Centerra Gold (CG-T) is going all-in on a Turkish gold project as the company is acquiring the final 30% interest in the Oksut Gold Project from Stratex International (STI-L) for $20 million in cash and a 1% net smelter return that is capped at $20 million.
The two companies formed a joint venture back in 2009 in a deal that allowed Centerra to earn a 50% interest for $3 million and another 20% by anteing up another $3 million. In total, Centerra says it has spent $6.8 million on exploration at Oksut.
Once this final transaction is closed, which is contingent upon six exploration licences being converted into two operation licences, Centerra says it will focus on pushing into development.
“Our immediate objective is to define the limits of the Ortacam North deposit and complete enough drilling to calculate a resource estimate by the end of the year as we continue metallurgical and environmental baseline work,” Centerra’s CEO Ian Atkinson said in a statement.
The initial resource estimate is expected to be released in early 2013.
Thus far, Oksut has seen 91 drill holes for 26,034 metres of diamond core drilling, with the bulk of those metres going into the Ortacam North deposit.
Highlight intercepts from recent infill drilling at Ortacam North included: 3.33 grams gold over 196.3 metres; 2.46 grams gold over 248.0 metres; 2.16 grams gold over 269.2 metres and 1.35 grams gold over 209.5 metres.
Preliminary metallurgical test work on oxidized and partially-oxidized material from the Ortacam North deposit yielded recoveries from 60% to 87% on material with a crush size of 100% passing 3.35 millimeters.
Oksut is located in the Kayseri region of central Turkey, roughly 50-km south of the city of Kayseri. The area has solid infrastructure with sealed roads, electricity and modern telecommunications services.
Stratex discovered gold on the property in 2007 and by 2009 had outlined six prospects that currently make up the project area: Ortacam, Ortacam North, Kizilagil, Buyukmese, Kucukmese and Devetasi.
The project is contained within an oxidized, high-sulphidation epithermal system within a central, eroded portion of an andesitic stratovolcano of Miocene age, which is overlain by Pliocene-aged, flow-banded, andesitic lava flows. The host rocks are andesitic lava flows, pyroclastic rocks and sub-volcanic domes.
Gold mineralization at Ortacam North is hosted within a large diatreme breccia body with several phases of phreatic brecciation. Higher gold grades are associated with massive silica and quartz-alunite alteration, phreatic breccia and fault zones.
Drilling has outlined a zone of oxide gold mineralization over an area up to 600 metres in length, 300 metres in width, and 200 metres thick. The mineralized zone remains open to the east and south and at depth and oxidation goes down to 420 metres below surface with gold mineralization extending to roughly 250 metres.
Beneath that oxidized zone lies gold-bearing sulphide mineralization comprised of chalcocite, covellite and pyrite.
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