Chaarat Gold Holdings Ltd on Tuesday outlined its strategy to move its wholly-owned Chaarat project in the Kyrgyz Republic into production.
The first phase is the development of the Tulkubash oxide ore using open-pit mining and a heap leach processing facility, which is expected to produce 100,000 ounces of gold a year, generated USD40 to USD60.0 million cash flow annually at current gold proces.
A feasibility study for Tulkubash is due to be completed in mid-April and will be based on the estimated resources of 1.1 million ounces of gold, at a grade of 0.84 grams per tonne.
The second phase will be the development of Kyzyltash refractory sulphide ore on the project, which is amenable to pre-oxidation and cyanidation recovery and has the potential to produce 200,000 to 300,000 ounces of gold year, giving an annual cash flow of USD150.0 million to USD200.0 million per year.
The Kyzyltash resource is estimated at 5.4 million ounces of gold at a grade of 3.75 grams per tonne.
Chaarat will look at potential acquisition targets, as well, with particular attention paid to areas in the central Asia region, with gold production at a competitive cash cost, exploration upside, and the potential for extended mine life.
“I am pleased to deliver this update on the company’s strategy and provide the market with more clarity on how Chaarat’s management team plans to deliver on the company’s goal of becoming a leading mid-tier gold producer focused in Central Asia and the former Soviet Union,” said Chairman Martin Andersson.
“I remain encouraged by the support expressed for the Chaarat project at the highest levels of government in the Kyrgyz Republic as evidenced at my recent meeting with the Prime Minister. Additionally, Chaarat will look to pursue selective M&A opportunities in Central Asia and the former Soviet Union as the company believes it is a region that is ripe for consolidation, and that Chaarat is well positioned to be able to deliver this,” Andersson added.
Shares in Chaarat Gold were down 4.8% at 19.00 pence on Tuesday.