27th October 2009
AIM / PLUS Markets: AAU
JOINT VENTURE TO DEVELOP SINDIRGI AND TAVSAN
Ariana Resources plc ("Ariana" or "the Company"), the gold
exploration and development company focused on Turkey is pleased to
announce a Memorandum of Understanding ("MoU") on a joint venture
("JV") agreement designed to advance the Company significantly
towards its goal of becoming a long term gold producer.
Highlights
* Good-will payment of US$0.5 million on signature of MoU
* 50-50 JV to develop the Sindirgi and Tavsan projects
* US$8 million funding to be committed to feasibility and plant
construction
Details of MoU
Shareholders will recall that in the Company's half-yearly report
released on 29 September 2009, Dr Kerim Sener, Managing Director,
explained that the Company was examining the feasibility of combining
its two principal projects, Sindirgi and Tavsan, into a single
conceptual entity - the Red Rabbit Project - and that it was
considering the development of this project as a joint venture with a
Turkish engineering firm.
The Company now announces that, through its operating subsidiary
Galata Madencilik San. ve Tic. Ltd., it has entered into a MoU with
Proccea Construction Co. ("Proccea"), an integrated Turkish turn-key
construction firm involved in a range of business sectors from gold
processing plants to major hotels. The MoU provides for the
negotiation of formal joint venture documentation which is expected
to lead to the establishment of a long term gold mining operation in
Turkey.
The JV agreement envisaged in the MoU is a 50-50 joint venture
between Ariana and Proccea to be formalised by the establishment of a
Turkish joint stock company which will hold and develop the assets.
Proccea will then be committed to fully-fund an Environmental Impact
Assessment and Feasibility Study on Red Rabbit and to commence
construction of the gold processing plant. By funding US$8 million,
Proccea will earn-in to its 50% share in the joint stock company. It
is intended that the additional capital requirements for plant
start-up may be met by a credit facility to be arranged by the
joint-stock company. On the successful commissioning of the plant,
profit share within the joint stock company will be 51% Ariana and
49% Proccea.
Under the terms of the MoU, Ariana will be paid within seven working
days US$0.5 million in cash which will be used at the Company's
discretion in exchange of a letter of guarantee valid for a term of
one year. However, should the parties to the MoU fail to reach
agreement on the signing of the formal joint venture documentation,
the Company will be obliged to return this cash sum in full with the
return of the letter of guarantee.
The implementation of the joint venture agreement is contingent upon
the outcome of approximately 90 days' due diligence, with a long stop
date for completion of the formal joint venture documentation of 180
days.
Dr. Kerim Sener, Managing Director, commented:
"The completion of this MoU with Proccea marks a major step forward
for Ariana. Our earlier trial mining at Kiziltepe demonstrated our
ability to produce gold in Turkey, providing the technical and
economic reassurance necessary to develop the Sindirgi and Tavsan
projects as a successful integrated entity - the Red Rabbit project.
We have identified a strong JV partner for funding the project
through the feasibility and construction stages, with a track record
of successful gold project development in Turkey. Their experience
in establishing many successful gold plants worldwide reflects their
high level engineering and operating skills and we are proud to enter
this partnership with them."
Mr. Deniz Aybars, Managing Director, Proccea, commented:
"We are very pleased to enter this partnership with Galata Madencilik
(the subsidiary of Ariana Resources plc in Turkey) and excited about
developing a Turkish gold mining venture. We look forward to
completing the JV agreement in the coming months and the start of
fruitful long term relations."
About Proccea
Proccea Construction Co. (www.proccea.com) is an integrated
construction firm specialising in turn-key solutions for a variety of
business sectors ranging from the development of gold processing
plants to designing and building major hotels. The mining service is
provided by a business division of Proccea named CH Engineering &
Consultancy ("CH"). CH provides a range of services to the mining
industry, including the design of mining equipment and processing
plants, manufacturing installation, commissioning, start-up and staff
training for gold and silver extraction in the mining industry
(www.chconsultants.com).
CH provides the installation and technical services for such gold
mining processes as heap leach, CIL and CIP design and operations.
CH has wide experience of designing and commissioning gold and silver
processing plants. In Turkey this has included the Kisladag gold mine
(Eldorado Gold), Copler gold mine (Anatolia Minerals), Mastra gold
mine (Koza Gold) and the G�m�sk�y silver mine (Eti G�m�s).
Internationally, CH processing plant commissions have included the
Zarcan gold mine in Iran, the Knelson gold mine in Kazakhstan, the
Amesmessa gold mine in Algeria, the Kitila gold mine in Finland, the
Minera Triton gold mine in Argentina and the Maaden gold mine in
Saudi Arabia. CH has the technical support of the internationally
renowned Summit Valley Equipment and Engineering firm based in Utah,
U.S.A.
Contacts:
Ariana Resources plc
Michael Spriggs, Chairman Tel: 020 7407 3616
Kerim Sener, Managing Director
Beaumont Cornish Limited Tel: 020 7628 3396
Roland Cornish
Alexander David Securities Limited Tel: 020 7448 9820
Nick Bealer / David Scott
Loeb Aron & Company Ltd Tel: 020 7628 1128
Peter Freeman / Frank Lucas
Editors' note:
About Ariana Resources
Ariana is an exploration and development company focused on
epithermal gold-silver and porphyry copper-gold deposits in Turkey.
The Company is exploring a portfolio of prospective licences selected
on the basis of its in-house geological and remote-sensing database,
on its own in western Turkey and in Joint Venture with European
Goldfields Limited in north-eastern Turkey.
The Company's flagship assets are its Sindirgi and Tavsan gold
projects. Both projects 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, are presently
being assessed as to their economic merits. The total resource
inventory of the Company stands at 401,000 ounces of gold
equivalent.
Loeb Aron & Company Ltd. and Alexander David Securities Limited are
joint brokers 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.
Ends
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