Canada-based precious metals explorer and developer Montage Gold is expanding its Koné gold project, in Côte d'Ivoire, with the acquisition of a 100% interest in the Mankono-Sissédougou joint venture (JV) project from Barrick Gold and Endeavour Mining for C$30-million in cash and shares.
Mankono consists of three properties – the Sissédougou exploration permit, the Gbongogo permit application and the Sisséplé permit application – all lying within the perimeter of the Koné project.
The Gbongogo permit application area has been explored by Randgold Resources (now part of Barrick) since 2013 and the Sissédougou and Sisséplé areas by Endeavour and previously La Mancha Resources since 2010.
“This is an important step for Montage, with the addition of Mankono, our consolidated land position at the Koné gold project will increase to over 2 250 km2 in one of the most prolific belts in West Africa,” said CEO Hugh Stuart.
He stated that previous exploration had identified a number of target areas and Montage intended to explore these targets aggressively with the objective of adding high-grade satellite feed into Koné.
In terms of the transaction, Montage would acquire the JV project for C$14.5-million in cash and 22.14-million shares, priced at C$0.70 each, as well as a 2% net smelter return royalty.
The consideration would be split pro-rata on a 70:30 basis between Barrick and Endeavour.
To pay the cash portion of the consideration, Montage announced that it would raise C$20-million on a bought-deal private placement basis of 28.6-million subscription receipts.
Closing of the transaction is subject to the award of the Gbongogo exploration permit, which is currently in application. The agreement provides for an outside closing date of December.
Barrick and Endeavour would own 9.93% and 4.26% of Montage, respectively, post-closing.