Tavsan Mine Construction Update

RNS Number : 9018R

Ariana Resources PLC

03 March 2023

 

3 March 2023

AIM: AAU

TAVSAN MINE CONSTRUCTION UPDATE

Ariana Resources plc ("Ariana" or the "Company"), an AIM-listed mineral exploration and development company with gold mining interests in Europe, provides the following update on construction progress at the Tavsan Mine ("Tavsan" or "the Project").  The Project is operated by Zenit Madencilik San. ve Tic. A.S. ("Zenit") in partnership with Proccea Construction Co. and Ozaltin Holding A.S. and is 23.5% owned by Ariana.

The Company was recently made aware that a local court, the Kütahya Administrative Court, determined to rule in favour of a motion to temporarily suspend the construction activities of Zenit at the Tavsan mine site until a new expert report relating to the Environmental Impact Assessment ("EIA") is submitted to the court.  This motion has resulted in an interim decision ("the Decision") which provides a temporary stay on the provisions of the "Environmental Impact Assessment Positive" status of the Project issued by the Ministry of the Environment, Urbanisation and Climate Change, dating to 8 October 2021. 

Following the Decision, Zenit has determined to temporarily suspend construction activities at the Tavsan mine site to comply with the judgement.  However, various development activities which are not subject to the Decision are currently expected to continue in the vicinity, including local road displacements, water pipeline construction and boundary fence installation, in accordance with all applicable requirements and regulations.  In addition, drilling activities are currently continuing at the site with over 3,715m completed for 35 drill holes since the commencement of the most recent programme in November 2022.

The execution of the EIA provisions will now remain suspended until a future decision is made through the local court following the appointment of a new expert committee, the committee discovery process and the preparation of a new report for submission to the Kütahya Administrative Court.

Dr. Kerim Sener, Managing Director, commented:

"While this is disappointing news for the construction of our second mine at Tavsan, which will result in some delay to the completion of the mine, Zenit has determined to pursue its legal rights and to continue various development activities at the Project.  This situation is not at all unprecedented and several other operations have successfully progressed through similar hurdles.  We will provide further updates on this matter in due course, particularly once a new expert committee is appointed.  As Zenit has been funding the development of Tavsan through capital reserves and is not encumbered by debt, this delay will have no appreciable impact on our immediate financial capacity.  This allows us the opportunity to deal with this situation from a position of significant strength."

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").

Contacts:

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

Editors' Note:

About Ariana Resources:

Ariana is an AIM-listed mineral exploration and development company with an exceptional track-record of creating value for its shareholders through its interests in active mining projects and investments in exploration companies. Its current interests include gold production in Turkey and copper-gold exploration and development projects in Cyprus and Kosovo.

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

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

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

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

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

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

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

Panmure Gordon (UK) Limited is broker to the Company and Beaumont Cornish Limited is the Company's Nominated Adviser and Broker.

For further information on Ariana you are invited to visit the Company's website at www.arianaresources.com .

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