TIDMCGH
RNS Number : 3093S
Chaarat Gold Holdings Ltd
23 September 2014
Chaarat Gold Holdings Limited
("Chaarat" or the "Company")
NFC and NERIN to prepare DFS for the Chaarat Project
Road Town, Tortola, British Virgin Islands (23(rd) September
2014)
Chaarat (AIM - CGH), the AIM quoted exploration and development
company with assets in the Kyrgyz Republic, is pleased to provide
an progress update on the Definitive Feasibility Study ("DFS") for
the Chaarat Project ("the Project").
Highlights
-- NFC (China Nonferrous Metal Industry's Foreign Engineering
and Construction Co. , Ltd) and its majority owned subsidiary NERIN
(China Nerin Engineering Co., Ltd) commissioned to complete DFS for
Chaarat during H1 2015
-- Relevant experienced project management appointed by NERIN/NFC
-- Study to comply with Chinese Bankable Feasibility Study standards
-- Strengthening of Chinese relationships to assist development
of the Chaarat Project following completion of the DFS
-- Site investigation work, geotechnical and hydrological work completed
-- Baseline measurements and investigation expanded to include new project layout
Chaarat has signed an agreement with NFC to complete the
Definitive Feasibility Study for the Chaarat Project. The work will
be carried out by NFC's affiliated design institute NERIN.
Both companies bring unrivalled relevant credentials to the
development of the Chaarat Project. NERIN designed the Zijinshan
gold/copper mine, a large heap leach operation in Inner Mongolia,
as well as the Jinfeng gold mine in China. Jinfeng has many
similarities to the Chaarat Project both in ore composition and
mining conditions. The Zijinshan mine was developed in stages
comparable with the current development plan for Chaarat.
NFC has developed and invested in approximately 90 mines around
the world and has recently completed the construction of the
Bozymchak copper gold mine in the Kyrgyz Republic for Kazakhmys.
NFC is therefore ideally placed to understand the particular
conditions of the Chaarat Project both in country and
regionally.
The project manager nominated for the preparation of Chaarat's
DFS was a member of the project management teams for both Jinfeng
and Bozymchak. The other team members will also be experienced in
the development of gold mines.
Dekel Golan, CEO of Chaarat, comments: "We are excited about
this significant milestone. It is my belief that this agreement is
a first step towards a broader cooperation between our companies.
In my meetings with President Wang and Vice President Qin it has
been made very clear to me that NFC is interested in more than just
the preparation of the feasibility study, and the management of
both our companies have agreed to discuss further cooperation.
NFC is affiliated with our large Chinese shareholder (China
Nonferrous Int'l Mining Co. Ltd) which owns about 9% of Chaarat. We
view the strengthening of our relationship as a positive.
More generally, we are seeing a renewed and strong interest in
gold projects in the Kyrgyz Republic from mainly Asian based
companies including those from China, Japan, Korea and
Indonesia."
Further information
In March 2014 we announced the appointment of contractors to
complete the DFS for the Chaarat Project. In June we announced that
we were undertaking additional drilling to support the assessment
of an enlarged heap leach opportunity. This drilling is now
complete and the results are being evaluated. We have also
completed the data collection work from the revised location of the
production facility in the adjacent valley to the Chaarat
deposit.
While drilling and data collection were underway this summer,
further work on the DFS was put on hold until the results could be
evaluated. During this period, representatives of NFC and NERIN,
who had been working in the Kyrgyz Republic on the Bozymchak mine,
approached Chaarat's team in Bishkek. Following a strategic
assessment of the development and financing options available to
Chaarat, the Board was convinced that working with a reputable
Chinese group would ensure a more comprehensive review of available
development options for the Project as well as retaining the costs
of the DFS within the existing budget.
As a result, after considerable negotiation and a process of
careful review, the Board decided that the best option to complete
the DFS was to sign an agreement with NFC/NERIN and discontinue the
contracts with the previous DFS contractors. RDi will continue to
be Chaarat's metallurgical consultants and the new resource
calculation will be prepared by GeoSystems International, Inc.
Once the DFS is completed basic engineering and the EPC tender
will take place in parallel with the local permitting process. An
advantage of working with a Chinese company is that the
"Adaptation" of the DFS to local standards, for the purpose of
obtaining construction permits, will be more straightforward, since
the structure of local and Chinese feasibility studies is
similar.
Another persuasive factor in the Board's decision was the view
that the development of a project such as Chaarat in today's
environment should be carried out on a turnkey contract basis.
Previous experience has demonstrated that in Engineering,
Procurement and Construction (EPC) tenders Chinese contractors
typically offer the best terms.
The final key consideration was the existence of a number of
Chinese organisations providing credit for overseas development
with specific subsidised credit facilities for projects in
neighbouring countries such as the Kyrgyz Republic.
Chaarat's Board therefore believes that working with NFC/NERIN
will pave the way to enable us to raise project finance quickly and
efficiently and the DFS will include the information required in a
Chinese Bankable Feasibility Study.
The Feasibility Study is expected to be concluded during the
first half of 2015.
Enquiries:
Chaarat Gold Holdings Limited + 44 23 800 11747
c/o Central Asia Services Limited info@chaarat.com
Dekel Golan CEO
Linda Naylor FD
Numis Securities Limited +44 (0) 20 7260 1000
John Prior, Stuart Skinner (NOMAD)
James Black (Broker)
Further information is available at www.chaarat.com
NOTES TO EDITORS:
About Chaarat Gold
Chaarat Gold is an exploration and development company operating
in the Kyrgyz Republic with a large, high grade resource - the
Chaarat Gold Project. The Company's key objective is to become a
low cost gold producer generating significant production from the
development of the Chaarat Gold Project. Chaarat is preparing a
Definitive Feasibility Study (DFS) and continuing its active
community engagement programme to optimise the value of the Chaarat
investment proposition.
Chaarat aims to create value for its shareholders, employees and
communities from its high quality gold and mineral deposits in the
Kyrgyz Republic by building relationships based on trust and
operating to the best environmental, social and employment
standards.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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