PERTH (miningweekly.com) – Gold developer Vector Resources is hoping to complete a definitive feasibility study (DFS) on the Adidi-Kanga gold project, in the Democratic Republic of Congo, during this year, after settling the acquisition of a 60% interest in the project.
The ASX-listed Vector in July last year struck a deal with Mongbwula Goldfields Investments to acquire the majority share in the project in exchange for a number of milestone payments.
The company said on Friday that the first tranche payment was now proceeding, consisting of $5-million in cash and a further $5-million in Vector shares, priced at 2.2c a share.
The share issue will be subject to ASX approval, as shareholder approval was granted more then three months ago. If the ASX does not approve the share issue, the company will be required to seek shareholder approval as soon as practical.
A second tranche payment of a further $5-million in cash and $5-million in either cash or Vector shares will also become due to Mongbwula on a positive decision to mine, while a third tranche payment of a further $5-million in cash and $5-million in either Vector shares or cash, will become payable on the start of commercial gold sales.
Vector has previously secured debt of up to $35-million from Dubai-based FT General Trading to fund the acquisition, DFS and development associated with the Adidi-Kanga project. The first tranche cash payment will be made from this loan amount, with Vector also submitting a loan utilization request for a further $5-million from the available $10-million from the Tranche 2 funding.
The Tranche 3 funding, consisting of a further $20-million, will become available on the completion of the DFS and a positive decision to mine.
Vector CFO Andrew Steers told Mining Weekly Online on Friday that the DFS would take some nine months to complete, and will be based on an initial 80 000 t/m operation, as considered by previous owners AngloGold Ashanti.
Between 2005 and 2013, AngloGold Ashanti spent some $520-million on exploration and development activities at Adidi-Kanga, completing a feasibility study and starting initial mine construction and activities, which included the purchase and installation of some 70% of the mechanical equipment proposed to be installed under the feasibility study.
“A lot of work has already been done by AngloGold Ashanti, especially on the processing side, so our focus for the DFS will be on the mining side of the operation, and optimising that,” Steers said.
The Adidi-Kanga mine has a Joint Ore Reserves Committee-compliant resource of 15-million tonnes, grading 6.6 g/t gold for 3.2-million ounces of gold.