Ariana Resources says geophysical work at Kiziltepe gold prospect defined significant exploration up

Ariana Resources (AIM: AAU) is gearing up for an exploratory drilling campaign at its Kiziltepe gold prospect in Turkey after results from a geophysical programme located several anomalie, and defined a significant exploration upside on the prospect.

The company said that it has located several resistivity and chargeability anomalies that may coincide with buried vein systems to the northeast of the Arzu South vein and recorded one significant anomaly, which directly coincides with an area of extensive quartz vein float from which grades of up to 21.1 g/t (grammes per tonne) of gold.

The first phase of the drilling is set to commence this weekend, aiming to confirm the presence of these buried vein systems or their associated alteration.

An initial programme of drilling comprising several short test holes will be focused on three distinct trends that the anomalies coincided with, including one in the immediate vicinity of Arzu South, another beneath a hill which conceals part of the Arzu structure and one in the vicinity of the Vein 5 structure. Ariana plans to cover no more than 1,000 metres in the initial programme.

“These geophysical results coupled with systematic sampling have demonstrated the potential for further significant veins to be discovered at the Kiziltepe prospect. These geophysical anomalies will be targeted by exploration drilling. There is clear potential at the prospect to increase the current mineral resource and to further enhance the economics of the project,” said managing director Kerim Sener.

Kiziltepe and Ariana’s other prospect, Tavsan, have been merged in a project dubbed Red Rabbit. Last month, Ariana said that its proposed JV (joint venture) with Proccea Construction had made significant progress towards production at Red Rabbit, having completed a scoping study and an environmental scoping assessment along with preliminary designs of the processing plant.

The scoping study was based on an envisaged production of 150,000 tonnes of ore per annum over a mine life greater than five years.

Ariana is targeting in its revised geological resource model a total resource of vein and halo mineralisation at a 1 g/t cut-off as being between 1.4 Mt (million tonnes) and 1.7 Mt at gold grades between 2.5 and 3.5 g/t and silver grades between 50 and 70 g/t. The average in-pit resource grade is expected to be 3.5 to 4.5 g/t gold and 50 to 70 g/t silver.

The completion of the feasibility and environmental impact studies is expected in the final quarter of 2010, while mine and plant construction are set to kick off in Q1 2011.

Broker Daniel Stewart  & Co issued a note today, saying it views Ariana's latest announcement positively and would encourage investors to follow developments. The shares have generally traded in a narrow range between 3-3.5p this year, it added.

http://www.proactiveinvestors.com.au/companies/news/5978/ariana-resources-says-geophysical-work-at-kiziltepe-gold-prospect-defined-significant-exploration-up-5978.html