Ariana Resources plc: KIZILCUKUR FORESTRY PERMIT GRANTED FOR PRODUCTION

1 February 2017
AIM: AAU

KIZILCUKUR FORESTRY PERMIT GRANTED FOR PRODUCTION

Ariana Resources plc ("Ariana" or "the Company"), is pleased to announce the receipt of an operational forestry permit for the Kizilcukur Project.  Kizilcukur is located outside of the Red Rabbit joint venture with Proccea Construction Co. and is 100% owned by Ariana.  The project lies 22km to the northeast of the Kiziltepe mine site.

Highlights:

• Forestry permit granted to enable production from the Kizilcukur operating licence.

• Kizilcukur contains a current Mineral Resource of c.308,000 tonnes at 2.11g/t gold + 73.4g/t silver and demonstrates further growth opportunities.

• Potential for 18 months of add-on mine life for the Kiziltepe Mine from three shallow open-pits if Kizilcukur is developed as a satellite mine site.

• Mining permit in place until September 2022; a blasting permit will now be sought to enable trial mining to commence.

• Ariana retains the option to sell Kizilcukur to its joint venture company at three times the exploration cost.

Dr. Kerim Sener, Managing Director, commented: 

"We are very pleased to have received this forestry permit at this time.  As an integral part of our practical development strategy for our advanced projects, the Company will now be able to commence trial mining at the Kizilcukur site during 2017 and enable the stockpiling of material for future processing at Kiziltepe.  This trial mining exercise will fast-track this project through an internal feasibility study, with the aim of it becoming a satellite source of high-grade material for the Kiziltepe operations.

We look forward to providing the market with further updates on Kizilcukur during 2017 and particularly once we are in a position to initiate trial production." 

Details of the Kizilcukur Project

The Kizilcukur Project consists of one operational licence located in the Balikesir Province in Western Turkey (coordinates: 626150 m E; 4360440 m N). The property lies 22km to the northeast (straight line) and 50km by road from the Kiziltepe Sector of the Company's Red Rabbit Project. A royalty will be payable to Dogu Akdeniz Mineralleri San. ve Tic. Ltd. of 2% Net Smelter Return on commercial production from the Project.  Ariana has the option to sell the project to Zenit Madencilik San. ve Tic. A.S. (the operating company for the Kiziltepe Mine) at three times the exploration cost.

The Project covers an area containing a series of sub-parallel quartz veins hosted by ophiolitic units that trend northwest and extend for at least two kilometers. The Main Vein exhibits classic low-sulphidation epithermal features and attains a maximum true width of 8m. The western quartz vein extends over a strike length of 820m. Composite rock-chip sampling of 80m strike along this quartz vein returned encouraging assay results of 6m at 3.3 g/t gold, 2m at 9.6g/t gold and 1m at 7.2 g/t gold. The peak rock-chip assay result in this area was 152 g/t gold and 1,320 g/t silver.

A JORC 2012 compliant Mineral Resource estimate has been prepared for the Kizilcukur Project (Table 1) and Whittle optimization conducted in 2016 has identified the potential for the development of three open pits at this locality (Figure 1).  The Mineral Resource stands at c.308,000 tonnes at 2.11g/t gold + 73.4g/t silver and demonstrates potential for further growth with additional drilling.

The newly granted forestry permit (Figure 2) will enable trial mining to commence within the central part of the Zeki Pit.  This pit is the largest and highest grade of the three pits defined following Whittle optimisation of the Kizilcukur resource.  The General Directorate of Mining Affairs has pre-approved blasting operations on the licence as part of its Mining Permit (as announced on 18 November 2015) and a blasting permit will now be sought from local authorities to enable trial mining to commence in 2017.

Table 1: 2016 Kizilcukur JORC 2012 compliant Mineral Resource estimate, based on 17 diamond and 26 RC drill holes.  Gold equivalent is the sum of the gold ounces and the gold equivalent ounces of silver based on a price ratio of 60:1.

Figure 1: shows three-dimensional model of the Kizilcukur vein system looking due north, showing the modelled ore zones within Whittle optimised pit-shells and current drilling.

Link: http://hugin.info/138153/R/2074952/780124.pdf

Figure 2: shows map of the forestry permit within which preliminary mining operations may begin.  The outline of the 2016 Whittle optimised Zeki Pit is also shown for reference.  Selected shallow drilling intercepts are also shown along with the outline of the current resource as viewed from above.  The mineralised vein dips steeply to the south-west. 

Link: http://hugin.info/138153/R/2074952/780125.pdf

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

Contacts:

Ariana Resources plc	Tel: +44 (0) 20 7407 3616
Michael de Villiers, Chairman
Kerim Sener, Managing Director
Beaumont Cornish Limited	Tel: +44 (0) 20 7628 3396
Roland Cornish / Felicity Geidt
Beaufort Securities Limited	Tel: +44 (0) 20 7382 8300
Jon Belliss
Panmure Gordon (UK) Limited	Tel: +44 (0) 20 7886 2500
Adam James / Tom Salvesen

Editors' Note:

Competent Person

Dr Kerim Sener, BSc (Hons), MSc, PhD, is the Managing Director of Ariana Resources plc.  A graduate of the University of Southampton in Geology, he also holds a Master's degree from the Royal School of Mines (Imperial College, London) in Mineral Exploration and a doctorate from the University of Western Australia.  He is a Fellow of The Geological Society of London and has worked in geological research and mineral consultancy in Africa, Australia and Europe.  He has read and approved the technical disclosure in this regulatory announcement. 

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 developing a portfolio of prospective licences originally selected on the basis of its in-house geological and remote-sensing database. 

The Company's flagship assets are its Kiziltepe and Tavsan gold projects which form the Red Rabbit Gold Project.  Both 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, form part of a 50:50 Joint Venture with Proccea Construction Co.  The Kiziltepe Sector of the Red Rabbit Project is fully-permitted and is currently in construction.  The total resource inventory at the Red Rabbit Project and wider project area stands at c. 525,000 ounces of gold equivalent.  At Kiziltepe a Net Smelter Return ("NSR") royalty of up to 2.5% on future production is payable to Franco-Nevada Corporation.  At Tavsan an NSR royalty of up to 2% on future production is payable to Sandstorm Gold.

In north-eastern Turkey, Ariana owns 100% of the Salinbas Gold Project, comprising the Salinbas gold-silver deposit and the Ardala copper-gold-molybdenum porphyry among other prospects.  The total resource inventory of the Salinbas project area is c. 1 million ounces of gold equivalent.  A NSR royalty of up to 2% on future production is payable to Eldorado Gold Corporation.

Beaufort Securities Limited and Panmure Gordon (UK) 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.

Glossary of Technical Terms:

"Ag" the chemical symbol for silver;

"Au" the chemical symbol for gold;

"cut-off grade" The lowest grade, or quality, of mineralised material that qualifies as economically mineable and available in a given deposit. May be defined on the basis of economic evaluation, or on physical or chemical attributes that define an acceptable product specification;

"g/t" grams per tonne;

"Indicated resource" a 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;

"Inferred resource" a 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 has 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 that may be limited or of uncertain quality and reliability;

"JORC" the Joint Ore Reserves Committee;

"JORC 2012" is the current edition of the JORC Code, which was published in 2012.  After a transition period, the 2012 Edition came into mandatory operation in Australasia from 1 December 2013;

"m" Metres;

"oz" Ounces;

"t" Tonnes;

"Whittle" computer software that uses the Lerch-Grossman algorithm, which is a 3-D algorithm that can be applied to the optimisation of open-pit mine designs.  The purpose of optimisation is to produce the most cost effective and most profitable open-pit design from a resource block model.

Ends