Kiziltepe study shows viable project

Ariana Resources plc has released the results of a definitive feasibility study on the Kiziltepe sector of its Red Rabbit gold project in Turkey.

Requiring initial capital of US$31.1 million, the project is estimated to provide an internal rate of return of 37.8% using a base case gold price of US$1,304/oz and US$22.50/oz for silver.

Proccea Construction Company is funding US$8 million to earn in to 50% of the project. 

Kerim Sener, Ariana’s managing director said: “Now that the feasibility is concluded, the company intends to advance discussions with potential lenders to the project.”

He added that first production is expected in the second half of calendar 2014.

The financial model is based on an eight-year mine life (including low-grade stockpile) and 1.19Mt selected pit reserve. The reserves lie within pits optimised and designed at a gold price of US$1,058/oz.