2019 Tulkubash Exploration and Drilling Programme

RNS Number : 5250C

Chaarat Gold Holdings Ltd

18 June 2019

 

18 June 2019

Chaarat Gold Holdings Limited

("Chaarat" or the "Company")

2019 Tulkubash Exploration and Drilling Programme Underway

Chaarat (AIM: CGH), the AIM-quoted gold mining company with assets in the Kyrgyz Republic and Armenia, is pleased to announce the first tranche of results from its 2019 exploration and drilling programme at its Tulkubash oxide gold deposit in the Kyrgyz Republic. 

Highlights

·    Over 3,800 metres of drilling completed; minimum of 20,000 metres scheduled to be completed in 2019.

·    Assays received from 16 drill holes. Significant intercepts are tabulated below.

·    2019 drilling to date has identified new shallow mineralisation within and adjacent to current pit outlines.

·    Roadcut and outcrop mapping and sampling confirm extensions of gold mineralisation northeast along strike confirming that Tulkubash hosts a significant gold system.

·    Based on the increasing evidence that Tulkubash is an emerging gold district, district-scale exploration is being accelerated.

2019 Objectives

·    Exceed 2 million ounces of gold in Measured and Indicated JORC Resource categories (currently 1.6 million ounces), thereby increasing reserve and extending mine life

·    Improve project economics within currently defined pits by adding ore within existing pit shells, reducing the strip ratio, and optimizing metallurgical recovery model

·    Increase understanding of district prospectivity

To date, 26 holes have been completed totalling 3,860 metres of a total 20,000 metre drilling programme scheduled for 2019. The drilling is focused on adding Measured and Indicated Resources, with potential for conversion into reserves as part of a year-end Resource and Reserve Update.

Of the planned 20,000 metres of drilling this year, the large majority (c.16,000 metres) will comprise exploration and step-out drilling from the current resource boundary. Much of this will test priority targets northeast along strike from the currently defined resource boundary and in previously undrilled zones adjacent to current satellite pit shells. Evidence to date suggests that both gold grade and oxidation state (which is indicative of metallurgical recovery) are improving along strike to the northeast. An extensive soil geochemical anomaly in this area, as well as favourable alteration, indicates that the Tulkubash Trend continues and indeed strengthens in this direction.

Approximately 2,000 metres of drilling have been allocated to an infill drilling programme within currently designed pit boundaries with the objective of converting waste to ore and improving project economics. A final 2,000 metres is allocated to initial reconnaissance drilling of high-grade targets up to five kilometres along strike from the current resource boundary, with the objective of validating the potential for more distal targets as part of the district-scale exploration, discussed in more detail below.

This link provides a plan showing the location of 2019 planned drilling at Tulkubash:

http://www.rns-pdf.londonstockexchange.com/rns/5250C_1-2019-6-17.pdf

Dorian L. (Dusty) Nicol, the Company's Senior Vice President Exploration, commented:

"We are very excited to have begun the exploration and drilling season at Tulkubash. Last year's programme discovered 650,000 ounces of gold in Measured and Indicated Resource categories at a discovery cost of $11.40 per ounce. We have every reason to expect similar or greater rates of success with this year's programme. Already drill results received to date have extended hanging wall mineralization in the Tulkubash Main Pit area and have discovered new mineralization in the "satellite pits" area northeast of the Main Pit. Of particular significance here is the 19.5 metres (15.5 metres true thickness) of 2.2 g/t Au in Hole DH19T478.  Now that the drill road and pad construction have extended northeast of the current resource boundary, we will be able to drill what we consider to be a highly prospective zone of geochemical anomalies, crackle breccia, and hydrothermal alteration identified by last year's mapping.

"Furthermore, we are very pleased to have been able to accelerate district-scale exploration this season. Field work is being integrated with satellite imagery and geochemical, geophysical, structural, and mineralogical alteration haloes around Tulkubash gold mineralization. Our objective is to continue developing a database of these geological data that will allow application of advanced data handling techniques (including Artificial Intelligence / Machine Learning) to optimize ongoing exploration and discovery."

Drill Results

The following table summarizes significant drill results obtained to date. Significant intercepts are defined as intercepts greater than 10m in width above a 0.25 g/t cut off or greater than 3m in width at a 0.25 g/t cut off assaying greater than 1.0 g/t Au. All results are from diamond core holes. The sample intervals are constrained by geology and range from a minimum of 0.4 metres to a maximum of 1.5 metres, generally averaging almost 1.5 metres in length. Mean grades are calculated at the stated cut off with no upper cap applied. The maximum length of internal waste in any interval is 3.0 metres. Approximate true width is estimated from cross sectional interpretations.

Drill Hole	Interval		Thickness (m)	True Thickness (m)	Au (g/t)
	From	To
DH19T466	114.00	130.50	16.50	9.70	1.49
incl	114.00	121.50	7.50	4.40	2.09
DH19T466	135.00	144.00	9.00	5.30	3.90
DH19T468	66.00	78.00	12.00	8.90	0.91
incl	69.00	73.50	4.50	3.00	1.78
DH19T473	36.00	39.00	3.00	2.70	1.07
DH19T473	60.00	82.50	22.50	20.25	0.94
DH19T467	111.00	117.00	6.00	4.50	1.12
DH19T470	94.00	112.00	18.00	16.00	0.81
DH19T478	27.00	46.50	19.50	15.50	2.20
DH19T474	105.00	111.00	6.00	5.10	2.77

The initial results of the 2019 drill program are encouraging. Previous wide spaced drilling in the Tulkubash main pit area suggested gold mineralization continued northwest of the current pit design. The first five holes this season were drilled on 80 metre spacing to test for the extension and continuity of this zone. Four of the holes intersected significant gold mineralization within the oxide zone that could result in an expansion of the northwest highwall of the main pit and add to reserves.

Initial results from drilling along the northeast extension of the Tulkubash Trend have returned positive results with the identification of shallow high-grade gold lodes extending between the Satellite pit area and the East Pit. This new mineralisation may expand and combine the small pits into larger designs with improved project economics.

The following link tabulates the drill results received to date and illustrates the drill hole locations and interpretive cross-sections:

http://www.rns-pdf.londonstockexchange.com/rns/5250C_1-2019-6-17.pdf

District-Scale Exploration

It is becoming increasingly apparent that Tulkubash is an emerging gold district, with the potential to host a cluster of gold deposits. The current resource of 1.6 million ounces of gold discovered to date is located within approximately 4.0 kilometres of a 24-kilometrestrike length of favourable geology. Reconnaissance work to date indicates that the favourable geology along this strike length is associated with multiple occurrences of anomalous gold geochemistry, favourable structural geology (crackle brecciation), and favourable hydrothermal alteration.

For example, reconnaissance mapping in 2018 disclosed strong silicification within the favourable Tulkubash host rocks, approximately three kilometres from the current resource boundary. Trenching within these zones returned oxidized gold mineralization including 13.0 metres of 1.27 g/t Au and 26.0 metres of 2.02 g/t Au. These trench results occur within a large gold-in-soil geochemical anomaly and confirm in-situ gold mineralisation within these anomalies. Initial ground reconnaissance and air photo / satellite image interpretation is currently identifying multiple additional targets for follow-up.

Tulkubash gold mineralization occurs within a northeast-trending structural zone that is characterized by strong silicification and brecciation. Reconnaissance mapping and geochemical exploration indicates that this zone extends to the northeast for at least 15 kilometres where the trend intersects a granitic intrusive body. These intrusive rocks are associated with skarn gold mineralisation that may be related to a shallow porphyry system, which may represent additional targets in themselves. Exploration management believes that these intrusive rocks may have provided the heat source for the Tulkubash mineralization, in which case the intensity of mineralization could be expected to increase approaching this zone.

In order to cost-effectively accelerate district-scale exploration without losing focus on the short-term need to add resource and mine life to the Tulkubash oxide gold deposit, the Company is planning a staged programme comprising the following steps:

·    Summer 2019: Reconnaissance traverses for geologic mapping and geochemical sampling to prioritize areas for future follow-up. This work will be supported by the use of drones to visually inspect terrain in search of alteration, brecciation, and other potential indicators of mineralisation to identify specific areas to target. In addition, a remote sensing study using multi-spectral satellite images is being conducted to identify potential areas of mineralisation by identifying the spectral signature of known mineralisation and looking for areas with similar signatures throughout the Exploration License.  Several such targets have already been identified for follow-up.

·    Winter 2019/2020: Further satellite image interpretation taking advantage of "ground truthing" and calibration of this technique during the 2019 field season. Integration of digitized data with geologic (particularly structural) and geochemical data into a layered database. The goal is to develop a database that will allow application of advanced data handling (Artificial Intelligence / Machine Learning) to recognize signatures of mineralisation and optimize drill target identification.

·    Summer 2020: More aggressive field work following up on targets generated by previous work, including drilling where warranted.

Ongoing exploration will continue focusing on adding reserves and mine life to the Tulkubash oxide gold deposit, with the objective of demonstrating a minimum 15-year mine life. In addition, the Company will continue its district-scale exploration with the objective of discovering additional, new gold orebodies and new mines. 

http://www.rns-pdf.londonstockexchange.com/rns/5250C_1-2019-6-17.pdf

QA/QC Procedures: Sampling Methodology and Quality Control

All results have been generated from diamond core holes. Samples are shipped to the ALS Global Laboratory in Kara-Balta, Kyrgyz Republic for sample preparation and assay. Gold is analysed using a 30-gramme fire assay with an atomic absorption spectroscopy (AAS) finish. A quality control/quality assurance protocol is employed in the programme which includes standards and blanks in every batch of assays. Check assays are conducted on every 20^th sample by a second independent laboratory.

Competent Person

The Competent Person with overall responsibility for this press release for the Company, and who has reviewed the information contained herein, is Dorian L. (Dusty) Nicol (FAussIMM), the Company's Senior Vice President Exploration. He is a geologist with more than 44 years of experience in the resource industry who has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. He has supervised the work which is the subject of this release. Mr. Nicol consents to the inclusion in this announcement of the matters based on this information in the form and context in which it appears.

Enquiries

Chaarat Gold Holdings Limited
Artem Volynets (CEO)	[phone]
	[e-mail]
Numis Securities Limited
John Prior, Paul Gillam (NOMAD)	[phone]
James Black (Corporate Broking)
Powerscourt
Conal Walsh	[phone]
Sam Austrums	[e-mail]

About Chaarat

Chaarat is a gold mining company which owns the Kapan operating mine in Armenia as well as Tulkubash and Kyzyltash Gold Projects in the Kyrgyz Republic. The Company has a clear strategy to build a leading emerging markets gold company with an initial focus on Central Asia and the FSU through organic growth and selective M&A.

Chaarat is engaged in active community engagement programmes to optimise the value of the Chaarat investment proposition.

Chaarat aims to create value for its shareholders, employees and communities from its high-quality gold and mineral deposits by building relationships based on trust and operating to the best environmental, social and employment standards. Further information is available at www.chaarat.com.

Appendix - 2019 Drill hole intercepts (>0.25 g/t Au cut-off)
 

Drill		Interval		Thickness	True Thickness	Au
Hole	Cross Section	From	To	(m)	(m)	g/t
DH19T465	360	0.00	3.00	3.00	2.00	0.32
DH19T466	480	39.00	43.50	4.50	2.80	0.63
DH19T466	480	114.00	130.50	16.50	9.70	1.49
incl	480	114.00	121.50	7.50	4.40	2.09
DH19T466	480	135.00	144.00	9.00	5.30	3.90
DH19T466	480	159.00	163.50	4.50	2.40	0.44
DH19T468	560	31.50	33.00	1.50	1.00	0.35
DH19T468	560	66.00	78.00	12.00	8.90	0.91
incl	560	69.00	73.50	4.50	3.00	1.78
DH19T473	560	36.00	39.00	3.00	2.70	1.07
DH19T473	560	48.00	49.50	1.50	1.36	1.07
DH19T473	560	60.00	82.50	22.50	20.25	0.94
DH19T473	560	99.00	105.00	6.00	0.00	0.34
DH19T473	560	126.00	129.00	3.00	0.00	0.57
DH19T473	560	141.00	145.50	4.50	0.00	0.67
DH19T473	560	157.50	159.00	1.50	0.00	0.27
DH19T467	720	3.00	4.50	1.50	1.00	0.27
DH19T467	720	66.00	67.50	1.50	1.00	1.47
DH19T467	720	93.00	99.00	6.00	4.50	0.29
DH19T467	720	105.00	106.50	1.50	1.00	0.70
DH19T467	720	111.00	117.00	6.00	4.50	1.12
DH19T467	720	121.50	123.00	1.50	1.00	0.26
DH19T467	720	156.00	168.00	12.00	9.00	0.30
DH19T467	720	160.50	168.00	7.50	9.00	0.38
DH19T470	3600	35.50	37.00	1.50	1.40	0.27
DH19T470	3600	94.00	112.00	18.00	16.00	0.81
DH19T470	3600	121.00	127.00	6.00	5.60	0.71
DH19T478	3800	10.50	13.50	3.00	2.30	0.40
DH19T478	3800	19.50	22.50	3.00	2.30	0.49
DH19T478	3800	27.00	46.50	19.50	15.50	2.20
DH19T474	4280	0.00	6.00	6.00	5.25	0.65
DH19T474	4280	33.00	36.00	3.00	2.65	0.58
DH19T474	4280	105.00	111.00	6.00	5.10	2.77
DH19T475	4360	133.50	136.50	3.00	2.60	0.98

# Bold rows - significant intercepts

Glossary of Technical Terms

"Au"	chemical symbol for gold
"Breccia"	A rock composed of fragments of rocks cemented by a finer-grained matrix
"Crackle Breccia"	A breccia in which the fragments have not been rotated with respect to one another
"cut off"	the lowest grade value that is included in a resource statement.  It must comply with JORC requirement 19: "reasonable prospects for eventual economic extraction" the lowest grade, or quality, of mineralised material that qualifies as economically mineable and available in a given deposit. It may be defined on the basis of economic evaluation, or on physical or chemical attributes that define an acceptable product specification
"g/t"	grammes per tonne, equivalent to parts per million
"Inferred Resource"	that 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 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 which may be limited or of uncertain quality and reliability
"Indicated Resource"	that 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
"Intrusive Rock"	A rock formed from cooling magma that cooled below the surface of the earth. As opposed to a volcanic rock which cools from magma on the surface.
"JORC"	The Australasian Joint Ore Reserves Committee Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves 2012 (the "JORC Code" or "the Code"). The Code sets out minimum standards, recommendations and guidelines for Public Reporting in Australasia of Exploration Results, Mineral Resources and Ore Reserves
"koz"	thousand troy ounces of gold
"Measured Resource"	that 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 drill holes. The locations are spaced closely enough to confirm geological and grade continuity
"Mineral Resource"	a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories when reporting under JORC
"Mt"	million tonnes
"oz"	troy ounce (= 31.103477 grammes)
"Porphyry"	A large mineral deposit (often gold-copper) that forms in the final stages of cooling of certain intrusive rocks
"Reserve"	the economically mineable part of a Measured and/or Indicated Mineral Resource
"Silicification"	The addition of silica to a rock as part of the ore forming process
"Skarn"	A usually high-grade mineral deposit (often gold-copper) that forms when certain intrusive rocks are emplaced into limestones, which react chemically with the magma
"t"	tonne (= 1 million grammes)

 

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