Chaarat Gold Holdings Ltd – Operations update

Chaarat Gold Holdings Ltd – Operations update

Operations update

Chaarat (CGH), the gold exploration and development company operating in the Kyrgyz Republic, is pleased to announce an update on recent developments in the Pre Feasibility Study (PFS) at its 100% owned Chaarat project, on which a 4.009 million ounce JORC compliant gold resource has been reported.

Highlights

  • The PFS findings indicate the potential of implementing an initial high grade, low-cost, open pit mine within the T0700 project area
  • The PFS is on track for completion in Q3 2010

T0700 Project Area

Strong progress has been made in determining the development strategy and economic parameters of the Chaarat project.

A significant development, which is being explored in more detail, is the potential of implementing an initial, high grade, low-cost open pit mine within the T0700 project area in the Tulkubash zone.  This area currently has a JORC compliant resource of 336,000 oz at a grade of 4.18 g/t Au.  The development of such a mine would require a comparatively small capital investment and provide a much shorter time frame to production than originally envisaged. 

Recent work has shown that a significant proportion of the mineralisation in the T0700 project area is not sulphidic and that consequently gold can be extracted by direct and simple cyanidation.  This option would not require the costly pressure oxidation unit which is part of the larger scale project.  It has also been confirmed that almost all of the resource in the T0700 project can be mined by an open pit method.  Open pit is a significantly cheaper mining method than underground mining and could allow a rapid increase in the mining rate.

The benefits of developing an early stage open pit operation within the T0700 project area will need to be considered against its inclusion within the construction of the full scale plant which will take place later and require much larger investment.  The economic analysis of the relative merits of the two options will be dependent on the fund raising options available to the Company.  Chaarat is in the process of assessing the best development strategy for its shareholders.

The Company believes that the Tulkubash zone, which has not been extensively drilled to date, is very prospective and significant exploration attention will be directed towards it.  The Company is pleased to report that drilling will recommence this week in the Tulkubash zone and preliminary studies indicate the potential for the resource to be increased considerably.

Dekel Golan, CEO of Chaarat, comments: “I am delighted to report such pleasing progress on the project and look forward to updating the market as we proceed to completion of the PFS  later this year .”  

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