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Central Asia Resources granted mining approval for Kazakhstan gold project

Central Asia Resources granted mining approval for Kazakhstan gold project

Central Asia Resources (ASX: CVR) has received approval for pilot mining of 145,000 tonnes of ore from its Dalabai project in Kazakhstan and is aiming to commence gold production in fourth quarter 2011.

The approval was received from the State Committee for Mineral Reserves of the Republic of Kazakhstan. Drilling and other work is continuing on schedule for full mining approvals.

The company plans to commence mining in the third quarter and to produce 20,000 ounces (oz) gold and  140,000oz silver per annum, starting in the fourth quarter.

The estimated mine life is 2.5 years and there is significant exploration upside. The project has a capex of US$10.7 million, cash costs of US$545/ounce and a projected net cashflow (2.5 years, undiscounted) of US$37.7 million.

The company has made significant progress in May with several development milestones achieved including the construction and inspection of a crusher which is in transit from China.
IT and communications design has been completed and its implementation started. Additional accommodation units have been added to camp and a heap leach pad prepared and geomembrane delivered.

The first shipments of the adsorption circuit have been delivered and a factory construction contract has been awarded.

An upgraded Resource statement for Dalabai is being finalized. The Dalabai Resource is currently 1.9 million tonnes (Mt) at 1.56 grams per tonne (g/t) for 97,000 oz of gold, at 21.8 g/t for 1.36Moz silver.

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