Chaarat Gold (LON:CGH), the gold exploration and development company working in the Kyrgyz Republic, has raised around £3.85m before expenses in a share placing priced at 40p per share. The new cash has been earmarked to fund work on the potential development of an early stage, low cost, partially open pit mine within the T0700 project area in the Tulkubash zone at the company’s 100% owned Chaarat Gold Project. In particular, Chaarat wants to carry out further drilling to increase and upgrade the resource in the Tulkubash zone as well as conduct the necessary studies and reports required for regulatory approval and production permits.

Drilling restarted in the Tulkubash zone in May 2010 and the company reported “encouraging” early results from that programme during June. Within the T0700 project area, a JORC compliant resource of 336,000 oz at a grade of 4.18 g/t has already been delineated. That forms part of the 4.009m ounce JORC compliant gold resource that covers the wider Chaarat project.

Dekel Golan, Chaarat’s chief executive, said: “The placing allows Chaarat to keep up its momentum as it progresses from a pure gold exploration company into a company focused on the development and production of the Chaarat Gold Project. I would like to express my gratitude to those existing shareholders who have continued to support Chaarat and assure them, as well as our new shareholders, that management will work ceaselessly to justify this trust and support.”

In June, Chaarat set out plans to complete a share for share acquisition of Kyrex Ltd, a private exploration company with four large licence areas in the north west of the Kyrgyz Republic. The three most prospective assets are Chontash, Mironovskoye and Kyzil Ompul.

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