Chaarat Gold says Tulkubash project is on track

Chaarat Gold Holdings shares climbed Monday after the miner announced an increase in gold resources and a positive update on its Tulkubash project in Kyrgyz Republic.

Chaarat Gold Holdings shares climbed Monday after the miner announced an increase in gold resources and a positive update on its Tulkubash project in Kyrgyz Republic.

Chief Executive Officer Dekel Golan said the Tulkubash project remains on track to begin production in the second half of this year using heap leaching which is expected to reduce capital costs and power requirements.

"Chaarat will benefit from the lower upfront investment and lower power requirements of heap leach processing, having identified both a significant amount of shallow material in the Tulkubash which is amenable to heap leaching and established the greater-than-expected open pit potential of the deposit," he said.

Following last year's drilling, the company saw a 3.0% increase in gold resources to 5.76m ounces.

The Tulkubash project is expected to improve results when the firm starts the first stage of development which involves the processing of low-sulphur clean ore.

It is estimated that approximately 2.7 metric tonnes of resource at a grade of 2.06 gross tonnage are suitable for heap leaching at the prospect.

The company has previously announced it would raise a working capital of $20m to cover initial mining costs. However savings have been identified from the original project budget as the capital required to build a heap leaching pad is lower than a carbon in leach plant. Chaarat also cut costs in the construction of the access road to the site.

"Through our strict control of capital expenditure and the revised approach to production, the company's cost of reaching production is going to be lower than we previously estimated," said Golan.

"These savings have been mitigated by the effect of the changes in the new tax regime which have a negative effect of about $15m on our cash flow prior to becoming net cash generative. The final revised requirement for working capital will be confirmed once we have completed our detailed work on the revised mine plan and operating budget."

RD

Recommended

Three top-notch Asian stocks to buy
Share tips

Three top-notch Asian stocks to buy

Professional investors Adrian Lim and Pruksa Iamthongthong, managers of the Asia Dragon Trust, pick three of their favourite Asian stocks to buy now.
23 Sep 2022
Why you should short this broadband satellite company
Trading

Why you should short this broadband satellite company

With an ill-considered business plan, broadband satellite company AST SpaceMobile is doomed to failure, says Matthew Partridge. Here's how to short th…
23 Sep 2022
Share tips of the week – 23 September
Share tips

Share tips of the week – 23 September

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
23 Sep 2022
Momentum investing – and why price matters more than anything else
Investment strategy

Momentum investing – and why price matters more than anything else

The recent fashion for momentum investing, with investors piling into expensive growth stocks, is nothing new, says Merryn Somerset Webb. And the dang…
21 Sep 2022

Most Popular

Why we should abolish stamp duty – the worst tax in Britain
Tax

Why we should abolish stamp duty – the worst tax in Britain

Stamp duty is Britain’s most horrible tax. We should forget cutting it and abolish it altogether, says Merryn Somerset Webb.
22 Sep 2022
Mini-Budget: stamp duty and income tax cut as Kwarteng targets growth
Tax

Mini-Budget: stamp duty and income tax cut as Kwarteng targets growth

Chancellor Kwasi Kwarteng announced sweeping tax cuts in his mini-Budget statement. Here's what was said.
23 Sep 2022
Could gold be the basis for a new global currency?
Gold

Could gold be the basis for a new global currency?

Gold has always been the most reliable form of money. Now collaboration between China and Russia could lead to a new gold-backed means of exchange – g…
22 Sep 2022