
"This is a great outcome from the recent drilling undertaken in
the Kepez area. We remain highly encouraged by this area as a
potential source of very high-grade mineralisation, which can
complement the mill-feed of the Kiziltepe processing plant, which
is located only 14km away by road. Based on the significant
increase in the resource at Kepez and the potential for identifying
further extensions of this high-grade mineralisation down plunge,
the JV has taken the decision to bring the drill rig back to this
area to complete further drilling. This work, in addition to
further mining studies and associated permitting is being expedited
in order to bring this area forward in the mining schedule.
Importantly, the geometry of the mineralisation lends itself well
to near complete resource extraction."
* All Mineral Resource figures in the announcement are quoted
gross with respect to the Red Rabbit Joint Venture. Ariana owns
23.5% of the JV.
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").
Introduction
The Kepez North resource has been updated with the addition of
five new diamond drill holes, as announced 30 June 2021. This
infill drilling reduced the drill spacing to an average of 25m
within the primary resource area, to as little as 10m, increasing
confidence of the resource and its classification. Revised
optimisation work has also been completed, providing for a designed
pit which captures 81% of the total resource by volume and over 87%
of the resource by gold ounces. The Zenit mining team are in the
process of expediting mining activities at Kepez North. Additional
drilling is commencing to expand the vein and scree resources to
the south and southwest.
Kepez North
The Kepez North prospect is situated 14km haulage distance from
the Kiziltepe processing plant. The prospect contains 2.5km of
dominantly north-trending and bifurcating low-sulphidation style
vein outcrop over a series of ridges near the village of Kepez. The
Kepez North vein is approximately 600m long and up to 20m wide
(Figure 1). It is positioned at the contact between dacitic
pyroclastic and ophiolitic rocks and dips at 50(o) to the west. The
majority of the gold mineralisation in this vein occurs in a matrix
supported hydrothermal quartz breccia which occurs in a limited
zone of approximately 150m along strike. The mineralisation is
silver rich with some veins showing an Ag:Au ratio of between 4:1
and 8:1. The pyrite content is typically 1 to 5%. Mineralised scree
from old workings along the Kepez Main hanging wall (containing
average grades of approximately 7g/t Au + 65g/t Ag) has been
defined from previous sampling.
http://www.rns-pdf.londonstockexchange.com/rns/8943F_1-2021-7-20.pdf
Figure 1: Overview of the Kepez deposit, updated geological
model and 2021 optimisation pit outline.
Resource Estimation
The 2021 Kepez Mineral Resource Estimate (MRE) consists of: 1)
the addition of 306 drill core samples (incl. 46 QA/QC samples)
from the latest drilling of five holes; 2) an increase in
confidence in surface scree sampling, allowing a better resource
domain to be created; 3) the inclusion of surface rock-saw channel
sampling; and 4) a revised optimisation study.
Estimation Methodology
Ariana completed the geological modelling of the mineralised
zones in Leapfrog Geo 6.0 (see JORC Table 1, Appendix 1) for the
Kepez area as a whole. Several mineralised zones were modelled from
sectional interpretations and associated interpolation,
representing the most current geological and geochemical data and
understanding.
Interpolation and wireframe modelling of the mineralised zones
in Leapfrog EDGE was completed using a 0.2g/t Au modelling cut-off
grade (CoG). However, most of the vein domain within the immediate
resource area was defined using 1g/t Au intercept composites. 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.
Two domains were modelled; one for the main vein material and
one for the mineralised scree material up to 5m from the surface.
An average specific gravity value of 2.6g/cm(3) was used for both
vein and scree material.
Compositing was completed in Leapfrog EDGE using a 1m best fit
routine. Hard domain boundaries were applied to both deposit
models, 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.
A top-cut was not applied to the assay results or composites.
The maximum gold value is 20.31g/t Au, which is below the 30g/t Au
top-cut determined from statistical analysis of the Kiziltepe-Kepez
area as a whole. Despite silver showing significantly higher values
than in other areas of the Kiziltepe Gold Corridor, the values are
considered to be relevant values and did not warrant a top-cut.
Variography was assessed, however the sample population is too
small to obtain reasonable results for use in an Ordinary Kriging
estimation. The variable orientation (dynamic anisotropy) function
was used for estimation of grade into the vein domain whilst the
orientation of the scree at surface was used for estimation into
the scree domain. The grades were interpolated into the 2.5m x 2.5m
x 2.5m blocks by Inverse Distance Weighting Squared (ID2), adopting
a multi-pass methodology. The block model is a non-rotated
conventional block model with no sub-blocking used (Figure 2).
http://www.rns-pdf.londonstockexchange.com/rns/8943F_1-2021-7-20.pdf
Figure 2: Block model of the Kepez deposit in plan and
section.
Resource Classification
The Mineral Resource is classified in line with the guidelines
of the 2012 JORC Code (JORC Table 1) as Measured, Indicated and
Inferred (Table 1 and 2). The classification is determined based on
search pass spacing, with increasing confidence with proximity to
drill holes. The Measured and Indicated components occur mainly
within the limits of the designed open-pit.
Table 1: Summary 2021 Kepez North MRE (dated 13 July 2021), in
accordance with JORC 2012, based on 25 diamond drill holes and 22
rock-saw channels across the Kepez North deposit. The 20 RAB holes
drilled in 2009 were not included in the modelling and estimate as
they did not achieve their objective depth (target 30m, achieved
5m). Reporting is based on a 1g/t Au economic cut-off grade.
Figures in the table may not sum precisely due to rounding. Figures
include assessment of mineralised scree material. See Table 2 for
in-pit Mineral Resources.
Average Value Material Content
----------------------------------- ---------------- -------------------
Classification Volume Mass Au Ag Au Ag
m(3) t g/t g/t t. oz t. oz
---------------- ------- -------- ------- ------- -------- ---------
Measured 52,300 136,000 7.18 67.37 31,300 294,500
---------------- ------- -------- ------- ------- -------- ---------
Indicated 8,500 22,200 7.02 48.76 5,000 34,800
---------------- ------- -------- ------- ------- -------- ---------
Meas + Ind 60,800 158,200 7.15 64.76 36,400 329,400
---------------- ------- -------- ------- ------- -------- ---------
Inferred 100 300 1.08 2.19 10 20
------- -------- ------- ------- -------- ---------
Optimisation Study
The updated classified resource model was assessed internally by
the Zenit Team and an optimised pit shell was created for the
Measured and Indicated Resource, using an input price of US$1,735
per ounce gold (see JORC Table 1 for further details). The
optimisation found that the resource is not sensitive to changes to
the overall pit wall angle between 40-45(o) . At a pit wall angle
of 40(o) , the pit encompasses 128,300t @ 7.69g/t Au + 69.98g/t Ag,
totalling 31,700 oz Au.
The updated optimisation indicates a stripping ratio of 2.7. The
next stage of development will involve the establishment of a trial
pit to confirm the choice of pit wall angles and determine the best
method of grade control sampling to be used when mining begins.
Table 2: Summary table of in-pit Mineral Resources. Figures in
the table are rounded.
Average Value Material Content
------------------------------------------ ---------------- -------------------
Classification Volume Mass Au Ag Au Ag
(m(3)) (t) (g/t) (g/t) (oz) (oz)
---------------------- -------- -------- ------- ------- -------- ---------
Measured + Indicated 49,300 128,300 7.69 69.98 31,700 288,500
---------------------- -------- -------- ------- ------- -------- ---------
Sampling and Assaying Procedures
All diamond drill core is currently being processed at the
Kiziltepe mine site and analysed at the Kiziltepe Mine Laboratory.
Results are being assessed systematically and are being grouped
according to individual vein systems at the Kiziltepe Sector.
HQ size drill-core samples from the drilling programme at the
Kepez deposit were cut in half by a diamond saw and sent for
analysis in batches in line with the Company's quality control
procedures. For all the Kepez North drilling, a total of 306
samples (including 46 QA/QC samples) were submitted to the
Kiziltepe Mine Laboratory. Core recovery for all drilling conducted
at Kepez North during this campaign was 85%, for a total of 178
measurements.
All samples were assayed for gold using a 30g fire assay.
Reviews of the assay results have determined that all Quality
Control and Quality Assurance samples (blanks, standards and
duplicates) passed the quality control checks established by the
company, with duplicate samples showing excellent correlation.
Laboratory sample preparation, assaying procedures and chain of
custody are appropriately controlled. The Company maintains an
archive of half core samples and a photographic record of all cores
for future reference.
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 arianaresources@yellowjerseypr.com
Wilkinson
Editors' Note:
The Mineral Resource estimate was prepared by Ruth Bektas BSc
(Hons) CGeol EurGeol, Projects Analyst, Ariana Resources plc. Miss
Bektas is a Competent Person as defined by the JORC Code, 2012
Edition. The estimate was reviewed internally by Zack van Coller,
BSc (Hons), Special Projects Geologist, a Competent Person as
defined by the JORC Code. 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, 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 July 2020). 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 227,000 ounces gold and 0.7 million ounces silver (as at April
2020). 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 Project is located in western Turkey and
contains a JORC Measured, Indicated and Inferred Resource of
253,000 ounces gold and 3.7 million ounces silver (as at June
2020). The project is being progressed through permitting and an
Environmental Impact Assessment, with the intention of developing
the site to become the second joint venture gold mining operation.
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 is currently earning-in to 75% of Western Tethyan
Resources Ltd ("WTR"), which operates across 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.
Ariana is also earning-in to 50% of UK-registered Venus Minerals
Ltd ("Venus") and has to date earned into an entitlement to 37.5%.
Venus is focused on the exploration and development of copper-gold
assets in Cyprus which contain a combined JORC Inferred Resource of
9.5Mt @ 0.65% 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:
"Ag" chemical symbol for silver;
"Au" chemical symbol for gold;
"g/t" grams per tonne;
"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;
"oz" Troy ounces. One Troy Ounce is equal to 31.1035 grams;
"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;
"Inverse Distance Weighted Squared" 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;
"Measured resource" a part of a Mineral Resource for which
tonnage, densities, shape, physical characteristics, grade and
mineral content can be estimated with a high level of confidence.
It is based on detailed and reliable exploration, sampling and
testing information gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and
drillholes. The locations are spaced closely enough to confirm
geological and grade continuity;
"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.
Ends.
Appendix 1 - JORC Table 1
JORC Code, 2012 Edition - Table 1
Kepez North, Western Turkey
Section 1 Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria JORC Code explanation Commentary
Sampling
techniques * Nature and quality of sampling (e.g. cut channels, * Full core was split using a diamond rock-saw, and
random chips, or specific specialised industry half-core samples were taken at variable intervals.
standard measurement tools appropriate to the Core recovery was recorded into the database.
minerals under investigation, such as down hole gamma
sondes, or handheld XRF instruments, etc). These
examples should not be taken as limiting the broad * Portable XRF (pXRF) was used to obtain more data in
meaning of sampling. support of the sampling. pXRF certified reference
standards were used on a regular basis in line with
company procedures.
* Include reference to measures taken to ensure sample
representivity and the appropriate calibration of any
measurement tools or systems used.
* Aspects of the determination of mineralisation that
are Material to the Public Report.
* In cases where 'industry standard' work has been done
this would be relatively simple (e.g. 'reverse
circulation drilling was used to obtain 1 m samples
from which 3 kg was pulverised to produce a 30 g
charge for fire assay'). In other cases more
explanation may be required, such as where there is
coarse gold that has inherent sampling problems.
Unusual commodities or mineralisation types (e.g.
submarine nodules) may warrant disclosure of detailed
information.
Drilling
techniques * Drill type (e.g. core, reverse circulation, open-hole * The majority of the drilling is inclined (only 7
hammer, rotary air blast, auger, Bangka, sonic, etc) vertical holes).
and details (e.g. core diameter, triple or standard
tube, depth of diamond tails, face-sampling bit or
other type, whether core is oriented and if so, by * Core is not oriented.
what method, etc).
* Historic drilling (1992) was undertaken by HQ diamond
drilling (440.3 m).
* 2006 drilling was undertaken by HQ diamond drilling
(857.2 m).
* 2009 drilling was undertaken by blast hole RAB
drilling (100.0 m).
* 2021 drilling was undertaken by HQ diamond drilling
(300.2 m).
* Rock-saw channel sampling was completed in 2020
(157.5 m).
Drill sample
recovery * Method of recording and assessing core and chip * Recovery data for the 1992 drilling is not available.
sample recoveries and results assessed.
* From 2006 onwards recoveries were monitored and
* Measures taken to maximise sample recovery and ensure recorded into the sampling database. Drill recoveries
representative nature of the samples. for all mineralised intercepts exceeded 90% recovery.
* Whether a relationship exists between sample recovery * There is no bias between sample recovery and grade.
and grade and whether sample bias may have occurred
due to preferential loss/gain of fine/coarse
material.
Logging
* Whether core and chip samples have been geologically * All diamond core holes were logged lithologically
and geotechnically logged to a level of detail to using a coded logging system for rock type, grain
support appropriate Mineral Resource estimation, size, colour, alteration and any other relevant
mining studies and metallurgical studies. observations.
* Whether logging is qualitative or quantitative in * Mineralised zones were identified from observation of
nature. Core (or costean, channel, etc) photography. mineralogy and lithological characteristics. pXRF
analysis of recent drill core was conducted post
drilling, to provide supporting geochemical data for
* The total length and percentage of the relevant non-sampled regions. Areas identified as
intersections logged. geochemically anomalous by pXRF were further sampled.
The pXRF was checked by use of certified referenced
standards to ensure good quality data was produced.
* All drilled metres [25 diamond drill holes (1,597.7
m), 20 RAB drill holes (100 m) and 22 rock-saw
channels (157.5 m)] were logged regardless of
presence of mineralisation.
Sub-sampling
techniques * If core, whether cut or sawn and whether quarter, * Samples from diamond drill core were collected from
and sample half or all core taken. sawn halves of identified zones of interest. Half
preparation core remains in the core tray for reference.
* If non-core, whether riffled, tube sampled, rotary
split, etc and whether sampled wet or dry. * Sample preparation technique is appropriate to the
mineralisation style.
* For all sample types, the nature, quality and
appropriateness of the sample preparation technique. * Splitting and sample preparation conducted on samples
at the ALS laboratory:
* Quality control procedures adopted for all
sub-sampling stages to maximise representivity of
samples.
* Measures taken to ensure that the sampling is
representative of the in situ material collected,
including for instance results for field
duplicate/second-half sampling.
* Whether sample sizes are appropriate to the grain
size of the material being sampled.
Quality of
assay data * The nature, quality and appropriateness of the * QC procedures employed in all drill programmes prior
and assaying and laboratory procedures used and whether to 2019 included the insertion of certified reference
laboratory the technique is considered partial or total. standards (1:22), blank samples (1:22), pulp and
tests crush duplicates (2:22) to monitor the accuracy and
precision of laboratory data when samples were
* For geophysical tools, spectrometers, handheld XRF submitted to ALS Global, Izmir. Insertion rate of
instruments, etc, the parameters used in determining 18%.
the analysis including instrument make and model,
reading times, calibrations factors applied and their
derivation, etc. * In drill programmes since 2019, samples have been
submitted in batches of 35 to ALS Global, Izmir, to
include 1 blank, 1 CRM, 1 field duplicate and 1 pulp
* Nature of quality control procedures adopted (e.g. duplicate. Insertion rate of 11%.
standards, blanks, duplicates, external laboratory
checks) and whether acceptable levels of accuracy
(i.e. lack of bias) and precision have been
established. * Samples submitted to Zenit Laboratory are in batches
of 20 to include 1 blank, 1 CRM, 1 field duplicate
and 1 internal Zenit Lab sample. Insertion rate of
16%.
* The overall quality of QA/QC procedures is considered
adequate to ensure the validity of the data used for
resource estimation purposes.
* The pXRF is an Olympus Vanta. A series of 10 blank
and certified reference material samples are used to
check the quality of the pXRF data. These are scanned
at a rate of 1 blank and 1 CRM for every 100 samples.
The device does not require further calibration.
Verification
of sampling * The verification of significant intersections by * All samples between 2006 and 2019 were submitted to
and assaying either independent or alternative company personnel. the internationally accredited laboratory of ALS
Global in Izmir, Turkey (ISO 9001:2008 accredited).
* The use of twinned holes.
* Samples taken in 2019, 2020 and 2021 have been
submitted to Zenit Laboratory at the Kiziltepe Mine,
* Documentation of primary data, data entry procedures, with 10% also selected for check assays at ALS Global
data verification, data storage (physical and in Izmir throughout the sampling programme. Samples
electronic) protocols. are chosen from areas suspected to be mineralised.
* Discuss any adjustment to assay data. * Primary data, data entry procedures, data
verification and data storage protocols are in line
with industry best-practice.
* Assay data has not been adjusted.
Location of
data points * Accuracy and quality of surveys used to locate drill * All collar positions were located initially by
holes (collar and down-hole surveys), trenches, mine hand-held GPS (Garmin Etrex 10 and 30) and later
workings and other locations used in Mineral Resource surveyed by a professional surveyor using dGPS
estimation. equipment.
* Specification of the grid system used. * 2021 drill holes were surveyed using a standard
Electronic Multi-shot Magnetic survey deviation tool
(Devico PeeWee). All holes were surveyed in the 2021
* Quality and adequacy of topographic control. drilling programme.
* All coordinates are collected by dGPS, converted to
the local grid and recorded in UTM ED50 35N.
* Topographic data is collected by dGPS.
Data spacing
and * Data spacing for reporting of Exploration Results. * Drill section spacing close to the vein outcrop is
distribution typically 10 to 12.5 m, with average spacing of 25m
across the Kepez North prospect as a whole.
* Whether the data spacing and distribution is
sufficient to establish the degree of geological and
grade continuity appropriate for the Mineral Resource * 25 diamond drill holes (1,597.7m) and 22 rock-saw
and Ore Reserve estimation procedure(s) and channels (157.5 m) were used to model the vein
classifications applied. systems and scree material. The 20 RAB drill holes
(100 m) were excluded from the modelling and
estimation as they did not achieve their drilling
* Whether sample compositing has been applied. objective (30m planned depth, 5m depth achieved).
* Sample compositing has not been applied at the
sampling stage.
* Sample spacing and distribution is sufficient to
establish the geological and grade continuity
required for modelling and resource estimation.
Orientation
of data in * Whether the orientation of sampling achieves unbiased * The dip of the mineralisation for most of the deposit
relation to sampling of possible structures and the extent to is 50deg to the west.
geological which this is known, considering the deposit type.
structure
* Local grade continuity follows the dip of the
* If the relationship between the drilling orientation mineralisation for the entire deposit.
and the orientation of key mineralised structures is
considered to have introduced a sampling bias, this
should be assessed and reported if material. * Most drilling is angled (7 holes are vertical), thus
intersecting the mineralisation appropriately.
* No biases are expected from the drilling direction.
Sample
security * The measures taken to ensure sample security. * Samples are stored at a secure company facility
(Sindirgi Depot) in a clean area free of any
contamination.
* During drilling programmes pre-2019 samples were
delivered to ALS Global, Izmir once a week by Aras
Cargo, Sindirgi. The measures taken to ensure sample
security for samples used for analysis and QA/QC
include the following:
1. Chain of Custody is demonstrated by both the Company
and ALS Global in the delivery and receipt of sample
materials.
2. Upon receipt of samples, ALS Global delivers by
email to the Company's designated Quality Control
Manager, confirmation that each batch of samples has
arrived, with its tamper-proof seal intact, at the
allocated sample preparation facility.
3. Any damage to or loss of samples within each batch
(e.g., total loss, spillage or obvious contamination),
must also be reported to the Company in the form of
a list of samples affected and detailing the nature
of the problem(s).
* In all drilling programmes since 2020, the majority
of samples have been analysed by the laboratory at
the Kiziltepe Mine, 14 km by road from Kepez North.
Samples are delivered securely by the exploration
team and are securely held at the laboratory in the
fenced off and guarded mine site, with no
unauthorised access.
Audits or
reviews * The results of any audits or reviews of sampling * Ariana has implemented QA/QC programmes covering all
techniques and data. aspects of sample location and collection that meets
or exceeds the currently accepted industry standards.
* Ariana implemented a QA/QC programme based on
international best practice during the initial
exploration work and subsequent drilling programmes.
The company has continued to review and refine the
QA/QC programme as these exploration campaigns have
progressed.
============= ============================================================ ===================================================================
Section 2 Reporting of Exploration Results
(Criteria listed in the preceding section also apply to this
section.)
Criteria JORC Code explanation Commentary
Mineral
tenement and * Type, reference name/number, location and ownership * The Kepez Project is within one of four operating
land tenure including agreements or material issues with third licenses owned in the Sindirgi District of Balikesir
status parties such as joint ventures, partnerships, Province in western Turkey by Zenit Madencilik San.
overriding royalties, native title interests, ve Tic. A.S. ("Zenit") Joint Venture ("JV") with
historical sites, wilderness or national park and Proccea Construction Co. and Ozaltin Holding A.S.
environmental settings. (23.5% owned by Ariana). Licence number: 44830.
* The security of the tenure held at the time of * Royalties include the State Right payable to the
reporting along with any known impediments to Turkish Government and a Net Smelter Return ("NSR")
obtaining a licence to operate in the area. royalty of up to 2.5% on production is payable to
Franco-Nevada Corporation.
* There are no known impediments to current operations.
Exploration
done by other * Acknowledgment and appraisal of exploration by other * In 1990, Eurogold Madencilik A.S. conducted regional
parties parties. BLEG stream-sediment sampling around the Kiziltepe
area. This led to the initial discovery of anomalous
gold in the district. Follow-up work led to the
identification of several gold-bearing low
sulphidation epithermal veins.
* The Kepez area (Kepez Main, North, South, West, Far
West) was then explored from 1991 by Tuprag
Madencilik Ltd. and Newmont Overseas Exploration Ltd.
joint venture. In 1992 the licence area was acquired
via state auction by Tuprag following the
identification of areas of potential hydrothermal
alteration, as defined in Landsat colour-composite
imagery. The Kepez North vein was drill-tested for
the first time with nine drill holes totalling 440m,
each intercepting some mineralisation.
* In 1994, Normandy La Source acquired the project from
the joint venture. No further exploration was carried
out and the licence areas were relinquished.
* Newmont acquired the key licences via state auction
in 2000. In 2002, Newmont undertook an exploration
targeting exercise using Landsat structural
interpretations and new BLEG stream-sediment
geochemistry across the Sindirgi district, which led
to the rediscovery of the epithermal veins. They
completed an extensive programme of regional and
detailed rock-chip sampling.
* Galata Madencilik San. ve Tic . Ltd., the wholly
owned subsidiary of Ariana, acquired the licences in
early 2005.
* Since 2006 Ariana Resources have completed new
mapping and sampling, including diamond drilling (HQ),
blast hole RAB drilling (RAB), rock-saw channel
sampling of vein outcrop and composite rock-chip
sampling of scree material.
Geology
* Deposit type, geological setting and style of * The Kiziltepe area is dominated by Miocene volcanic
mineralisation. rocks, comprising a series of dacitic volcanoclastic
units, which host the low sulphidation epithermal
gold-silver style mineralisation envelope. An upper
dacitic ignimbrite unit, covers parts of the vein
field.
* The Kepez North prospect is situated 14km haulage
distance from the Kiziltepe processing plant. The
prospect contains 2.5km of dominantly north-trending
and bifurcating low-sulphidation style vein outcrop
over a series of ridges near the village of Kepez.
The Kepez North main outcrop vein is approximately
600m long and up to 20m wide. It is positioned at the
contact between dacitic pyroclastic and ophiolitic
rocks and dips at 50(o) to the west. The majority of
the gold mineralisation in this vein occurs in a
matrix supported hydrothermal quartz breccia which
occurs in a limited zone of approximately 100m along
strike. The mineralisation is silver rich with some
veins showing an Ag:Au ratio of between 4:1 and 8:1.
In places, a pyrite content of up to 40% is observed,
but this is typically 1 to 5%. Mineralised scree from
old workings along the Kepez Main hanging wall
(containing average grades of approximately 7g/t Au +
65g/t Ag) has been defined from previous sampling.
Drill hole
Information * A summary of all information material to the * All drilling prior to 2021 has been reported. The
understanding of the exploration results including a table below summarises the 2021 HQ diamond drilling
tabulation of the following information for all programme.
Material drill holes:
o easting and northing of the drill
hole collar
o elevation or RL (Reduced Level -
elevation above sea level in metres)
of the drill hole collar
o dip and azimuth of the hole
o down hole length and interception
depth
o hole length.
* If the exclusion of this information is justified on
the basis that the information is not Material and
this exclusion does not detract from the
understanding of the report, the Competent Person
should clearly explain why this is the case.
Data
aggregation * In reporting Exploration Results, weighting averaging * Metal equivalents have not been used.
methods techniques, maximum and/or minimum grade truncations
(e.g. cutting of high grades) and cut-off grades are
usually Material and should be stated. * Significant down-hole intercepts calculated for the
Kepez North 2021 drilling programme, using a 1g/t Au
minimum cut-off and allowing for up to 2m internal
* Where aggregate intercepts incorporate short lengths dilution:
of high grade results and longer lengths of low grade
results, the procedure used for such aggregation Hole ID From (m) To (m) Interval (m) Gold g/t Silver g/t
should be stated and some typical examples of such KPZ-D01-21 0 1.5 1.5 5.02 51.0
aggregations should be shown in detail. --------- ------- ------------- --------- -----------
4.5 5.5 1.0 1.12 22.0
--------- ------- ------------- --------- -----------
* The assumptions used for any reporting of metal KPZ-D02-21 0 4.0 4.0 8.26 107.3
equivalent values should be clearly stated. --------- ------- ------------- --------- -----------
18.0 19.0 1.0 1.39 10.0
--------- ------- ------------- --------- -----------
23.0 25.7 2.7 15.26 90.7
--------- ------- ------------- --------- -----------
28.5 31.1 2.6 5.75 9.2
--------- ------- ------------- --------- -----------
KPZ-D03-21 0 4.5 4.5 10.21 133.8
--------- ------- ------------- --------- -----------
28.9 34.9 6.1 2.34 22.5
--------- ------- ------------- --------- -----------
KPZ-D04-21 40.6 41.6 1.0 2.16 1.0
--------- ------- ------------- --------- -----------
Relationship
between * These relationships are particularly important in the * Down hole length, true width not known.
mineralisation reporting of Exploration Results.
widths and
intercept
lengths * If the geometry of the mineralisation with respect to
the drill hole angle is known, its nature should be
reported.
* If it is not known and only the down hole lengths are
reported, there should be a clear statement to this
effect (e.g. 'down hole length, true width not
known').
Diagrams
* Appropriate maps and sections (with scales) and
tabulations of intercepts should be included for any
significant discovery being reported These should
include, but not be limited to a plan view of drill
hole collar locations and appropriate sectional
views.
Balanced
reporting * Where comprehensive reporting of all Exploration * Intercept depths are stated in the drill hole
Results is not practicable, representative reporting information but not stated in the data aggregation
of both low and high grades and/or widths should be methods section, which include lower grade
practiced to avoid misleading reporting of intersections. Widths of intercepts are stated.
Exploration Results.
Other
substantive * Other exploration data, if meaningful and material, * In October 2014, Ariana commenced a ground magnetic
exploration should be reported including (but not limited to): survey over the Kiziltepe Sector JV licences
data geological observations; geophysical survey results; (totalling 50 km(2) ), including Kepez. The
geochemical survey results; bulk samples - size and geophysical survey was undertaken by the Ariana field
method of treatment; metallurgical test results; bulk team utilising two backpack magnetometers with
density, groundwater, geotechnical and rock continuous readings undertaken along N-S oriented
characteristics; potential deleterious or lines spaced 200m apart.
contaminating substances.
* Prior to the initiation of the geophysical survey the
Company collected approximately 15,000 soil samples
across the JV licence area (totalling 100 km(2) )
including Kepez, and analysed these using a pXRF
device. The soil samples were collected every 50m
along N-S oriented lines spaced 100m apart. The
resulting pXRF geochemical maps have provided an
unprecedented amount of data coverage for key trace
elements (e.g. antimony, arsenic, copper, lead,
manganese, molybdenum and zinc) which can be used as
vectors to gold and silver mineralisation.
Further work
* The nature and scale of planned further work (e.g. * Substantial at surface and near surface exploration
tests for lateral extensions or depth extensions or targets exist within the immediate and surrounding
large-scale step-out drilling). areas of Kepez North, including Kepez Main, Kepez
South, Kepez West and Kepez Far West. These generally
exist as strike extensions of known gold bearing
* Diagrams clearly highlighting the areas of possible quartz veins that have not been drill tested
extensions, including the main geological adequately due to Company exploration priorities and
interpretations and future drilling areas, provided budget.
this information is not commercially sensitive.
* Additional drilling work is scheduled for the near
future.
=============== =============================================================== ====================================================================================
Section 3 Estimation and Reporting of Mineral Resources
(Criteria listed in section 1, and where relevant in section 2,
also apply to this section.)
Criteria JORC Code explanation Commentary
Database
integrity * Measures taken to ensure that data has not been * The Kepez resource data is stored in Datashed. Data
corrupted by, for example, transcription or keying is now being transferred to MX Deposit, the database
errors, between its initial collection and its use management system to be used by the company, starting
for Mineral Resource estimation purposes. in Q3 2021.
* Data validation procedures used. * Data was logged onto field sheets which were then
entered into the data system by data capture
technicians.
* Data was validated on entry into the database, or on
upload from the earlier MS Access databases, by a
variety of means including the enforcement of coding
standards, constraints and triggers. These are
features built into the data model that ensure data
meets essential standards of validity and
consistency.
* Laboratory data has been received in digital format
and uploaded directly to the database.
* Original data sheets and files have been retained and
are used to validate the contents of the database
against the original logging.
* Zenit Madencilik and Independent consultants Odessa
Resources Pty Ltd performed a visual validation by
reviewing drill holes on section and by subjecting
drill hole data to data auditing processes in
specialised mining software (e.g. checks for sample
overlaps etc.).
* Independent consultants Tetra Tech performed a visual
validation by reviewing drill holes on section in
Datamine Studio RM mining software.
* Ariana Resources performed validation checks in
Leapfrog GEO and EDGE.
Site visits
* Comment on any site visits undertaken by the * Ariana staff have visited the site on numerous
Competent Person and the outcome of those visits. occasions, and supervised all drilling, sampling and
other operations at all times in order to introduce
appropriate logging, sampling and drilling protocols.
* If no site visits have been undertaken indicate why
this is the case.
* Zack van Coller (BSc Hons.) of Ariana Resources has
been involved in all work on the project since 2010.
* Ruth Bektas (BSc Hons., CGeol, EurGeol) of Ariana
Resources is acting as the CP for this study, and has
been on site during active drilling programmes and
other exploration activities.
* Ariana Resources, Galata Madencilik and Zenit
Madencilik field staff are permanently on site.
Geological
interpretation * Confidence in (or conversely, the uncertainty of ) * Kepez North is part of a 2.5km of dominantly
the geological interpretation of the mineral deposit. North-trending and bifurcating low-sulphidation (LS)
style vein system outcropping along ridges.
* Nature of the data used and of any assumptions made.
* Interpretations of geological surfaces are derived
from 3D modelling of drill hole lithological data in
* The effect, if any, of alternative interpretations on Leapfrog GEO and EDGE v. 6.0.
Mineral Resource estimation.
* Interpolation and wireframe modelling of the
* The use of geology in guiding and controlling Mineral mineralised zones in Leapfrog EDGE was completed
Resource estimation. using a 0.2g/t Au modelling cut-off grade (CoG).
Where continuity was not established between sections,
the strike extrapolation was limited both manually
* The factors affecting continuity both of grade and (wireframes) and statistically (interpolations). The
geology. continuity of the various structures is reflected in
the Mineral Resource classification.
Dimensions
* The extent and variability of the Mineral Resource * Kepez North resource dimensions are 230m wide x 525m
expressed as length (along strike or otherwise), plan along strike x 230m down dip (X x Y x Z).
width, and depth below surface to the upper and lower
limits of the Mineral Resource.
Estimation and
modelling * The nature and appropriateness of the estimation * Two domains were modelled - one for the main vein
techniques technique(s) applied and key assumptions, including material and one for the mineralised scree material
treatment of extreme grade values, domaining, up to 5m from the surface.
interpolation parameters and maximum distance of
extrapolation from data points. If a computer
assisted estimation method was chosen include a * Compositing was completed in Leapfrog EDGE using a 1m
description of computer software and parameters used. best fit routine. Hard domain boundaries were applied
to both deposit models, which forced all samples to
be included in one of the composites by adjusting the
* The availability of check estimates, previous composite length, while keeping it as close as
estimates and/or mine production records and whether possible to the selected intervals of 1m.
the Mineral Resource estimate takes appropriate
account of such data.
* A top-cut was not applied to the assay results or
composites. The maximum gold value is 20.31g/t, which
* The assumptions made regarding recovery of is below the 30g/t Au top-cut determined from
by-products. statistical analysis of the Kiziltepe-Kepez area as a
whole. Despite silver showing significantly higher
values than in other areas of the Kiziltepe Gold
* Estimation of deleterious elements or other non-grade Corridor (incl. Kepez), the values did not warrant a
variables of economic significance (e.g. sulphur for top-cut.
acid mine drainage characterisation).
* Isotropic search ellipses and ranges were used.
* In the case of block model interpolation, the block Variable orientation was used in Leapfrog EDGE to
size in relation to the average sample spacing and better represent the grade distribution.
the search employed.
* The block models were constructed using a 2.5 mE by
* Any assumptions behind modelling of selective mining 2.5 mN by 2.5 mRL parent block size, in relation to
units. an average of 10-12.5m drill spacing near the vein.
* Any assumptions about correlation between variables. * Variography was assessed, however the sample
population is too small to obtain reasonable results
for use in an Ordinary Kriging estimation. The
* Description of how the geological interpretation was variable orientation (dynamic anisotropy) function
used to control the resource estimates. was used for estimation of grade into the vein domain
whilst the orientation of the scree at surface was
used for estimation into the scree domain.
* Discussion of basis for using or not using grade
cutting or capping.
* The grades were interpolated into the 2.5m x 2.5m x
2.5m blocks by Inverse Distance Weighting Squared
* The process of validation, the checking process used, (ID2) at the parent block scale using a three-pass
the comparison of model data to drill hole data, and estimation, adopting a multi-pass methodology.
use of reconciliation data if available.
* The block model is a non-rotated conventional block
model with no sub-blocking used.
* Check estimates were carried out and the final
estimate was compared to previous estimates.
* Gold and silver have been estimated as mining
products. No by-products or deleterious elements have
been modelled.
* In general, gold and silver show a positive
correlation with each other.
* A visual validation between drillhole data, composite
data and block model data was carried out.
Moisture * Tonnes have been estimated on a dry basis.
* Whether the tonnages are estimated on a dry basis or
with natural moisture, and the method of
determination of the moisture content.
Cut-off
parameters * The basis of the adopted cut-off grade(s) or quality * Mineralisation has been modelled above a 0.2 g/t Au
parameters applied. cut-off grade and reported above a 1.0 g/t Au cut-off
grade. Cut-off grade is calculated from assumptions
on mining and processing cost, metallurgical recovery
and metals prices.
Mining factors
or assumptions * Assumptions made regarding possible mining methods, * No mining factors (i.e., dilution, ore loss,
minimum mining dimensions and internal (or, if recoverable resources at selective mining block size)
applicable, external) mining dilution. It is always have been applied to the original resource.
necessary as part of the process of determining
reasonable prospects for eventual economic extraction
to consider potential mining methods, but the * It is assumed that the deposit will be an open pit
assumptions made regarding mining methods and operation with ore material trucked to the Kiziltepe
parameters when estimating Mineral Resources may not Mine carbon in leach (CIL) plant for gold and silver
always be rigorous. Where this is the case, this extraction, 14km by road.
should be reported with an explanation of the basis
of the mining assumptions made.
* The following assumptions and mining factors were
applied during the pit optimisation stage:
o Price: $55.8/g Au, $0.803/g Ag
o Mining recovery: 100%
o Mining dilution: 10%
o Mining cost: $1.1/t
o Process Cost + G&A: $52/t
o 40(o) general pit slope angle. The in-pit resource is not
sensitive to minor changes to
this angle.
Metallurgical
factors or * The basis for assumptions or predictions regarding * No metallurgical assumptions have been built into the
assumptions metallurgical amenability. It is always necessary as resources, though prior studies undertaken at
part of the process of determining reasonable EtiGumus showed very high gold and silver recover.
prospects for eventual economic extraction to Further metallurgical test work will be carried out.
consider potential metallurgical methods, but the
assumptions regarding metallurgical treatment
processes and parameters made when reporting Mineral * The operating Kiziltepe plant (where the Kepez North
Resources may not always be rigorous. Where this is ore will eventually be processed) has life of mine
the case, this should be reported with an explanation (LOM) average recoveries of 92.9% and 71.3% for gold
of the basis of the metallurgical assumptions made. and silver respectively. A Process Recovery of 90%
and 70% has been applied to the pit optimisation for
gold and silver, respectively.
Environmental
factors or * Assumptions made regarding possible waste and process * The CP is not aware of any known environmental or
assumptions residue disposal options. It is always necessary as permitting issues on the projects.
part of the process of determining reasonable
prospects for eventual economic extraction to
consider the potential environmental impacts of the * Statutory forestry permits have been approved by the
mining and processing operation. While at this stage Prime Ministry and issued by the Department of
the determination of potential environmental impacts, Forestry for the Kiziltepe and Kepez areas of the
particularly for a greenfields project, may not Kiziltepe Sector.
always be well advanced, the status of early
consideration of these potential environmental
impacts should be reported. Where these aspects have
not been considered this should be reported with an
explanation of the environmental assumptions made.
Bulk density
* Whether assumed or determined. If assumed, the basis * An average specific gravity value of 2.6g/cm(3) was
for the assumptions. If determined, the method used, used for both vein and scree material based on
whether wet or dry, the frequency of the measurements specific gravity measurements on core samples and
, operational data from the Kiziltepe Mine.
the nature, size and representativeness of the
samples.
* The bulk density for bulk material must have been
measured by methods that adequately account for void
spaces (vugs, porosity, etc), moisture and
differences between rock and alteration zones within
the deposit.
* Discuss assumptions for bulk density estimates used
in the evaluation process of the different materials.
Classification
* The basis for the classification of the Mineral * The Mineral Resource is classified in line with the
Resources into varying confidence categories. guidelines of the 2012 JORC code as Measured,
Indicated and Inferred. The classification is
determined based on search pass spacing, with
* Whether appropriate account has been taken of all increasing confidence with proximity to drill holes.
relevant factors (i.e. relative confidence in
tonnage/grade estimations, reliability of input data,
confidence in continuity of geology and metal values, * Measured Mineral Resources have been defined by Pass
quality, quantity and distribution of the data). 1 (up to 40m x 20m x 10m) depending on the vein
characteristics and drill hole spacing.
* Whether the result appropriately reflects the
Competent Person's view of the deposit. * Indicated Mineral Resources have been defined by Pass
2 (up to 80m x 40m x 20m) depending on the vein
characteristics and drill hole spacing.
* Inferred Mineral Resources have been defined in areas
beyond the indicated search radius to the limits of
the resource wireframes (up to 200m x 100m x 50m).
* The Measured and Indicated components are further
constrained to the limits of the pit optimisation
study.
Audits or
reviews * The results of any audits or reviews of Mineral * The ID(2) model was validated against the input drill
Resource estimates. hole composites for the vein and scree models by
visual comparisons carried out against the composited
drill hole samples against the modelled block grade.
* A comparison was made between the analytical volumes
of the resource wireframes and the volumes reported
through volumetric functions. The difference was less
than 0.3%. Thus, a high-level confidence is
appropriate for the model reports. The estimated
grades were validated against average Au and Ag grade
statistics for each lode.
Discussion of
relative * Where appropriate a statement of the relative * The Mineral Resource estimate at the global level for
accuracy/ accuracy and confidence level in the Mineral Resource the Measured and Indicated Resources based on the
confidence estimate using an approach or procedure deemed estimation technique and data quality and
appropriate by the Competent Person. For example, the distribution is considered to be adequate for the
application of statistical or geostatistical classification.
procedures to quantify the relative accuracy of the
resource within stated confidence limits, or, if such
an approach is not deemed appropriate, a qualitative * Inferred Resources have a lower level of confidence
discussion of the factors that could affect the outside of this range.
relative accuracy and confidence of the estimate.
* The statement should specify whether it relates to
global or local estimates, and, if local, state the
relevant tonnages, which should be relevant to
technical and economic evaluation. Documentation
should include assumptions made and the procedures
used.
* These statements of relative accuracy and confidence
of the estimate should be compared with production
data, where available.
=============== ============================================================ =============================================================================
NOTE: Sections 4 and 5 are not relevant to this work as no
reserves are being estimated and there is no estimation or
reporting of diamonds or other gemstones in this project.
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