PERTH (miningweekly.com) – Gold miner Resolute Mining has struck a $105-million sales agreement with China’s Chifeng Jilong Gold Mining Co for its Bibiani gold mine, in Ghana.
The project was acquired by Resolute in 2004, and was placed on care and maintenance shortly after, to allow exploration activities to enable the development of an economically viable, long-term, large scale operation.
Resolute in January this year launched a review of the asset to consider the benefits of continuing operations at Bibiani, or to consider if another company would be better placed to continue with Bibiani.
The company said on Tuesday that Chifeng intended to progress the redevelopment of Bibiani as soon as is possible.
"Resolute is proud of its contribution to Ghana and pleased that our investments at Bibiani in exploration, feasibility studies, and community support will provide a strong base for future success and value creation.
“I am confident that Resolute's positive legacy in Ghana, and the interests of all stakeholders in Bibiani, will be protected and enhanced under Chifeng's ownership,” said Resolute’s interim CEO Stuart Gale.
"The transaction is consistent with our strategic focus on our core operating assets together with balance sheet improvement."
A 2018 feasibility study into a Bibiani restart estimated that the project could produce some 100 000 oz/y over a ten-year mine life, at a total capital cost of around $115-million.
The project is currently estimated to host some 21.7-million tonnes, grading 3.6 g/t gold for 2.5-million ounces of contained gold.
“We are delighted to have secured such a significant gold mining asset in the current market. Resolute has defined an exciting future for Bibiani as a high margin, long life underground gold mining operation.
“Chifeng will immediately invest the required capital, and provide the necessary expertise, to recommission Bibiani as an operating gold mine in the shortest possible timeframe,” said Chifeng's executive chairperson Wang Jianhua.
The $105-millionc ash consideration would consist of a $5-million deposit on the signing of the agreement, and a $100-million payment on completion of the transaction, which is expected in March next year.
The transaction is subject to a number of conditions, including Australian Foreign Investment Review Board approval, and Chinese and Ghanaian government approvals.