(Alliance News) - Ariana Resources PLC on Wednesday said second quarter income and production from the Kiziltepe gold mine in Turkey declined quarter-on-quarter.
Shares in Ariana were up 5.0% at 2.10 pence in London in morning trade.
Kiziltepe is part of Ariana's Red Rabbit joint venture with Proccea Construction Co, with Ariana's stake being 50%.
Gross income from Kiziltepe for the three months ended June 30 was USD9.7 million at a USD1,307 per ounce average realised gold price. This was down from USD10.9 million at an average realised gold price of USD1,311 per ounce in the previous quarter ended March.
Kiziltepe production fell quarter-on-quarter to 6,438 ounces of gold from 7,296 ounces.
First half production totalled 13,734 ounces of gold, in line with Ariana's annual guidance for 25,000 ounces.
Operating cash costs for the second quarter are expected to be USD589 an ounce, including the annual state right for 2018 which was paid in the quarter.
The firm is on track to repay its USD33 million capital loan for Kiziltepe by April 2020 and has repaid 69% of it so far.
Ariana Managing Director Kerim Sener said: "The second quarter results from the Kiziltepe mine continue to reflect positively on the performance of our flagship operation. Operating cash costs per ounce for the period are higher than in prior quarters, largely due to the annual payment of the state right royalty to the Turkish government within the period. Excluding this, the operating cash cost remains fully in line with prior quarters. High strip ratios have been maintained in to the current quarter during the pushback of the southern pit wall at Arzu South, but these will decrease during Q3 and Q4.
"We remain encouraged by the rallying gold price, which today sits at USD1,542 per ounce. During the July and August period the gold price is up c.10% and this increase will be reflected in our Q3 results."
Ariana (AAU)