Gold mining company Chaarat has formed a joint venture (JV) with Turkish mining and mine construction contractor Çiftay to collaborate on the Tulkubash and Kyzyltash projects in Kyrgyzstan, the Aim-quoted firm announced on Monday.
Çiftay, which has been Chaarat’s partner since 2017, and mobilised equipment to the Tulkubash site last year, would be appointed as construction and long-term mining contractor for the project.
Under the agreement, based on an agreed valuation of $252-million for the two assets, Çiftay would also progressively invest $31.5-million for a 12.5% equity stake in the Tulkubash and Kyzyltash projects.
This, Chaarat said, would provide a significant amount of the required equity for the Tulkubash project. The project’s total capital expenditure is estimated at between $120-million and $130-million, and after the Çiftay equity investment the vast majority of the remaining capital expenditure is expected to be debt funded.
Chaarat was in the process of securing the remaining project financing and said that it aimed to have this in hand by the third quarter. In anticipation of closing the financing, Çiftay would start earthworks at Tulkubash.
First gold production at Tulkubash is forecast for 2021.