1st Apr 2015 09:52
LONDON (Alliance News) - Metal Tiger PLC and Ariana Resources PLC Wednesday said the scoping study for the Salinbas project in Turkey has been completed, yielding "positive results".
The scoping study was based on around 650,000 ounces of indicated and inferred gold resources with an average grade of 2.0 grammes of gold per tonne and 10.2 grammes of silver per tonne and was undertaken by independent geological, metallurgical and mining consultants.
The results show "potential for strong financial returns" with a net present value of USD108 million, with a payback period of 3.3 years at a gold price of USD1,250 per ounce and a cash cost of around USD768 per ounce, according to the study. Gold is currently trading at around USD1,182 per ounce.
The average life of mine production at the project is expected to be around 50,000 ounces of gold and 100,000 ounces of silver per year over ten years.
Ariana holds a 49% stake in the project, and Metal Tiger invested GBP75,000 for 8.3 million shares in Ariana at a price of 0.9 pence per share in February. Metal Tiger was also issued with 8.3 million warrants to subscribe for new shares in Ariana within a three-year period at an exercise price of 1.8 pence per share.
Capital expenditure for the project is expected to total around USD53.3 million.
"This is an excellent result which fully underpins the value of our Joint Venture strategy in Turkey. The scoping work demonstrates the significant development potential of the project, in parallel with the considerable additional exploration upside that exists in the region," said Kerim Sener, managing director of Ariana Resources.
Ariana shares were up 7.1% to 0.900 pence Wednesday morning whilst Metal Tiger shares were up 0.5% to 0.779 pence.
By Joshua Warner; [email protected]; @JoshAlliance
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