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Stratex International Plc / Index: AIM / Epic: STI / Sector: Mining


Stratex International Plc  

(‘Stratex’ or ‘The Company’)

Altıntepe Gold Project, Turkey –

Mine Construction Nearing Completion


Stratex International Plc, the AIM-quoted exploration and development company, is pleased to provide an update on the construction of its Altıntepe gold mine located in Turkey (‘Altıntepe’ or ‘the Project’). Construction is expected to be completed before the end of 2014, and first gold pour is anticipated in the first quarter of 2015.

Located close to the Black Sea coast of northern Turkey with excellent infrastructure, the Altıntepe epithermal gold deposit has an in-house resource of 593,131 oz gold and 3,184,508 oz silver (measured, indicated and inferred). Stratex is free-carried to production through their joint-venture partner Bahar Madencilik (‘Bahar’) and will receive 20% net cash-flow during an initial payback period and 45% subsequently.



·                Recovery of approximately 110,000  oz Au from the Çamlik East oxide resource planned over 34 months in Stage 1;

·                Extended mine life anticipated as remaining deposits brought into production;

·                Based on preliminary financial modelling, an all-in sustaining cash cost of US$530/oz will  deliver taxable operating income for the Project of US$74.7 million for the first 34 months of production at the Çamlik East zone;

·                Over 300% return on Stratex’s initial US$1.5 million investment, from Stage 1 production alone;

·                Agreed construction cost is US$39 million;

·                Crusher, grasshopper conveyor system, leach pad, and ponds under construction;

·                Installation of a 5 km power line and transformer station complete;

·                Foundations in place for ADR (adsorption, desorption, recovery) plant and assay laboratory and construction underway;

·                Bahar to undertake contract mining;

·                Metallurgical drilling programme in progress on Extension Ridge zone to improve confidence level of resource and provide material for metallurgical testwork; and

·                Excellent tax incentives secured for the Project.


Bob Foster, Stratex Chief Executive Officer, said: “Following a recent site visit and project review with Bahar, we are delighted to provide updated details of mine development. Following award of the Forest Permit, Altıntepe Madencilik, our 45%-owned operating company, has made excellent progress in clearing the site and advancing the construction programme. Procurement of all of the necessary plant equipment has been completed and Stratex looks forward to being completely free-carried to production.

“At this stage Bahar advise that they expect the construction will be completed before the end of the year. The Project’s in-house financials, with an all-in sustaining cash cost of US$530/oz and an initial indicated taxable operating income of US$74.7 million, are robust, especially so given that this is based on first-phase production from only the Çamlik East zone, whereas we anticipate an extended mine life as the additional zones are exploited”.

Further Details

Following approval of the Forest Permit (press release dated 31 March 2014) at Altıntepe, Bahar has made rapid progress in terms of site clearance and ground works, including the installation of a 5 km power line and transformer station. Bahar has also completed sterilisation (condemnation) drilling to ensure that no construction takes place on gold-bearing ground.

A range of technical and engineering studies are now complete, including pit optimisation and mine scheduling, and the Altıntepe operating company Altıntepe Madencilik Sinayi ve Ticaret Ltd Sti (‘Altıntepe Madencilik’ - 55% Bahar, 45% Stratex) has defined the following plant specifications based on a 500 tonnes per hour (“tph”) crusher circuit:

·         A three-stage crushing and screening unit producing minus 12 mm material;

·         A 300 tonnes per hour mobile stacking and agglomeration unit;

·         An ADR plant capable of treating 340 m3/h of pregnant (gold-bearing) solution and a total refining capacity of 150,000 oz per annum, although the initial gold recovery is only targeted at 30,000 – 40,000 oz per annum; and

·         A heap leach pad with an initial load capacity of three million tonnes.

Bahar advise that construction will be completed before the end of the year, unless any unforeseen obstacles are encountered and assuming weather conditions allow work to continue on site for at least 60 days. First gold pour is anticipated during Q1-2015. The minimum annualised production rate of 30,000 oz gold per annum should be achieved later in 2015. During Phase 1, 109,741 oz oxide gold will be recovered from the Çamlik East zone, with an initial mine life of 34 months, but it is anticipated that exploitation will then be extended to other significant mineralised zones that have been defined previously by Stratex, with Extension Ridge being prioritised and drilling completed to provide material for metallurgical testwork that is now underway. Exploitation of the  larger gold resource in Extension Ridge and the other mineralized zones will likely lead to a much-extended mine life but the extent of the exploitation and ultimate project modelling await the outcome of ongoing resource and processing studies. 

Processing of ore from Çamlik East shall comprise three-stage crushing, agglomeration, and stacking via grasshoppers. Construction of the crusher units, grasshopper stacking system, leach pad, and ponds is well-advanced. Cyanide will be added at the agglomeration stage, which will enhance the kinematics of the leaching process and reduce recovery time. The heap will be irrigated with cyanide solution via drippers and gold recovered from the pregnant solution by an ADR plant and production of gold/silver doré bars via electro-winning and smelting.

Production is planned on the basis of a 365 days per year operation, with one shift per day for mining, crushing and stacking resulting in lower operating costs. Security and some process operations will operate 24 hours per day.

Following a detailed review of the construction costs by Stratex and independent international consultants GBM Minerals Engineering Consultants Limited, Altıntepe Madencilik has agreed to a lump sum pre-production construction cost of US$39 million. This is a fixed cost and Bahar will cover any related overspend at its cost. Bahar will accept all technical and financial liability until completion of construction. It is also estimated that additional indirect capex will be required and an estimate of US$8.5 million has been incorporated into this provisional model.

Contract mining will be provided by Bahar, incorporating drill, blast, load, haul, and dump at the crusher. Altıntepe Madencilik will be responsible for all other elements including mine planning, grade control, processing, and delivery of the doré bars (semi-pure bars of gold and silver) to a refinery for further purification.

Stratex is free-carried to production and, following completion of construction, Bahar will receive 80% of net cash flow until it has recovered its investment, with 20% of net cash payable to Stratex. Subsequently, net cash will be disbursed on the basis of 55% to Bahar and 45% to Stratex.

Altıntepe Madencilik has secured excellent tax incentives for the project:

·         Exemption from customs duty domestic and foreign machinery and equipment (100% exemption);

·         80% reduction in corporation tax up to a tax limit of 40% of the capital investment;

·         Social insurance contributions for all mine employees will be paid by the Turkish Government for 7 years;

·         Interest repayment support on any Turkish Lira or foreign currency loan secured by the company; and

·         VAT exemption domestic and foreign machinery and equipment (100% exemption).


In-house financial modelling based on a gold price of US$1,200 per ounce and an all-in sustaining cash cost of US$530/oz indicates a taxable operating income for the Project of US$74.7 million for the first 34 months of production focused on Çamlik East. Due to a lag time between the start of production and the sale of gold, it is anticipated that additional revenues from the final 3 months of gold production (not included in the above operating income) will be received after the initial 34 months. An update on the financial modelling will be provided as the Project nears production and capital and operating parameters can be defined more precisely.

Prior to Bahar earning-in to the Project, Stratex had only spent US$1.5 million on exploration and hasn’t had to commit any subsequent funding towards its development. As such, the return on the Company’s initial investment, based solely on Stage 1 production at the Project, already stands at over 300%.

For further information on Altıntepe, including recent photos of the development progress at the project, please visit our website at

Bob Foster, Chief Executive Officer, is a Competent Person as defined by various international instruments and takes responsibility for the release of this information.


* * ENDS * *


For further information please visit, email [email protected], or contact:


Stratex International Plc

Tel: +44 (0)20 7830 9650


Bob Foster / Christopher Hall / Claire Bay



Grant Thornton UK LLP

Tel: +44 (0)20 7383 5100


Philip Secrett / Melanie Frean / Jen Clarke




Northland Capital Partners Limited

Tel: +44 (0)20 7382 1100



Gavin Burnell / Matthew Johnson / Alice Lane /John Howes




SP Angel Corporate Finance LLP

Tel: +44 (0)20 3463 2260



Ewan Leggat / Tercel Moore




Yellow Jersey PR Limited

Tel: +44 (0)20 3664 4087


Dominic Barretto / Philip Ranger / Anna Legge





Notes to editors:

Stratex International is a well-funded AIM-quoted exploration and development company focussed on gold and high-value base metals in Turkey, East Africa and West Africa. Since listing on AIM in 2006, Stratex has had an impressive track record of successful exploration supported by joint-venture partnerships, both with major international mining companies and local companies to maximise the potential of its discoveries.


In December 2012 the Company announced the sale of its 30% interest in the Öksüt gold project for cash of 20 times its original US$1 million investment and retained a royalty of 1% up to a maximum additional value of US$20 million.

To date Stratex has discovered more than 2.2 million ounces of gold and 7.9 million ounces of silver, as well as 186,000 tonnes of copper. The Company has a robust cash balance and is therefore well-placed to advance its existing exploration programmes and is also actively seeking to acquire advanced projects that are at the drill-ready stage or even have identified resources, particularly in East Africa and West Africa.


Preliminary financial model assumes constant gold price of US$1200 per ounce, discount rate of 10% and other assumptions.

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