Ariana Resources sees record revenue at Kiziltepe in third quarter

The AIM-traded firm owns 50% of Kiziltepe, as part of the Red Rabbit joint venture with Proccea Construction, through its shareholding in Zenit Madencilik.

It reported record gross quarterly income of $11.76m at an average realised gold price of $1,476 per ounce for the period, against an average revenue per gold ounce of $1,696, due to silver credit.

Production totalled 6,933 ounces of gold during the quarter, with 2019 gold production to the end of the third quarter reaching 20,667 ounces of gold, and the company claiming it was on track to achieve its annual production guidance of 25,000 ounces of gold.

Operating cash costs for the quarter were estimated at $540 per ounce, while operational mill availability was running at 99.6% and utilisation at 99.4% for the period.

A total of 55,174 tonnes of ore was milled during the period to 30 September, at an average head grade of 4.47 grams of gold per tonne.

Process recoveries of gold also remained high, Ariana said, at 93.6% by the end of the quarter.

Looking at its finances, Ariana said 78% of the $33m capital loan for Kiziltepe had been repaid as at period end, with the firm saying it was on track to fully repay the loan by April 2020.

“The third quarter results from the Kiziltepe Mine continue to build on a very successful year of operations,” said managing director Dr Kerim Sener.

“Operating cash costs per ounce for the period are estimated at $540 per ounce, reflecting in part the pushback on the southern boundary of the Arzu South pit and the commencement of pre-stripping at Arzu North and Derya, in addition to a build-up of process plant consumables inventory and increased maintenance.”

Dr Sener said the gold price continued to remain “very favourable” throughout the period, averaging $1,474 per ounce, which was 13% above the firm’s feasibility base-case.

“This pricing environment is now reflected in our third quarter results, which demonstrates record quarterly revenue for the mine to date.”

At 0822 GMT, shares in Ariana Resources were up 6.34% at 2.18p.