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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Ariana Resources Plc | LSE:AAU | London | Ordinary Share | GB00B085SD50 | ORD 0.1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.10 | 4.00% | 2.60 | 2.40 | 2.70 | 2.60 | 2.50 | 2.50 | 1,414,992 | 16:35:20 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Gold Ores | 0 | 4.03M | 0.0035 | 7.29 | 29.23M |
TIDMAAU
RNS Number : 1898K
Ariana Resources PLC
09 April 2018
9 April 2018
AIM: AAU
TAVSAN RESOURCE UPDATE
Ariana Resources plc ("Ariana" or "the Company"), the exploration and development company with gold mining operations in Turkey, is pleased to announce a Joint Ore Reserves Committee ("JORC") Resource update for the Tavsan Project ("Tavsan" or "the Project"). Tavsan is part of the Red Rabbit Joint Venture ("JV") with Proccea Construction Co. and is 50% owned by Ariana through its shareholding in Zenit Madencilik San. ve Tic. A.S. ("Zenit").
Highlights:
-- Resource Estimate substantially de-risks the Project, following a material improvement in the resource classification; 71% of the resource now in Measured and Indicated.
-- Global resource of 3.98Mt at 1.32 g/t Au and 4.46 g/t Ag for 168,900 oz Au and 571,700 oz Ag (all categories), contained largely within Scoping Study pit shapes*.
-- Additional JORC Exploration Target of up to a further 9.70Mt at 1.30 g/t Au (for c. 400,000 oz Au)*.
-- New classification enables JV to proceed with a Feasibility Study and Environmental Impact Assessment ("EIA") for Tavsan, without further resource drilling.
-- Potential resource extensions are represented by a number of drill holes including 11m @ 5.11 g/t Au + 6.83g/t Ag, 6m @ 3.37g/t Au + 3.67g/t Ag and 9m @ 1.30g/t Au + 4.32g/t Ag within c.20m from surface.
Dr. Kerim Sener, Managing Director, commented:
"This is an exceptionally pleasing and robust resource update for the Tavsan Project. We are increasingly confident in the potential for Tavsan to be developed in the medium-term and that planned mine life can be increased beyond four years, as previously defined in the Scoping Study of 2016. The JV is targeting the development of Tavsan as a semi-autonomous project with the Kiziltepe Mine, within the broader context of the Red Rabbit Joint Venture with Proccea Construction Co. Further work will be required on a Feasibility Study and EIA, which the JV is aiming to complete largely in-house, along with associated permitting. The JV is planning to commence these work programmes during 2018, which are expected to be funded through cash flow from the Kiziltepe Mine."
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.
* All Mineral Resource figures in the announcement are quoted gross with respect to the Red Rabbit Joint Venture, of which 50% is owned by Ariana.
Resource Estimate
Zenit Madencilik San. ve Tic. A.S. (Zenit) engaged Tetra Tech to complete a Joint Ore Reserves Committee ("JORC") compliant Mineral Resource estimate for the Tavsan Project. The updated Mineral Resource estimate is based on an improved understanding of the spatial continuity between samples collected from drill holes, utilising a revised geological model and appropriate application of geostatistical methods. Appendix 1 provides more detail on sampling techniques and data used in this estimation.
In compliance with the JORC code (2012), the Mineral Resource Estimate detailed here includes material scientific and technical information in respect of the Project. The Mineral Resource is based on additional spatial continuity studies completed by Tetra Tech in May 2017, which determined that spatial continuity of samples is sufficient to support an upgrade of the resource to at least Indicated category. The Mineral Resource will inform an updated infill drilling programme to target those areas that remain in the Inferred category, thereby significantly reducing the drilling and sampling required for further improvements in the classification of resources.
This estimate supersedes the earlier published Mineral Resource estimate for Tavsan completed in 2008 by SRK Consulting (UK) Ltd, which was undertaken in accordance with the earlier JORC code (2004) and involved a different geological model that encompassed all drilling. The 2008 resource was also undertaken using the conventional mathematical method of Inverse Distance Weighted Squared ("IDW2") rather than the geostatistical approach taken here. Some areas included in the 2008 resource are specifically excluded in the current resource and instead have been assigned to an Exploration Target (see below), due to lower geological confidence. The current estimate focused primarily on areas that are considered amenable to shallow open-pit mining (Figure 1) as defined in the Scoping Study (announced on 10 November 2016). The Scoping Study determined that approximately 2.7Mt at 1.6 g/t Au and 3.0 g/t Ag (then in Inferred and Indicated categories) was contained within four Whittle pit shells at a strip ratio of 2:1 and the majority of the resource detailed here coincides specifically with these areas (Figure 1).
Geological Summary
Gold mineralisation at Tavsan is epithermal in style, with associated silver and antimony, broadly situated along the thrust contact between Jurassic massively bedded limestone and an overlying Cretaceous multi-lithic ophiolite sequence. In addition, a karstic network within the limestone and fractures within the ophiolitic rocks may have acted as secondary conduits for the development of some jasperoidised-silicified ("jasperoid") rocks, several tens of meters, below and above of the thrust fault contact, respectively.
The mineralised jasperoid plane developed along the thrust contact is irregular on a ten meter-scale but broadly follows the gentle topography on a hundred meter-scale, and is largely exposed at surface (Figure 1). In the vicinity of a NE-SW trending fault zone, the thrust is steeper than the topographic gradient, resulting in a more steeply dipping zone of mineralisation. The greatest thickness of gold-bearing jasperoid is observed in the vicinity of the NE-SW fault zone. However, gold concentration appears to have a dominant NW-SE control within the jasperoid as a whole, suggesting potential for steeply dipping conduit structures cross-cutting the limestone units in the footwall.
http://www.rns-pdf.londonstockexchange.com/rns/1898K_-2018-4-8.pdf
Figure 1: Map of the Tavsan Project, showing the main resource areas (in red) with pits designed as part of the Scoping Study (outlined in yellow). Substantial areas exist outside of the planned pits which have not been sufficiently drill tested, yet show potential for resource extensions (in pale yellow). These areas form part of the JORC Exploration Target. Selected drill hole and trench results which support the Exploration Target are identified in these areas.
Estimation Methodology
Wireframe models of the jasperoid were developed by linking sectional interpretations. The models were created based upon interval selections that referenced the gold grades, lithological descriptions and structural interpretation. Grades greater than 0.5 g/t gold were linked together between each drill-section. Where continuity was not established between sections, the strike extrapolation was limited. The continuity of the various structures is reflected in the Mineral Resource classification.
Compositing was completed in Datamine using a 1m best fit routine, applying hard domain boundaries, 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 interval of 1m. Decile analysis of the composited data indicates that the data set did not have undue bias at higher-grades and therefore no top cut was applied.
Specific gravity was determined based on seven analyses for the Tavsan deposit. The average of the limestone units is 2.55 g/cm(3) and the average of the jasperoid unit is 2.59 g/cm(3) . The density was interpolated into the block model by the IDW2 method based on a mean value of 2.57 g/cm(3) for all mineralised blocks that did not receive an estimate grade, or where other lithologies appeared in the selected sample set.
Variography was attempted for the entire data set as a single population, but no suitable variograms could be established, probably due to the variation in geometry of the satellite areas. However, good variogram model fit was achieved for the Main Zone where good directionality and range was observed. The Satellite zones have much lower sample numbers, resulting in poorer model fits. Consequently, the Main Zone variogram model was applied to all zones on the basis that, although spatially separate, the zones are all genetically linked. A good variogram model fit was achieved for downhole, major, semi-major directions, with a nugget effect of 0.19.
A non-rotated block model was established using block sizes determined to be optimal for the dataset and wireframe geometry of 10 x 20 x 5m. Standardised sub-cell splitting to the minimum block size of 5 x 10 x 1m was employed to enable subsequent pit optimisation and mine design. Sub-cells received parent cell grades during estimation and grades were estimated using Ordinary Kriging, adopting a multi-pass methodology.
Resource Classification
The Mineral Resource is classified according to the guidelines presented within the 2012 JORC code (Table 1), providing Measured, Indicated and Inferred resources. Approximately 13% of the global resource is classified as Measured and 58% classified as Indicated. The style of mineralisation has been identified, the controls on mineralisation are well understood and measurements and sampling completed to a reasonable degree of confidence for the mineralisation present (Appendix 1). It is considered reasonable to expect that some of the Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration; however, due to the uncertainty of Inferred Mineral Resources it should not be assumed that such upgrading will always occur. It is also reasonable to expect that portions of the Indicated Mineral Resources could be upgraded to Measured Mineral Resources with some additional infill data.
Confidence in the estimate of the Mineral Resources is sufficient to allow the results of the application of technical and economic parameters to be used for detailed planning in a Feasibility Study. Some drilling will be planned to help support the Feasibility Study and EIA but this will be focused on limited infill drilling and geotechnical drilling, and is not likely to exceed 1,000m. In addition to supporting a Feasibility Study, this new Mineral Resource will assist the targeting of future exploratory and resource drilling in order to expand the resource further, particularly in areas comprising the Exploration Target.
Table 1: Summary of JORC Mineral Resources for Tavsan, at a cut-off grade of 0.7 g/t Au.
Au Au Ag (troy Ag Classification Zone Tonnes (g/t) (g/t) oz) (troy oz) ============================== =================== ========== ======= ======= ======== =========== Measured Main 537,000 1.80 3.98 30,900 68,600 ------------------------------ ------------------- ---------- ------- ------- -------- ----------- Indicated Main 1,758,000 1.23 3.61 69,400 203,600 ------------------------------ ------------------- ---------- ------- ------- -------- ----------- North 181,000 1.01 15.08 5,900 87,600 -------------------------------------------------- ---------- ------- ------- -------- ----------- West 361,000 1.19 4.93 13,800 57,100 -------------------------------------------------- ---------- ------- ------- -------- ----------- Measured and Indicated Total 2,837,000 1.32 4.58 120,100 416,900 --------------------------------------------------- ---------- ------- ------- -------- ----------- Inferred Main & Satellites 1,142,000 1.33 4.22 48,800 154,800 ------------------------------ ------------------- ---------- ------- ------- -------- ----------- Global Total 3,979,000 1.32 4.46 168,900 571,700 =================================================== ========== ======= ======= ======== ===========
Notes: Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues may materially affect the estimate of Mineral Resources. Ariana and Tetra Tech are not aware of any material barrier to eventual economic extraction. Numbers may not correctly sum due to rounding. An inconsequential part of the Satellite zones is located outside of the current operating licences.
Exploration Target
The mineralised jasperoid units at Tavsan are extensive and have been mapped in detail. There are large areas of prospective mineralisation that have been mapped, and in some cases sampled either by drilling or surface methods, which have not been included in the Resource statement, as the data supporting these areas is not considered sufficient. However, these mineralised areas do represent exploration potential for the project.
Assuming a mean thickness of 5m, derived from the thoroughly interpreted mineralised areas, an additional tonnage in the range of approximately 8 to 10Mt at a density of 2.57 g/cm(3) is possible for the Exploration Target. It is expected that the grade would range between 1.0 and 1.3 g/t Au. The Exploration Target areas (Figure 1) have been labelled A - E and the ranges for each area, based on their volume and neighbouring Resource grades (Table 2).
Table 2: JORC Exploration Target defined by exploration area, showing a range of possible tonnages and gold grades. Silver has not been included in these calculations as it is not as economically significant as gold and, hence, would not help inform exploration decision-making.
Exploration Tonnage Grade Area (Mt) (g/t Au) ------------ ---------- ------- A 0.7 - 0.8 1.0 - 1.3 ------------ ---------- ------- B 3.0 - 3.6 1.2 - 1.4 ------------ ---------- ------- C 2.8 - 3.5 1.2 - 1.4 ------------ ---------- ------- D 1.0 - 1.3 1.2 - 1.5 ------------ ---------- ------- E 0.4 - 0.5 1.0 - 1.1 ------------ ---------- ------- Total 7.9 - 9.7 1.0 - 1.3 ------------ ---------- -------
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 Adam James / Tom Salvesen Yellow Jersey PR Limited Tel: +44 (0) 7544 275 882 Tim Thompson / Harriet Jackson arianaresources@yellowjerseypr.com / Henry Wilkinson
Editors' Note
The updated Mineral Resource estimate update was prepared by Tetra Tech, under the direction of Mr. Joe Hirst B.Sc., M.Sc. EurGeol (European Geologist) CGeol (Chartered Geologist). Mr. Hirst is a Resource Geologist at Tetra Tech, and an independent Competent Person as defined by the JORC Code, 2012 Edition. The results are reported in accordance with the JORC code.
Mr. Hirst has reviewed the technical and scientific information in this press release relating to the Mineral Resource estimates and has approved the use of the information contained herein.
About Ariana Resources:
Ariana is an exploration and development company with mining operations focused on epithermal gold-silver and porphyry copper-gold deposits in Turkey, the largest gold producing country in Europe. The Company is developing a portfolio of prospective licences originally selected on the basis of its in-house geological and remote-sensing database, which now contain a total of 1.6 million ounces of gold and other metals. Ariana's objective is to cost-effectively add value to its projects through focused exploration and to develop its operations, primarily through well-financed joint ventures.
The Company's flagship assets are its Kiziltepe and Tavsan gold projects which form the Red Rabbit Gold Project. Both contain a series of prospects, within two prolific mineralised districts in the Western Anatolian Volcanic and Extensional (WAVE) Province in western Turkey. This Province hosts the largest operating gold mines in Turkey and remains highly prospective for new porphyry and epithermal deposits. These core projects, which are separated by a distance of 75km, form part of a 50:50 Joint Venture with Proccea Construction Co. The Kiziltepe Sector of the Red Rabbit Project is fully-permitted and is currently in production. The total resource inventory at the Red Rabbit Project and wider project area stands at c. 605,000 ounces of gold equivalent. 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.
In north-eastern Turkey, Ariana owns 100% of the Salinbas Gold Project, comprising the Salinbas gold-silver deposit and the Ardala copper-gold-molybdenum porphyry among other prospects. The total resource inventory of the Salinbas project area is c. 1 million ounces of gold equivalent. A NSR royalty of up to 2% on future production is payable to Eldorado Gold Corporation.
Panmure Gordon (UK) Limited are broker to the Company and Beaumont Cornish Limited is the Company's Nominated Adviser.
For further information on Ariana you are invited to visit the Company's website at www.arianaresources.com.
Glossary of Technical Terms:
"Ag" the chemical symbol for silver;
"Au" the chemical symbol for gold;
"cut-off grade" The lowest grade, or quality, of mineralised material that qualifies as economically mineable and available in a given deposit. May be defined on the basis of economic evaluation, or on physical or chemical attributes that define an acceptable product specification;
"g/t" grams per tonne;
"Indicated resource" a part of a mineral resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed;
"Inferred resource" a part of a mineral resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and has assumed, but not verified, geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that may be limited or of uncertain quality and reliability;
"Inverse Distance 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;
"m" Metres;
"Mt" million tonnes;
"JORC" the Joint Ore Reserves Committee;
"JORC 2004" is the previous edition of the JORC Code, which was published in 2004. It has been superseded by JORC 2012;
"JORC 2012" is the current edition of the JORC Code, which was published in 2012. After a transition period, the 2012 Edition came into mandatory operation in Australasia from 1 December 2013;
"m" Metres;
"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.
"oz" Troy Ounces. One Troy Ounce is equal to 31.1035 grams;
"Whittle" computer software that uses the Lerch-Grossman algorithm, which is a 3-D algorithm that can be applied to the optimisation of open-pit mine designs. The purpose of optimisation is to produce the most cost effective and most profitable open-pit design from a resource block model.
Ends.
Appendix 1: JORC Code, 2012 Edition - Table 1
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, * Geological mapping in conjunction with trenching and random chips, or specific specialised industry drilling was used to delineate areas of standard measurement tools appropriate to the mineralisation. Mineralisation is identified in the minerals under investigation, such as down hole gamma jasperoid unit. sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting the broad meaning of sampling. * All drilling was undertaken by Diamond Core Drilling (DD) and Reverse Circulation (RC) with all sampling in accordance with industry standard techniques. * Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. * Diamond core is cut in half to provide half core samples in lithologically appropriate intervals, with sampling extending before and after mineralisation. * Aspects of the determination of mineralisation that are Material to the Public Report. * For duplicate sample analysis the half core sample was cut into two quarter core samples, one as the * In cases where 'industry standard' work has been done primary sample and the other for duplicate analysis. 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 * DD core void of mineralisation was not a priority for charge for fire assay'). In other cases more the company and therefore not all core has been explanation may be required, such as where there is sampled once mineralisation controls were coarse gold that has inherent sampling problems. established. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information. * RC samples were split using a riffle splitter with a representative 1kg split sent for sample analysis, with remaining material stored for follow-up analysis. ============= ============================================================ ============================================================ Drilling techniques * Drill type (e.g. core, reverse circulation, open-hole * In total, 4,989 m of drilling across 156 drill holes hammer, rotary air blast, auger, Bangka, sonic, etc.) has been completed across the Tavsan deposit. 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 * Diamond drillholes comprise a combination of HQ and what method, etc.). NQ diameter (standard tube). * RC drillholes comprised drilling with a 5.5 inch diameter hammer. * All holes were drilled by Odyssey or earlier owners and their contractors prior to Ariana's acquisition. Drill sample * Method of recording and assessing core and chip * All drilling was supervised by a company geologist. recovery sample recoveries and results assessed. The length of core recovered was measured by an assistant after removal from the core barrel. All core was put into core boxes and transported to the * Measures taken to maximise sample recovery and ensure core shed where the core length was checked by a representative nature of the samples. geologist. * Whether a relationship exists between sample recovery * The length of core was recorded on paper logs, as and grade and whether sample bias may have occurred well as the length of the core run. These recordings due to preferential loss/gain of fine/coarse were later transferred into a database. The recovery material. is calculated by dividing the core length by the drill run length, which provides the percentage of core recovered per drill run. ============= ============================================================ ============================================================ Logging * Whether core and chip samples have been geologically * Core was logged geotechnically and geologically by and geotechnically logged to a level of detail to company geologists using a company standard logging support appropriate Mineral Resource estimation, protocol. mining studies and metallurgical studies. * Logging intervals are based on lithologies. * Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc.) photography. * The core is photographed before logging to provide a record of all DD core. * The total length and percentage of the relevant intersections logged. * RC drill chips were logged from sample chip trays. * Logging is to a standard suitable for the support of a Mineral Resource Estimate. Sub-sampling techniques * If core, whether cut or sawn and whether quarter, * Core samples were cut using a circular saw with water and sample half or all core taken. supply for dust suppression. preparation * If non-core, whether riffled, tube sampled, rotary * Sampling was taken across all mineralised zones and split, etc. and whether sampled wet or dry. extended into un-mineralised rock.
* For all sample types, the nature, quality and * Some core and RC samples with no mineralisation were appropriateness of the sample preparation technique. not sampled once mineralisation controls were established. * Quality control procedures adopted for all sub-sampling stages to maximise representivity of * All samples were submitted to ALS Chemex (Izmir) for samples. sample preparation and analysis, where crushing, milling, homogenization and sample splitting was completed in accordance with company standards. * Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/ * All suitable measures were taken to ensure sample second-half sampling. representivity. * Whether sample sizes are appropriate to the grain size of the material being sampled. ============= ============================================================ ============================================================ Quality of assay * The nature, quality and appropriateness of the * Standard and duplicate samples for QA/QC were taken data and assaying and laboratory procedures used and whether by ALS and performance was noted as good. laboratory the technique is considered partial or total. tests * Odyssey's own QA/QC programme has significant * For geophysical tools, spectrometers, handheld XRF shortcomings, but the lab performance is adequate to instruments, etc., the parameters used in determining support a mineral Resource estimation. the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc. * Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established. Verification of sampling * The verification of significant intersections by * Significant intercepts were inspected by various and assaying either independent or alternative company personnel. Ariana competent persons and SRK Consulting during site inspections. * The use of twinned holes. * Logging and sampling procedures are to recognised international standards. * Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols. * 10% of the data has been independently verified. * Discuss any adjustment to assay data. * Data input has been completed in accordance with company procedures, which have been reviewed by Tetra Tech. * Prior to resource estimation, below detection limit assay results have been replaced with values of half detection limit. ============= ============================================================ ============================================================ Location of data * Accuracy and quality of surveys used to locate drill * All collar locations are reported in UTM (WGS84) with points holes (collar and down-hole surveys), trenches, mine their locations recorded using a handheld GPS. UTM workings and other locations used in Mineral Resource Grid 35 N. estimation. * Down-hole surveys were recorded with Gyro Shot-type * Specification of the grid system used. equipment. Drill holes were re-surveyed, in some cases, by open hole methods at 20m intervals from surface, during a project review in 2015, using the * Quality and adequacy of topographic control. Ariana-owned Flexit down hole multi-shot survey device. * A topographic survey was completed for the Resource area using a DGPS system in certain areas. 5m and 25m contours were also generated from ortho-rectified WorldView satellite imagery for the project area as a whole. Data spacing and * Data spacing for reporting of Exploration Results. * The Resource area has been drilled as access allows, distribution resulting in irregular data spacing, typically between 25m and 100m between collars. * Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource * Samples were composite to 1m prior to estimation. and Ore Reserve estimation procedure(s) and classifications applied. * The current data spacing is sufficient to establish geological continuity and grade continuity has been * Whether sample compositing has been applied. established and tested by semi-variograms and post-estimation assessment, as such the Resource has been classified accordingly in the Measured, Indicated and Inferred categories depending on the local confidence of estimate. ============= ============================================================ ============================================================ Orientation of data * Whether the orientation of sampling achieves unbiased * The mineralisation is primarily outcropping at in relation sampling of possible structures and the extent to surface and has been drilled primarily vertically, to which this is known, considering the deposit type. with full intersections. Some inclined holes have geological been drilled between -80 and -40 degrees of dip, structure primarily stepped off from the mineralisation to * If the relationship between the drilling orientation delineate the edges of the mineralisation at depth. and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material. * No sampling bias is observed from the orientation of drilling with regards to the mineralised structures. * True thickness with respect to apparent thickness is well understood as most intersections are normal to the mineralisation. Sample
security * The measures taken to ensure sample security. * Samples are stored in a secure location. Full chain of custody documentation is used when transferring the samples to the laboratory and has been overseen by the responsible company geologist. ============= ============================================================ ============================================================ Audits or reviews * The results of any audits or reviews of sampling * Tetra Tech's Competent Person has reviewed the techniques and data. protocols and procedures adopted and finds the various aspects sufficient to support mineral Resource estimation. * Tetra Tech has completed an independent analysis of the QA/QC data completed by Odyssey, and whilst there are shortcomings the ALS lab QAQC programme was robust. The data is deemed appropriate or Resource estimation. ============= ============================================================ ============================================================
Section 2: Reporting of Exploration Results
(Criteria listed in the preceding section also apply to this section.)
Criteria JORC Code explanation Commentary Mineral tenement * Type, reference name/ number, location and ownership * Zenit holds the mineral rights to the Tavsan property and land including agreements or material issues with third in Joint Venture with Ariana Resources plc. tenure parties such as joint ventures, partnerships, status overriding royalties, native title interests, historical sites, wilderness or national park and * In 2008, Ariana acquired the Project for US$500,000 environmental settings. in cash and 3 million shares in the Company at 5 pence per share from Odyssey Resources Limited and a retained royalty of up to 2% on future gold * The security of the tenure held at the time of production payable to Teck Resources Limited. This reporting along with any known impediments to royalty has since been transferred to Sandstorm Gold obtaining a licence to operate in the area. Ltd =============== =============================================================== ============================================================== Exploration done by * Acknowledgment and appraisal of exploration by other * No other companies have completed exploration on the other parties. licence since Ariana's acquisition of the property parties from Odyssey. Geology * Deposit type, geological setting and style of * The property is located in the Izmir-Ankara suture mineralisation. zone in north-western Anatolia. The formations present span from Jurassic to Tertiary and typically comprise metamorphosed sedimentary sequences, displaying intense compressional tectonic features. * The Property includes an upper thrust plate of Late Cretaceous ophiolitic rocks (Dagardi Melange), jasperoid gold-bearing silicification along the thrust surface and a footwall of Jurassic Budagan Formation massive, a massive micritic limestone. * Mineralisation of the contact zone was observed to consist of jasperoidisation of limestone and intense silicification of the ophiolite sequence. =============== =============================================================== ============================================================== Drill Drill hole collar, survey lithology hole * A summary of all information material to the assay and significant intercept tables Information understanding of the exploration results including a have been prepared are disclosed within tabulation of the following information for all section 10.0 of the technical report. 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 * No upper or lower cut-offs have been applied when methods techniques, maximum and/ or minimum grade truncations disclosing the exploration data. (e.g. cutting of high grades) and cut-off grades are usually Material and should be stated. * No aggregation has been applied beyond the standard 1m sampling interval honouring lithological changes * Where aggregate intercepts incorporate short lengths down to 20cm. of high grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such * No metal equivalent has been applied. Metals are aggregations should be shown in detail. reported per metal. * The assumptions used for any reporting of metal equivalent values should be clearly stated. =============== =============================================================== ============================================================== Relationship between * These relationships are particularly important in the * The majority of the drillholes were advanced mineralisation reporting of Exploration Results. vertically. Some holes were advanced at between -80 widths and -40 degrees from horizontal to intersect dipping and intercept structures, or to delineate at depth. The mineralised lengths * If the geometry of the mineralisation with respect to formations are commonly flat lying. As such, the true the drill hole angle is known, its nature should be width is generally represented by the intersection reported. length. However, recorded intercept widths should not be regarded as true widths.
* If it is not known and only the down hole lengths are reported, there should be a clear statement to this * Three dimensional wireframe models have been effect (e.g. 'down hole length, true width not generated for sample selection to constrain the known'). resource estimate. This process eliminates any bias imparted by oblique intercepts. Diagrams * Appropriate maps and sections (with scales) and * A set of maps, sections and tabulations have been tabulations of intercepts should be included for any prepared and will be disclosed within the Technical significant discovery being reported. These should Report. 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 * Full balanced reporting of exploration results has Results is not practicable, representative reporting been undertaken and is disclosed within the Technical of both low and high grades and/ or widths should be Report. practiced to avoid misleading reporting of Exploration Results. Other substantive * Other exploration data, if meaningful and material, * Other substantive exploration data such as exploration should be reported including (but not limited to): geochemical sampling and geophysical exploration was data geological observations; geophysical survey results; previously undertaken to identify the drill targets. geochemical survey results; bulk samples - size and This Resource estimation considers samples contained method of treatment; metallurgical test results; bulk within a 3d interpretation to inform the estimate. No density, groundwater, geotechnical and rock other exploration data informs the estimate. characteristics; potential deleterious or contaminating substances. =============== =============================================================== ============================================================== Further work * The nature and scale of planned further work (e.g. * A programme of additional drilling will be planned tests for lateral extensions or depth extensions or subsequent to this phase of work to infill areas of large-scale step-out drilling). known mineralisation, and to further explore potential for mineralisation along strike and down dip of the known mineralisation. * Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive. =============== =============================================================== ==============================================================
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 * All data used in the Resource was provided by Zenit corrupted by, for example, transcription or keying as separate Excel drill hole files. The separate errors, between its initial collection and its use files have been transposed into a desurveyed for Mineral Resource estimation purposes. drillhole file for verification prior to Mineral Resource estimation. * Data validation procedures used. * Reports were generated to highlight potential transcription errors. =============== ============================================================ ================================================================== Site visits * Comment on any site visits undertaken by the * The Competent Person for this project is Mr. Joe Competent Person and the outcome of those visits. Hirst B.Sc., M.Sc., European Geologist (EurGeol) and Chartered Geologist (CGeol). Mr. Hirst is a Senior Resource Geologist and Competent Person as defined by * If no site visits have been undertaken indicate why the JORC code. Mr. Hirst will make a single visit to this is the case. the project in April 2018 and to verify aspects of the data collection and handling for the project. Geological interpretation * Confidence in (or conversely, the uncertainty of) the * Geological interpretation used a combination of geological interpretation of the mineral deposit. surface mapping data, geophysics and geological and geochemical boundaries from the drill holes across the Tavsan deposit. * Nature of the data used and of any assumptions made. * Interpretation was completed by Ariana geologists and * The effect, if any, of alternative interpretations on consultants, creating 3D wireframe models according Mineral Resource estimation. to geology and mineralisation above a 0.5 g/t Au cut-off. * The use of geology in guiding and controlling Mineral Resource estimation. * Geological Domains were interpreted for the deposit according to geology, grade and geotechnical structures. Six main mineralised lodes have been * The factors affecting continuity both of grade and identified. geology. * The mineralisation is well understood, typically to a single identifiable unit, and geologically constrained. * Grade continuity analysis within the interpreted mineralised zones has been robust. * The confidence in geological interpretation is appropriately reflected in the classification of the Resources. =============== ============================================================ ================================================================== Dimensions * The extent and variability of the Mineral Resource * The mineralisation follows a SW-NE trend where expressed as length (along strike or otherwise), plan outcrop occurs along the jasperoid unit contact. The width, and depth below surface to the upper and lower mineralisation is generally present at surface. The limits of the Mineral Resource. mineralised zone is approximately 3.6km wide across the SW-NE trend, and covers an area of approximately
7.70km(2) . * The mineralisation has an approximate true thickness of 6.7m, ranging between 1 and 30m thick. Estimation and modelling * The nature and appropriateness of the estimation * The Mineral Resources have been estimated into a techniques technique(s) applied and key assumptions, including block model prepared in Datamine Studio 3. The block treatment of extreme grade values, domaining, model comprises the following parameters: interpolation parameters and maximum distance of extrapolation from data points. If a computer assisted estimation method was chosen include a o Parent cell dimension of 10 m x description of computer software and parameters used. 20 m x 5 m (x, y, z) * A set of geological and Au grade based wireframe models were provided and prepared in Datamine to * The availability of check estimates, previous select the samples used in the estimation and to estimates and/ or mine production records and whether constrain the interpolation. the Mineral Resource estimate takes appropriate account of such data. * The Mineral Resources were compared to a previous estimate completed by SRK Consulting (UK) Ltd in * The assumptions made regarding recovery of 2008. Differences in the geological model, with by-products. emphasis placed on modelling within areas of the resource identified as having potential to be mined via open pit (as per 2016 Scoping Study), result in * Estimation of deleterious elements or other non-grade differences in the estimation. variables of economic significance (e.g. sulphur for acid mine drainage characterisation). * Grade estimates were based 1 m composited assay data. * In the case of block model interpolation, the block size in relation to the average sample spacing and * The interpolation of the element concentration was the search employed. undertaken using Ordinary Kriging. * Any assumptions behind modelling of selective mining * The resource estimation techniques are appropriate units. for the style of mineralisation. * Any assumptions about correlation between variables. * Only Au and Ag were estimated, no potentially deleterious elements or compounds were estimated. * Description of how the geological interpretation was used to control the resource estimates. * Density was estimated using Inverse Distance Weighting (IDW) to second power. * Discussion of basis for using or not using grade cutting or capping. * Top cut requirements were assessed, but deemed unnecessary. * The process of validation, the checking process used, the comparison of model data to drill hole data, and * Block model validation was completed using a full set use of reconciliation data if available. of statistical measures and plots, along with visual inspection on plan and section. =============== ============================================================ ================================================================== Moisture * Whether the tonnages are estimated on a dry basis or * Tonnage is estimated on a dry basis in accordance with natural moisture, and the method of with the specific gravity determination. determination of the moisture content. Cut-off parameters * The basis of the adopted cut-off grade(s) or quality * Au cut-off grades were applied based upon costs and parameters applied. recoveries established from the company's other operations. =============== ============================================================ ================================================================== Mining factors * Assumptions made regarding possible mining methods, * No assumptions were made regarding possible mining or assumptions minimum mining dimensions and internal (or, if methods as the mineralisation is at or near surface, applicable, external) mining dilution. It is always there should be no constraint on open-pit potential. necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider potential mining methods, but the assumptions made regarding mining methods and parameters when estimating Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the mining assumptions made. Metallurgical factors * The basis for assumptions or predictions regarding * Basic metallurgical assumptions were made with or assumptions metallurgical amenability. It is always necessary as regards to expected processing methods, recoveries part of the process of determining reasonable from test work completed by SGS and expected prospects for eventual economic extraction to throughputs. consider potential metallurgical methods, but the assumptions regarding metallurgical treatment processes and parameters made when reporting Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the metallurgical assumptions made. =============== ============================================================ ================================================================== Environmental factors * Assumptions made regarding possible waste and process * No environmental studies have been completed as part or assumptions residue disposal options. It is always necessary as of this assignment. It is understood that there will part of the process of determining reasonable be no environmental impediments to production. prospects for eventual economic extraction to consider the potential environmental impacts of the mining and processing operation. While at this stage the determination of potential environmental impacts, particularly for a greenfields project, may not 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 * Bulk density values have been estimated into the for the assumptions. If determined, the method used, block model using an inverse distance weighting whether wet or dry, the frequency of the measurements interpolation. The density estimate was based upon 7 , dry density determinations. 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 resource classification at the project considers Resources into varying confidence categories. the following criteria: * Whether appropriate account has been taken of all o Confidence in the sampling data relevant factors (i.e. relative confidence in and geological interpretation. tonnage/ grade estimations, reliability of input data o The data distribution (based upon , graphical analysis and average distance confidence in continuity of geology and metal values, to informing composites). quality, quantity and distribution of the data). o Grade continuity analysis. * The model was classified according to Joint Ore Reserves Committee of the Australasian Institute of * Whether the result appropriately reflects the Mining and Metallurgy (JORC) guidelines (JORC, 2012 Competent Person's view of the deposit. Edition). * The classification appropriately reflects the status of the resource development. Audits or reviews * The results of any audits or reviews of Mineral * An internal peer review was conducted for this study. Resource estimates. No external reviews or audits have been completed. =============== ============================================================ ================================================================== Discussion of relative * Where appropriate a statement of the relative * The resource estimate is deemed appropriately accuracy/ accuracy and confidence level in the Mineral Resource accurate globally, based upon the informing data. The confidence estimate using an approach or procedure deemed accuracy and global/ local basis of the resource appropriate by the Competent Person. For example, the estimate is suitably accounted for in the resource 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 * The composition of the mineralisation, and the grade discussion of the factors that could affect the of the block model accurately reflects bulk samples relative accuracy and confidence of the estimate. taken at the property for testwork. * 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. =============== ============================================================ ==================================================================
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