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Ariana Resources takes Red Rabbit gold project forward in ‘busy & exciting’ first half

Ariana Resources (LON:AAU) aims to complete the project feasibility for its Red Rabbit joint venture within a year.

In this morning’s results statement, managing director Dr Kerim Sener commented on a ‘busy and exciting’ first half.

“Our plans for the development of the Red Rabbit project continue to crystallise and activities within the newly incorporated JV company, Zenit Madencilik, are progressing solidly,” Sener said.

The integrated Red Rabbit project is combination of the Kiziltepe and the Tavsan gold projects in western Turkey.

“Recent resource drilling at Kiziltepe was concluded on a positive note with vein extensions now proven beneath cover. This adds to our confidence that the current resource base across the project will grow from the current base of 401,000 oz gold equivalent.”

During the busy six month period ended 30th June, Ariana completed positive independent economic and environmental scoping reports for the Kiziltepe, which "demonstrated the viability of the envisaged operations".

The company also completed its resource drilling programme on Kiziltepe, and raised £1 million though a placing.

Importantly Ariana successfully negotiated the terms of the Red Rabbit joint venture, and the basis for the newly created Zenit Madencilik (who will manage Red Rabbit).

Through a deal with Turkish construction firm, Proccea, the company is set to move the project forward.

Proccea will earn 50% of the Red Rabbit Project with a US$1.4 million commitment to the bankable feasibility and environmental studies, and a further US$6.6 million to start plant construction.

Looking ahead Ariana told investors that it remains fully committed and on-track to establish a gold-silver mine in Turkey.

Ariana is due to formally start the Bankable Feasibility Study and Environmental Impact Assessment.

Some aspects of the feasibility study are already underway, including the mineral resource statement and processing plant designs.

The completed feasibility study is expected by the third quarter of 2011.

Disclosure: The author hods no position in the company