TIDMCGH
Chaarat Gold Holdings Limited
("Chaarat" or "the Company")
Increase in the Chaarat Gold Project Calculated Resource to 5.59 million ounces
Over 1 million ounces added in 2011 drilling campaign
Road Town, Tortola, British Virgin Islands (5 March 2012)
Chaarat (AIM-CGH), the gold exploration and development company operating in the
Kyrgyz Republic, is pleased to announce a resource update based upon its 2011
drilling campaign at its Chaarat Gold Project.
Highlights
* Updated estimate of the gold resource to 5.59 million ounces, an increase of
27% from the 4.406 million ounces announced on 7 February 2011
* Tulkubash (including mostly free milling mineralisation) section of the
resource increased by 56% to 501,000 ounces from 321,000 ounces
* Sulphide (refractory) section of the resource increased by 25% to 5.09
million ounces
During the 2011 exploration season 171 new core drill holes (29,094 metres) were
drilled and subsequently incorporated into the Resource Database. The resource
was estimated to JORC compliant standards by Wardell Armstrong International
("WAI"), an internationally recognised consulting company.
Drilling has been focused on three main "Projects", which Chaarat is developing
into viable mining projects, in order to establish the foundation for a large
scale low cost mining operation.
The Tulkubash Project
The oxide mineralisation hosted in the Tulkubash quartzite can be identified
over a 6 km strike length. Drilling to date has focused on a small 500m section,
where infill drilling has allowed the delineation of a mineable reserve
(calculation to JORC compliant standards is in progress). The considerable on-
strike extension potential, which is likely to facilitate a rapid increase in
the production rate (as announced on 22 November and 7 December 2011), has been
demonstrated by 440 metres of wide spaced drilling to the north of the deposit.
Drilling has been focused on the near surface part of the mineralisation which
can be extracted by low strip ratio open pit mining, the oxide ore from which is
expected to be mostly free milling. This resource has increased by 56% from
321,000 ounces to 501,000 ounces within the Measured, Indicated and Inferred
categories. Due to the focus on the shallower, more weathered section of the
deposit, the resource grade decreased to 2.93 g/t.
As reported on 7 December 2011, the Company continues to work on the
documentation required for the application for the grant of a mining licence -
it plans to start mining this summer. Gold production is due to commence in
2013 once the processing plant has been commissioned.
The Contact Project
This Project, characterised by a wide and consistent vein system, currently
hosts 2.78 million ounces (with 1.675 million ounces in the Indicated category),
an increase of 39% over last year's resource update. This increase in resource
was accompanied by a small improvement in grade to 4.32 g/t. The Contact Project
is open both on strike (both towards south and north) as well as down dip. The
width of the mineralisation and its grade improve with depth.
The Main Project
The Main Project, (which was formerly known as M2400 and M3000), is now
recognised as a single large body of 1.51 million ounces (with 0.866 million
ounces in the Indicated category), an increase of 17%, with the combined grade
falling slightly to 4.14 g/t. Only 13 holes were drilled in the Main Project
this year. However it is expected that the size of this Project will increase
significantly and the grade will improve once underground drilling can take
place following the development of an adit.
Additional bodies
Due to limited funding and the need to prioritise drilling in the areas outlined
above, no drilling was carried out on a further six bodies comprising 794,000
ounces between them at a grade of 4.16 g/t. These bodies are very promising
and are adjacent to the Main and the Contact Projects.
Dekel Golan CEO comments:
"2011 was another excellent year during which we added over a million ounces of
gold to our resource. I believe that the tremendous potential of Chaarat is
being demonstrated by successful, rigorous exploration activity and the
development of the infrastructure needed to support a large-scale operation. The
significantly improved political climate in the Kyrgyz Republic (a recent report
from the Economist Intelligence Unit recently heralded the Kyrgyz Republic as
the most democratic of the Central Asian republics) is giving a welcome added
impetus to our operations during this development phase, whilst the Tulkubash
Project, the non-refractory section of the deposit, is being fast tracked to
development in order to stimulate early cash flow for the Company. These are
exciting times for us at Chaarat."
Methodology
The Mineral Resources for the Main and Contact Zones at the Chaarat gold deposit
in the Kyrgyz Republic were estimated by WAI in January 2012 using industry-
standard geological modelling and Mineral Resource estimation software.
The revised estimation has used all available exploration data from previous
(2004 to 2010) exploration campaigns, including assays from drill holes,
bulldozer-cuts, trenches and underground.
The data was used to develop new, three-dimensional, geological wireframe models
for each mineralised zone using a boundary definition cut-off grade of 2g/t Au
for the Kiziltash Projects and 1 g/t Au cut-off for the Tulkubash Project. Once
the 3-D geological solids were built, a two-dimensional estimation was
undertaken for the mineralised zones.
WAI used ordinary kriging for the estimation of all sub-zones within the Main
and Contact Zones using a block size of 20m by 20m by 10m.
All WAI estimates were validated by comparing the global mean statistics of the
sample data with the estimates and a swath analysis exercise, which compared the
composite data with the block estimates within a given swath, validating the
quality of the local estimates.
WAI has taken into account the data distribution, grade variability, geological
interpretations, structure of the variograms and the quality of the estimation
in the classification of the Mineral Resource.
The recent infill drilling has demonstrated the depth and width continuity of
the geological boundaries of the Main, Contact and Tulkubash Zones and has
resulted in an increase in the volume of the mineralisation compared with the
previous Resource estimates.
Competent Person
The Competent Person with overall responsibility for this press release, and who
has reviewed the information contained herein, is Sunit Patel, M.Sc. (Geology),
FGS, GSSA, who is an employee of Chaarat. Sunit is an exploration geologist with
more than 23 years of experience in the resource industry who has sufficient
experience relevant to the style of mineralisation and type of deposit under
consideration and to the activity which he is undertaking to qualify as a
Competent Person as defined in the 2004 Edition of the 'Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves' and he was
supervisor to the work which is the subject of this release. Mr. Patel consents
to the inclusion in the report of the matters based on this information in the
form and context in which it appears.
Enquiries:
Chaarat Gold Holdings Limited +44 (0) 20 7499 2612
c/o Central Asia Services Limited
Dekel Golan CEO dekel@chaarat.com
Linda Naylor FD linda.naylor@chaarat.com
Numis Securities Limited +44 (0) 20 7260 1000
Alastair Stratton, Stuart Skinner (NOMAD)
James Black (Broker)
Bankside Consultants +44 (0) 20 7367 8888
Simon Rothschild simon.rothschild@bankside.com
Smith's Corporate Advisory +44 (0) 20 7601 6100
Dominic Palmer- Tomkinson tomkinson@smiths-ca.com
Table 1: Summary of Estimated Resources at Chaarat (February 2012)
+----------+-----------------------+---------------------+---------------------+
| | Measured* & Indicated | Inferred | Total |
| | | | |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| |Tonnage |Grade |Content|Tonnage|Grade|Content|Tonnage|Grade|Content|
| Project | (kt) | (g/t | (koz) | (kt) |(g/t | (koz) | (kt) |(g/t | (koz) |
| | | Au) | | | Au) | | | Au) | |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| TULKUBASH |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
|Tulkubash | 2,325 | 2.84 | 214 | 2,987 |2.99 | 287 | 5,312 |2.93 | 501 |
| Project | | | | | | | | | |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| KIZILTASH |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| Contact | 12,038 | 4.36 | 1,675 | 8,045 |4.25 | 1,109 |20,083 |4.32 | 2,784 |
| Project | | | | | | | | | |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| Main | 6,236 | 4.20 | 866 | 4,889 |4.07 | 645 |11,125 |4.14 | 1,511 |
| Project | | | | | | | | | |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| ADDITIONAL BODIES |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| C4000 | 425 | 3.33 | 46 | 444 |3.33 | 48 | 869 |3.33 | 94 |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| M3400 | 27 | 3.46 | 3 | 941 |4.71 | 142 | 968 |4.68 | 145 |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| M3900 | 762 | 3.49 | 86 | 1,663 |3.86 | 206 | 2,425 |3.74 | 292 |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| M4400 | | | | 321 |6.29 | 65 | 321 |6.29 | 65 |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| M5000 | | | | 413 |5.70 | 76 | 413 |5.70 | 76 |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| M6000 | 111 | 4.45 | 16 | 824 |4.01 | 106 | 935 |4.06 | 122 |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| Total | 1,325 | 3.52 | 151 | 4,606 |4.34 | 643 | 5,931 |4.16 | 794 |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| Sulphide | 19,599 | 4.26 | 2,692 |17,540 |4.22 | 2,397 |37,139 |4.24 | 5,089 |
| Section | | | | | | | | | |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
| GRAND | | | | | | | | | |
| TOTALS/ | 21,924 | 4.11 | 2,906 |20,527 |4.04 | 2,684 |42,451 |4.08 | 5,590 |
| AVERAGES | | | | | | | | | |
+----------+--------+------+-------+-------+-----+-------+-------+-----+-------+
*The Company's only measured resource is within the Tulkubash Project and
comprises a tonnage of 180kt at a grade of 3.07 g/t Au and content of 18koz.
Quantity and Quality of Data
The Mineral Resource estimate has been compiled from all core drill holes
completed on 10 project areas at Chaarat to date and supersedes the resource
update announced on 7 February 2011 and the update on the Contact Project
announced on 7 July 2011.
The 463 holes included in the Mineral Resource estimate were drilled on the
three sub-parallel zones of mineralisation at Chaarat, the Main, the Contact and
the Tulkubash Zones, which are characterised by mineralisation up to 37 metres
wide and dipping at 55 to 70 degrees to the northwest.
The deepest drill intersection on the Contact Project is 552.40 metres. On the
other nine project areas, included in the Mineral Resource estimate, drilling is
limited to depths of between 82 to 434 metres.
On all project areas, the mineralisation remains open down dip, and on the
majority, also open along strike. Surface drilling will focus on the Tulkubash
Project to upgrade the category of resource in the northeastern section so that
it can augment the expected open pit production in the Tulkubash. Underground
drilling will continue from the adit on the Contact Project Area, with the aim
of increasing the Resource in the coming year, as well as converting the
existing Inferred Resources to the Indicated category.
The Resource database contains 78,529 gold assay records from surface, adit and
drill-core samples. WAI has reviewed 4,328 umpire assays, 1,517 results of
reference materials and 3,491 blanks sent to three laboratories and concluded
that the quality and quantity of data are sufficient to support the Mineral
Resource estimates reported herein.
About Chaarat Gold
Chaarat Gold is an exploration and development company operating in the Kyrgyz
Republic. The Company's main activity is the development of the Chaarat Gold
Project situated within the Middle Tien Shan Mountains, which form part of the
Tien Shan gold belt. The Company has delineated a JORC compliant mineral
resource of 5.590Moz at a grade of 4.08g/t gold. Chaarat's key objective is to
become a low cost gold producer; with initial production from the Tulkubash
project, targeting increased combined annual production of over 200,000 ounces
as the full project comes on stream.
Further information is available at www.chaarat.com
Disclaimer
This press release includes forward-looking statements. Such forward-looking
statements involve known and unknown risks, uncertainties and other important
factors beyond Chaarat's control that would cause the actual results,
performance or achievements of Chaarat to be materially different from future
results, performance or achievements expressed or implied by such forward-
looking statements. Such forward-looking statements are based on numerous
assumptions regarding
Chaarat's present and future business strategies and the environment in which
Chaarat will operate in the future. Any forward-looking statements speak only as
at the date of this document. Chaarat expressly disclaims any obligation or
undertaking to disseminate any updates or revisions to any forward-looking
statements contained in this document to reflect any change in Chaarat's
expectations with regard to these or any change in events, conditions or
circumstances on which any such statements are based. As a result of these
factors, the events described in the forward-looking statements in this press
release may not occur either partially or at all.
Glossary of Technical Terms
"assay" qualitative or quantitative analysis of a metal or ore to
determine its components
"Au" chemical symbol for gold
"cut-off" the lowest grade value that is included in a resource
statement. It must comply with JORC requirement 19:
"reasonable prospects for eventual economic extraction" the
lowest grade, or quality, of mineralised material that
qualifies as economically mineable and available in a given
deposit. It may be defined on the basis of economic
evaluation, or on physical or chemical attributes that
define an acceptable product specification
"g/t" grammes per tonne, equivalent to parts per million
"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, 2004 (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
"kriging" an inverse distance weighting technique where weights are
selected via the variogram according to the samples'
distance and direction from the point of estimation. The
weights are not only derived from the distance between
samples and the block to be estimated, but also the
distance between the samples themselves. The kriging
estimates are controlled by the variogram parameters which
are interpreted from the data
"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
"Mineral Resource" 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 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
"Moz" million troy ounces
"ordinary kriging" commonly used type of kriging which assumes a constant but
unknown grade
"oz" troy ounce (= 31.103477 grammes)
"t" tonne (= 1 million grammes)
"variogram" a method of displaying and modelling the difference in
grade between two samples separated by a distance "h",
called the "lag" distance. It provides the mathematical
model of variability with distance and is used during
kriging
"wireframe" this is created by using triangulation to produce an
isometric projection of, for example, a rock type,
mineralisation envelope or an underground stope. Volumes
can be determined directly of each solid
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Chaarat Gold Holdings Ltd via Thomson Reuters ONE
[HUG#1591148]
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