PERTH (miningweekly.com) – Gold miner West African Resources (WAF) has closed its earlier announced share purchase plan (SPP) three times oversubscribed.

The miner earlier this month launched an SPP aimed at raising A$10-million, as part of its funding initiative for the acquisition of a 90% interest in the Kiaka gold project, in Burkina Faso.

WAF said on Monday that the company had received strong demand for the SPP, with subscriptions well exceeding A$30-million.

“We are pleased with the strong response to the SPP from our shareholders and look forward to commencing work at Kiaka in early 2022,” said executive chairperson Richard Hyde.

With the addition of Kiaka to existing operations, WAF aims to a be a 400 000 oz/y gold producer by 2025.”

Kiaka is a large‐scale, permitted development project containing a 6.8-million-ounce gold mineral resource, and a feasibility study update is underway targeting a six-million to eight-million processing rate. Construction early works are expected to start in Q1 2022, including camp, access road and community projects, and major works are expected to start in mid‐2022.

WAF in October struck a deal with B2Gold and its partner GAMS-Mining F&I to acquire a 90% stake in the project, with the remaining 10% interest to be held by the State of Burkina Faso.

Under the terms of the agreement, WAF would pay $100-million in staged cash and share payments, comprising of $55-million, made up of 50% cash and 50% WAF shares to be paid on closing of the transaction, with a further $45-million payment in cash or shares to be paid on the deferred consideration payment date.

A 3% net smelter royalty would also be payable on the first 2.5-million ounces of gold produced from Kiaka, and a 0.5% net smelter royalty on the next 1.5-million ounces of gold produced at the mine, which is located 45 km south of WAF’s Sanbrado project.

To fund the transaction, WAF conducted a placement to raise up to A$126.39-million. Firm commitments were received for the first tranche placement, consisting of 101-million shares, priced at A$1.25 each.

A second tranche placement, to raise up to A$140 000, will be subject to shareholder approval at the company’s general meeting, scheduled for mid-December.