Ariana Resources PLC ARZU SOUTH DRILLING RESULTS (0540X)

TIDMAAU

RNS Number : 0540X

Ariana Resources PLC

17 December 2019

17 December 2019

AIM: AAU

ARZU SOUTH DRILLING RESULTS

Ariana Resources plc ("Ariana" or "the Company"), the AIM-listed exploration and development company, is pleased to announce recent resource drilling results obtained from the Kiziltepe Mine ("Kiziltepe" or "the Project"). Kiziltepe 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:

-- Recent exploration drilling to test for deeper extensions of Arzu South included 16m @ 3.04 g/t Au + 67 g/t Ag and 3m @ 6.25 g/t Au + 129 g/t Ag.

-- Top historical intercepts from three zones of drilling beyond the Arzu South open-pit include 20m @ 3.16 g/t Au + 31 g/t Ag, 8m @ 3.95 g/t Au + 79 g/t Ag and 9m @ 2.37 g/t Au + 126 g/t Ag.

-- Potential for secondary structures associated with Arzu South, in the hangingwall and footwall are highly probable: Arzu South Parallel is a specific example.

   --     Revised resource estimates for Kiziltepe are due to be completed during Q1 2020. 

Dr. Kerim Sener, Managing Director, commented:

"These drilling results demonstrate the continuity of the Arzu South mineralised structure at depth which may form the basis for establishing an underground mineral resource. The structure clearly extends to a depth of about 50-100m beneath the bottom of the current open pit. Grades and widths of gold mineralisation encountered suggest that this structure has the potential to be developed via underground mining methods, although additional drill-testing is now warranted to determine the extent of this opportunity.

"We look forward to planning this follow-up drilling and also to undertake a new resource estimate for the Kiziltepe Mine, encompassing areas drill-tested in the past year and including all known veins. We are expecting to conclude this resource estimation work during Q1 2020, with a view to identifying opportunities to extend mine life beyond the eight years determined in the Feasibility Study."

Drilling Programme

During the summer of 2019, the Ariana exploration team completed a Reverse Circulation (RC) programme of resource infill drilling over the Arzu South, Derya and Arzu North vein systems within the Kiziltepe Sector of the Red Rabbit Project area. The programme focused on progressively increasing the resources at Kiziltepe, and was initiated in July 2019, aiming to achieve three primary objectives:

1) Complete infill drilling at the eastern end of the Derya resource prior to the commencement of mining in Q4 2019.

2) Complete additional drilling at Arzu North, following the results from May 2019, to test for probable extensions to the NW and to the SE.

3) Conduct initial testing for any underground potential at Arzu South to support an underground resource estimation.

A total of 3,162 meters of RC drilling for 25 holes was completed during this latest phase of drilling. Samples from the programme were submitted to the mine site laboratory for fire assay analysis for gold and silver only.

Results from Objective 1 and Objective 2 were announced on the 17 October and 18 November 2019 respectively. All results from Objective 3 have now been processed by the Zenit laboratory and checked by the Ariana team. A total of 2,150 meters of samples were assayed at the onsite laboratory for all three objectives. Of this, 624 meters of samples from 10 holes were from Arzu South (Table 1).

Drilling at Arzu South, from within and outside of the existing open pit, was designed to infill historic drill data (Table 2) to assist the definition of an underground resource up to 100m below the current planned pit. To date, there are now 44 drill holes intercepting mineralisation to a maximum depth of approximately 200m below surface (120m below final planned pit). Results from the latest round of drilling include (Table 1):

   --     KTP-RC02-19: 16m @ 3.04 g/t Au + 67 g/t Ag (30 meters below final pit). 
   --     KTP-RC03-19: 2m @ 3.33 g/t Au + 110 g/t Ag (60 meters below final pit). 

The true thickness of the Arzu South vein below the current pit varies according to depth and the orientation of plunging shoots. The average thickness ranges from 2-4 meters within the first 50 meters below the planned pit. On deeper intercepts (50-100m below current pit) the average vein thickness ranges from 0.5m to 1.6m, however, locally throughout the Arzu South structure, there are numerous plunging shoots, where true vein thickness can vary from 5-8 meters. These are high priority areas for future drill testing.

In addition to the Arzu South primary vein, there are numerous subsidiary veins within the Arzu South mineralisation and alteration envelope, which may also be considered targets for underground resource development. Most notably, drill-hole KTP-RC08-19, intercepted 3m @ 6.25 g/t Au + 129 g/t Ag approximately 40 meters to the north of the existing northern pit wall. Additional sampling from KTP-RC09-19 will be completed as soon as possible to determine the potential continuity of this structure along strike and at depth. Currently, there is insufficient data to incorporate the subsidiary veins into the pending underground resource, but future drilling programmes will be designed to test for these additional structures.

The drilling completed this year, in addition to all historic drilling, provides sufficient density of data points to complete an underground resource estimation and specifically within the first 50 meters below the Arzu South final planned pit. Within 50 meters below pit, the drill holes are on average spaced approximately 45 meters apart, with a minimum spacing of 20 meters, and a maximum of 90 meters. Additional drilling, currently planned to be completed from 2020, will aim to define potentially economic mineralisation up to 100 meters below the current planned pit.

http://www.rns-pdf.londonstockexchange.com/rns/0540X_1-2019-12-16.pdf

Figure 1: Long-section of the Arzu South Vein, showing certain recent and historic drilling results and the outline of the current Arzu South pit. The position of long-section line X-Y is shown in the top inset plan (showing the open pit) and the bottom inset long-section shows the true thickness of the vein with orange to red indicating a width greater than 4m (the position of the open pit is also shown).

http://www.rns-pdf.londonstockexchange.com/rns/0540X_1-2019-12-16.pdf

Figure 2: Schematic cross-section of the northwest end of Arzu South. KTP-RC08 intercepted mineralisation outside of the pit, to the north of the northern pit wall.

Table 1: Significant intercepts calculated for drilling on the Arzu South Vein, using a 1 g/t Au minimum cut-off and allowing for up to 1m internal dilution.

 
   Hole ID      From (m)   To (m)   Interval   Grade Au (g/t)   Grade Ag (g/t) 
                                       (m) 
 KTP-RC01-19       90        92        2            1.39             107 
               ---------  -------  ---------  ---------------  --------------- 
 KTP-RC02-19       51        54        3            1.37              20 
-------------  ---------  -------  ---------  ---------------  --------------- 
                   57        73        16           3.04              67 
-------------  ---------  -------  ---------  ---------------  --------------- 
                   75        76        1            1.00              19 
-------------  ---------  -------  ---------  ---------------  --------------- 
 KTP-RC03-19       98       100        2            3.33             110 
               ---------  -------  ---------  ---------------  --------------- 
 KTP-RC04-19       41        42        1            3.40             195 
               ---------  -------  ---------  ---------------  --------------- 
 KTP-RC05-19       18        19        1            1.12              0 
-------------  ---------  -------  ---------  ---------------  --------------- 
                   29        30        1            1.05              3 
-------------  ---------  -------  ---------  ---------------  --------------- 
                   40        41        1            1.30              80 
               ---------  -------  ---------  ---------------  --------------- 
                   45        47        2            1.95             121 
               ---------  -------  ---------  ---------------  --------------- 
                   73        74        1            1.70              36 
-------------  ---------  -------  ---------  ---------------  --------------- 
 KTP-RC07-19      131       132        1            1.05              58 
               ---------  -------  ---------  ---------------  --------------- 
 KTP-RC08-19       54        57        3            6.25             129 
-------------  ---------  -------  ---------  ---------------  --------------- 
                  128       129        1            3.34             105 
-------------  ---------  -------  ---------  ---------------  --------------- 
                  131       132        1            1.00              46 
-------------  ---------  -------  ---------  ---------------  --------------- 
 KTP-RC10-19      125       127        2            1.83              25 
               ---------  -------  ---------  ---------------  --------------- 
 

Table 2: Selected intercepts (including previously reported drilling results) calculated for drilling on the Arzu South Vein for each of the three zones, using a 1 g/t Au minimum cut-off and allowing for up to 1m internal dilution.

 
                         From            Interval   Grade       Grade 
 Zone    Hole ID          (m)   To (m)    (m)        Au (g/t)    Ag (g/t) 
   A     KTP-RC07-15      66      86        20        3.16        30.85 
        --------------  -----  -------  ---------  ----------  ---------- 
  KTP-RC08B-16            98     107        9         4.44        88.88 
 ---------------------  -----  -------  ---------  ----------  ---------- 
  KTP-RC49-16             53      58        5         5.32        30.08 
 ---------------------  -----  -------  ---------  ----------  ---------- 
   B     KTP-RC02-19      57      73        16        3.04        66.69 
        --------------  -----  -------  ---------  ----------  ---------- 
  KTP-RC05-15             92     100        8         3.95        79.38 
 ---------------------  -----  -------  ---------  ----------  ---------- 
  KTP-D07B-06            81.8    88.5      6.7        3.58        33.73 
 ---------------------  -----  -------  ---------  ----------  ---------- 
  KTP-RC05-15             92     100        8         3.95        79.38 
 ---------------------  -----  -------  ---------  ----------  ---------- 
   C     KTP-D03-18       78      87        9         2.37       126.44 
        --------------  -----  -------  ---------  ----------  ---------- 
  KT07                   219     220       1.3        4.25         1.6 
 ---------------------  -----  -------  ---------  ----------  ---------- 
  KTP-RC01-19             90      92        2         1.39         107 
 ---------------------  -----  -------  ---------  ----------  ---------- 
 

Sampling and Assaying Procedures

Samples from this drilling programme were produced from a 5 3/4 inch Reverse Circulation RC hammer. Samples and duplicates were split every meter into independent calico bags via a sample splitter incorporated into the rig cyclone. Intervals of interest, identified by logging and pXRF analysis, were organised into batches in line with Ariana's quality control procedures. For Arzu South, a total of 739 samples were submitted (including 115 QA/QC samples), to the Kiziltepe Mine Laboratory for fire assay gold-silver analysis.

Drill recoveries for all mineralised intercepts exceeded 90% recovery. All samples were assayed at the mine laboratory using a 30g fire assay. Samples were analysed in line with normal operating procedures for grade control analysis conducted for the Kiziltepe open pit. The addition of blanks, standards and duplicates were routinely included into the sample batches as part of Ariana's sampling procedures in adherence to the 2012 JORC Code. To add additional confidence to the mine laboratory analysis, 90 meters of mineralised material for the whole programme was sent as duplicate material to ALS Global in Izmir for 50g gold-silver fire assay and multi-element ICP. Quality control checks have determined that blanks and standards passed and duplicate samples showed good correlations. Laboratory sample preparation, assaying procedures and chain of custody are appropriately controlled. The Company maintains an archive of remaining RC chip samples and a photographic record of all chip-trays for future reference.

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

Contacts:

 
 Ariana Resources plc              Tel: [phone] 
                                    3616 
 Michael de Villiers, Chairman 
 Kerim Sener, Managing Director 
 
 Beaumont Cornish Limited          Tel: [phone] 
                                    3396 
 Roland Cornish / Felicity Geidt 
 
 Panmure Gordon (UK) Limited       Tel: [phone] 
                                    2500 
 Atholl Tweedie / James Stearns 
 
 Yellow Jersey PR Limited          Tel: [phone] 
                                    9512 
 Dom Barretto / Harriet Jackson    [e-mail] 
  / Henry Wilkinson 
 

Editors' Note:

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

About Ariana Resources:

Ariana is an 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 (as at end-2017). 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 (as at end-2017). 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" chemical symbol for silver;

"Au" chemical symbol for gold;

"g/t" grams per tonne;

"JORC" the Joint Ore Reserves Committee;

"m" Metres;

"oz" Troy ounces;

Ends.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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December 17, 2019 02:00 ET (07:00 GMT)