REG - Chaarat Gold Hlgs Ld - Strong Metallurgical Test Results on Kyzyltash Ore

Chaarat Gold HoldingsAnnouncement

23/08/2022 07:00

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RNS Number : 8317W  Chaarat Gold Holdings Ltd  23 August 2022

23 August 2022

Chaarat Gold Holdings Limited

("Chaarat" or the "Company")

Strong Metallurgical Test Results on Kyzyltash Ore

 

Chaarat Gold (AIM: CGH), the AIM-quoted gold mining company with an operating
mine in Armenia, and assets at various stages of development in the Kyrgyz
Republic, is pleased to announce the completion of the first phase
metallurgical test programme performed by SGS Lakefield on its Kyzyltash gold
project. The project has a current JORC-compliant Measured, Indicated and
Inferred sulphide resource of 5.4 million ounces of gold at 3.8 g/t.
Management estimate that the project has the potential to produce
approximately 300koz per annum of gold subject to the project meeting its
feasibility, permitting and development milestones.

 

The metallurgical test work has shown similar first stage recoveries from both
pressure oxidation ("POX") and Albion(TM) technologies. The Albion(TM) process
employs ultra-fine grinding followed by aerated cyanide leaching to extract
gold while POX uses high-pressure and temperature conditions to oxidize
refractory sulphides prior to gold extraction by conventional carbon-in-leach
technology. Bio-oxidation ("BIOX") test work is ongoing with results expected
in Q3 2022. The test work will be analysed in an economic trade-off study
comparing the potential processing technologies applicable to the ore with the
aim of making a final decision in 2023. Following this, Chaarat will aim to
progress towards an updated feasibility study on the Kyzyltash project.

 

Highlights of the Metallurgical Testing Programme

-    SGS Lakefield performed flotation and oxidative treatment tests on the
representative samples of the 2021 Kyzyltash drilling programme

-    Ore shown to be amenable to froth flotation recovering 87-90% of gold
with a 23-24% mass pull.

-  Leach recovery for both Albion(TM) and POX averaged 80-90% with similar
results between the two processes.

Next Steps

-      Results on oxidative testwork using BIOX are expected in Q3 2022.

-     Further investigation and variability testing will be performed on
all processing options to confirm the first stage results thereafter.

-   Final test results will be used to conduct an economic trade-off study to
determine the preferred processing option. This study will include an
assessment on flotation and full ore processing options before proceeding with
other workstreams required towards an updated feasibility study.

 

Mike Fraser, Chief Executive Officer of Chaarat, said:

 

"The development of the Kyzyltash project is continuing as planned. These
first results of the Kyzyltash metallurgical test work have provided
confirmation that the gold is favourably recoverable with various
technologies. The fact that the results from the Albion(TM) process were
similar to POX is very encouraging as Albion(TM) could potentially offer a
substantially simpler, lower cost means of processing Kyzyltash ore. Further
testwork to confirm the preferred processing route will enable Chaarat to
proceed with an updated feasibility study with the aim of unlocking the
significant future value that this project can bring to Chaarat shareholders.
Moreover, there exist significant synergies between Kyzyltash and the
construction ready Tulkubash open pit oxide leach project which lies in the
same licence area and has already proved its merits on a standalone basis. On
a combined basis these two projects have the potential to develop into a
significant long-life gold producing hub with the potential for further
exploration upside."

 

 

The Kyzyltash Development Project

Chaarat is developing the Kyzyltash gold deposit in the Kyrgyz Republic. The
deposit hosts a refractory, unconstrained resource of approximately 5.4 Moz
gold at 3.8 g/t. More than 80,000 metres of drilling have been completed to
date on the project and the current resource has been defined over 4 km of
strike length within favourable geology that could extend over more than 12 km
of strike length. In 2016 NFC (China Nonferrous Metal Industry's Foreign
Engineering and Construction Co. Ltd) subsidiary NERIN completed a definitive
feasibility study to Chinese standards assuming $565 million in capital
expenditure for an underground mine and a BIOX processing facility with ca.
75% recovery leading to an NPV(8) of $911 million based on a $1,750/oz gold
price.

The Kyzyltash sulphide gold deposit is in the same licence area as the
Tulkubash. Kyzyltash represents the next stage of development for Chaarat in
the Kyrgyz Republic which targets to deliver 500 koz p.a. group production
through organic growth.

 

The Kyzyltash Metallurgical Drilling and Testwork Programme

The 2021 Kyzyltash metallurgical drill programme consisted of 16 twin drill
holes totalling 3,508 metres. Drill hole locations were selected to provide
sufficient material of appropriate tonnage and grade to represent the Main and
Contact Zones of the Kyzyltash deposit. Sampling was conducted using large, PQ
diameter core to ensure enough core was available for subsequent metallurgical
testing.

In order to proceed to an updated feasibility study in accordance with global
standards, no further drilling is required on the measured and indicated
resource whereas management currently expects ca. 10 km of drilling to be
required to upgrade the existing inferred resources to measured and indicated
categories.

 

Sampling

The material for testing was collected from the diamond drilling program in
the major mineralised areas of the deposit known as the Main and Contact
Zones. A total of 395 metres of mineralised core yielded 2,300 kg of material
for the current programme in addition to future variability and pilot plant
test work.  Master composites for the Main and Contact Zones were prepared
for testing, grading 2.5 g/t Au and 3.6 g/t Au respectively. The material is
considered representative of the potentially minable portion of the deposit by
both SGS and Chaarat.

 

Diagnostic Leaching & Mineralogy

Diagnostic leaching of flotation concentrate indicated maximum theoretical
recoveries of between 75% and 86% based on area within the deposit. Diagnostic
leaching of flotation tails indicated theoretical maximum recoveries of 90%
and 93%, confirming that processing whole ore rather than concentrate will
offer a significant increase in recovery. The assessment of flotation versus
full ore treatment will be considered during the trade-off study.

 

 

 Enquiries

 Chaarat Gold Holdings Limited                       +44 (0)20 7499 2612
 Mike Fraser (Chief Executive Officer)               IR@chaarat.com (about%3Ablank)

 Canaccord Genuity Limited (NOMAD and Joint Broker)  +44 (0)20 7523 8000
 Henry Fitzgerald-O'Connor
 James Asensio

 finnCap Limited (Joint Broker)                      +44 (0)20 7220 0500
 Christopher Raggett

 Panmure Gordon (UK) Limited (Joint Broker)          +44 (0)20 7886 2500
 John Prior

 Hugh Rich

 

About Chaarat

Chaarat is a gold mining company which owns the Kapan operating mine in
Armenia as well as Tulkubash and Kyzyltash Gold Projects in the Kyrgyz
Republic. The Company has a clear strategy to build a leading emerging markets
gold company through organic growth and selective M&A.

 

Chaarat aims to create value for its shareholders, employees and communities
from its high-quality gold and mineral deposits by building relationships
based on trust and operating to the best environmental, social and employment
standards. Further information is available at www.chaarat.com/
(about%3Ablank) .

 

 

Glossary of Technical Terms

 

 "g/t"                 grammes per tonne, equivalent to parts per million

 "FA / ICP 35"         Fire Assay gold assay method / Inductively Coupled Plasma is a multi-element
                       analytical method for determination of the element content in materials, used
                       to assay silver, base metals etc.
 "Inferred Resource"   that 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 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
                       which may be limited or of uncertain quality and reliability

 "Indicated Resource"  that 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

 "JORC"                The Australasian Joint Ore Reserves Committee Code for Reporting of
                       Exploration Results, Mineral Resources and Ore Reserves 2012 (the "JORC Code"
                       or "the Code"). The Code sets out minimum standards, recommendations and
                       guidelines for Public Reporting in Australasia of Exploration Results, Mineral
                       Resources and Ore Reserves

 "koz"                 thousand troy ounces of gold

 "Measured Resource"   that part of a Mineral Resource for which tonnage, densities, shape, physical
                       characteristics, grade and mineral content can be estimated with a high level
                       of confidence. It is based on detailed and reliable exploration, sampling and
                       testing information gathered through appropriate techniques from locations
                       such as outcrops, trenches, pits, workings and drill holes. The locations are
                       spaced closely enough to confirm geological and grade continuity

                       a concentration or occurrence of material of intrinsic economic interest in or

                     on the Earth's crust in such form, quality and quantity that there are
 "Mineral Resource"    reasonable prospects for eventual economic extraction. The location, quantity,
                       grade, geological characteristics and continuity of a Mineral Resource are
                       known, estimated or interpreted from specific geological evidence and
                       knowledge. Mineral Resources are sub-divided, in order of increasing
                       geological confidence, into Inferred, Indicated and Measured categories when
                       reporting under JORC

 "Mt"                  million tonnes

 "oz"                  troy ounce (= 31.103477 grammes)

 "PQ Core"             Diamond drill core with 122.6mm hole diameter

 "Probable Reserve"    the part of Indicated and in some cases Measured Resource that can be mined at

                     a profit.  It includes diluting materials and allowances for losses that may
                       occur during mining.

                       the part of Indicated Measured Resource that can be mined at a profit.  It

                     includes diluting materials and allowances for losses that may occur during
 "Proven Reserve"      mining.

 "Reserve"             the part of a Measured and/or Indicated Mineral Resource that can be mined at
                       a profit.  Reserves are subdivided in order of increasing confidence into
                       Probable and Proven categories when reporting under JORC.

 "t"                   tonne (= 1 million grammes)

 "QA/QC"               Quality assurance and quality control (QA/QC) procedures during exploration
                       ensures the trustworthiness of the data produced.

                       Quality assurance (QA) and quality control (QC) are procedures used in the
                       laboratory to ensure that all analytical measurements made are accurate.

 

 

ENDS

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