2013 News

Mine Permitting to be Initiated at the Red Rabbit Gold Project, Turkey

Ariana Resources plc ("Ariana" or "the Company"), the gold exploration and development company focused on Turkey, is pleased to announce further developmentprogress at the Kiziltepe Sector of the Red Rabbit Gold Project in Western Turkey,ahead of mine construction targeted in Q4 2013.

Highlights:

  • Decree of the Ministerial Council in Turkey removes the Kiziltepe Sector site from an area previously affected by the requirements of the Ministry of Culture and Tourism, and allowing Ariana to proceed with the Environmental Impact Assessment (“EIA”).
  • EIA project summary documentation will be submitted to the Ministry of Environment and Urban Planning (“MEUP”) shortly. This will initiate the formal process for the permitting of the mine.
  • Geotechnical drilling and site investigation for clay nearing completion at the Tailings Storage Facility (“TSF”) site.

Results to date have been positive and support the potential for the designated area to host the tailings dam.

Dr. Kerim Sener, Managing Director, commented: “Following the approval of our forestry permits last month, this Ministerial Council Decree has removed another hurdle for us ahead of the construction of our first mine during late 2013. The imminent submission of our EIA documentation and initiation of the mine permitting process are significant milestones for Ariana as we advance closer to commercial production from Red Rabbit in 2014.

“Development activities on the ground are also bearing fruit for the Company, with significant progress made being made by our technical team on drilling operations at the designated tailings dam site. Initial indications have been highly encouraging with the site demonstrating itself to be conducive for the location of the tailings dam, and we hope to confirm this through further work.

“The Company will update shareholders with a revised project schedule in due course, as we remain focused on our target of commercial production in 2014.”

Ministerial Council Decree

On 20 January 2013, the Official Gazette of the Turkish Republic published a decree by the Ministerial Council, which has brought in to effect various modifications to areas defined for touristic purposes across Turkey. Twelve areas are defined in the decree, which in some cases established and in other cases modified the boundaries of previous regions for touristic purposes in Turkey.

Prior to this decree, parts of the Kiziltepe Sector lay within the boundaries of the Balikesir-Sindirgi-Hisaralan Thermal Tourism Centre and the Company had been taking various procedural steps to have our mining area formally excised from this region via an application to the Ministry of Culture and Tourism (“MCT”). The Company had already received an official letter of confirmation from the MCT in May 2012 stating that the Company had clearance to proceed with all exploration, development and mining work within the limits of three operational licences that fell within the boundaries of the thermal tourism region. This was supported by earlier official communications from the General Directorate of Mining Affairs, which had granted the licences and the principal mining permit prior to the thermal tourism area having been established.

As a result of this decree, the activities of the Company will no longer have any direct impact on the newly defined thermal tourism region, although the Company will continue to comply with the various environmental requirements of the MEUP. Despite the fact that the mining area now lies completely outside of the designated thermal tourism region, the Company continues to recognise the importance of this region from a touristic perspective and aims to ensure that its activities remain compatible with and indeed supportive of the touristic potential of the area.

Initiation of EIA Permitting

Following the decree referred to above, the Company, via its Joint Venture operating subsidiary, Zenit Madencilik San. ve Tic. A.S. will be submitting its Project Summary Document to the MEUP shortly. This will follow from a joint review of the report with its environmental consultants, SRK Consulting, this week. The report includes relevant extracts from its Environmental Impact Assessment study and its submission to the MEUP is a requirement for formal permitting of the mine to commence. The process of mine permitting will involve public consultation meetings and the receipt by MEUP of consents from several other ministries and government departments. The process is expected to take five to six months, at the end of which the Company expects to receive its EIA positive certification, which in turn would enable the Company to commence construction permitting and development of the mine. The Company will provide a further update on the project timeline in due course, but based on these latest developments, the Company remains on track for construction to commence in Q4 2013.

Geotechnical Drilling

Following the grant of relevant forestry permits in the designated TSF area in late 2012, final geotechnical drilling work for the TSF engineering study commenced in December 2012 and is due to be completed during February 2013. A total of eight HQ holes of 30m each, with packer tests completed at 2m intervals in each hole were determined necessary for the detailed design of the TSF. IMC-S Teknik Sondaj Ltd. is carrying out the drilling programme in accordance with the technical requirements of the design team. In addition to the packer tests, which are completed in the field, various lab testsare also planned such as grain size distribution, bulk density and uniaxial compressive strength.

To date six holes of the programme have been completed and drilling is currently progressing on the seventh hole. Before construction commences, the completedholes will be used as sub-surface water monitoring stations before being filled with concrete. Based on current progress, the full geotechnical site investigation report for the TSF area will be completed during March 2013.

Site Investigation for Clay

The designated TSF area was investigated for its potential to host sufficiently impermeable material to act as a barrier substrate within the tailings dam. Several sites within the basin of the TSF were trenched (17 trenches) and initial assessment has been positive. The material recovered from these sites and, on comparison to drilling results in the top 5m of each hole, shows that there is sufficient in-situ clay material, which when homogenised and mixed with certain additives, could be used in addition to geomembranes as part of the impermeable barrier for lining of the tailings dam. This is a significant outcome that could substantially reduce the estimated cost of building the tailings dam.

Editors’ note:

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 selected on the basis of its in-house geological and remote-sensing database, on its own in western Turkey and in Joint Venture with Eldorado Gold Corporation in north-eastern Turkey. Eldorado owns 51% of this joint venture and is fully funding all exploration work on the JV properties, while Ariana owns 49% and is the operator.

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, are presently being assessed as to their economic merits and now form part of a Joint Venture with Proccea Construction Co. The total resource inventory of the Company stands at 448,000 ounces of gold equivalent.

Ariana also has a strategic investment in Tigris Resources Limited (www.tigrisresources.com), a private Jersey-based exploration company, which is focused on the exploration of copper and gold deposits in southeastern Turkey. Ariana retains 12.3% of Tigris Resources Limited.

S.P. Angel Corporate Finance LLP are brokers to the Company and Beaumont Cornish Limited is the Company's Nominated Adviser.

Contacts Ariana Resources plc Tel: +44 (0) 20 7407 3616 Michael Spriggs, Chairman Kerim Sener, Managing Director Beaumont Cornish Limited Tel: +44 (0) 20 7628 3396 Roland Cornish / Felicity Geidt S. P. Angel Corporate Finance LLP Tel: 44 (0) 20 3463 2260 Ewan Leggat / Laura Littley St Brides Media & Finance Ltd Tel: +44 (0) 20 7236 1177 Hugo de Salis / Susie Geliher