Australia-based Resolute Mining has agreed to sell its Bibiani gold mine located in Ghana to Canada’s Asante Gold for a total of $90m in cash.
Under the terms of the agreement, Asante will make an initial payment of $30m, additional $30m on or before 6 months, and final $30m within12 months from completion.
Resolute intends to use the initial cash receipt of $30m for voluntary repayment of debt.
The agreement and transaction have been approved by the Ghana’s Minister of Lands and Natural Resources, and is expected to complete within 10 days.
Resolute said that the transaction is in line with its strategic focus on core operating assets, and would not involve any immediate changes to employment or contract relationships.
Resolute managing director and chief executive officer Stuart Gale said: “Resolute has made a commitment to deliver sustainable and enduring value to shareholders and to the communities in which we operate.
“Resolute is proud of its contribution to Ghana and particularly proud to have the opportunity to transfer ownership in Bibiani to a highly regarded team with strong ties to Ghana.
“I would once again like to reiterate my sincere gratitude to the Minister for his leadership, sense of integrity and collaboration with Resolute and Asante to achieve a mutually beneficial outcome for all parties.”
Bibiani is a historically significant gold mine, situated in the western region of Ghana.
The property features mining and processing infrastructure including a 3 million tonne per annum mill and processing plant, and existing underground mining infrastructure.
In 2014, Resolute purchased Bibiani through a Scheme of Arrangement supported by the Ghanaian Government, and placed the mine on care and maintenance.
In July 2018, the company has launched an updated feasibility study for Bibiani, which indicated mineral resources of 21.7 million tonnes at 3.6 grams of gold per tonne for 2.5 million ounces of gold at Bibiani.
Asante is engaged in developing high margin and low CAPEX gold projects including the Kubi Gold Project located on the Ashanti Gold Belt.
The company has committed to pump necessary capital investment to support rapid restart of Bibiani mine.
Asante president and CEO Douglas MacQuarrie said: “Resolute has reported 2.5Moz of gold in current Mineral Resources and Asante has recognized additional exploration upside potential, both from near surface and underground targets.
“It is Asante’s intention, as far as is reasonably practicable, to continue building on the excellent base which Resolute has established.
“Asante is already building the management and operations team with a view to bring the Bibiani mine to production within the next year. Further discussions are underway to fully fund the acquisition and its’ development using non- dilutive financing.”
