Chaarat Gold ups Kyrgyz Republic project resource by 46 pct

Chaarat Gold Holdings (LON:CGH), the company trying to buy Centerra's Kumtor mine in the Kyrgyz Republic, has increased the mineral resource for the Tulkubash oxide gold deposit at its Chaarat gold project by 46%, based on a new and simplified geologic model.

The Central Asia-focused explorer and developer, which has been carrying out an intensive drill campaign at the project this year, said Tulkubash’s measured and indicated resource is now over 1.4 million ounces of gold, while the grade also rose 57% to 1.35g/t gold.

The interim resource update used the results from the 10,525m of diamond drilling over 63 holes since the last resource update, provided at the end of January.

Chaarat also extended the resource boundary 1,040m, or 47%, along strike to a total length of 3,200m.

The company's next step will be to undertake more drilling with the aim of moving those resources into reserves.

"The updated resource model represents the Company's current state of geologic understanding of the Tulkubash deposit,” Chaarat technical director and head of exploration Dorian Nicol said in the statement. “The company considers that this model accurately reflects the geology of the deposit and is very robust, both geologically and geostatistically."

The next step will be to undertake more drilling with the aim of moving those resources into reserves – the amount of gold it thinks it can, and is worthwhile, getting out.

The plan is to drill another 20,000 metres between now and the end of October, at which point Chaarat will release a new reserve update. Using that data, a new resource update will be published early in 2019.

According to the company, drilling has helped it gain a better understanding of the distribution of oxide mineralization within Tulkubash. Chaarat will combine that knowledge with the results of the recent metallurgical test programme to forecast recoveries more accurately.

Last week, the firm said it planned to raise up to $100 million to help fund the acquisition of an undisclosed producing polymetallic mine in Central Asia.

The junior also noted it was still interested in buying Kyrgyzstan’s largest gold mine and that it remained committed to completing the proposed $800-million deal, as its financing continue to support the transaction.