Firstly, I agree, it is a win/win for all stakeholders, particularly the people of Burkina Faso, as I believe that their Government would be very pleased to see another project get developed, versus having B2Gold and others sit on the asset for at least 15+ years....
Regarding the price. I simply look at what was paid for CDVs Namdini project in Ghana which was bought out in a T/O. The deposit had an MRE of 6.99m ounces (so just 3% more than Kiaka) with a grade barely 10% higher than Kiaka. Yet the price paid for the asset was just shy of $600m AUD (or around $470m USD). That is before any development occurred. The Feasibility study of 2019 estimated capex of $390m USD (but I believe this excludes pre-production expenses), for a 9.5mtpa plant. I imagine the costs have since risen further since 2019.
Interestingly, I think CDVs Nandini project is very similar to Kiaka, thought it is lower stripping.
So I feel the price paid is really, far less than what the buyer of Namdini paid. Particularly the upfront payment. The cash/shares equals $100m USD. The MRE is cuttoff at 0.5g/t (many projects worldwide now use 0.3g/t, particularly in Australia). Just $14 USD an ounce. For a project that is going to see development begin almost instantly, is a great result for WAF shareholders. I do agree that B2Gold also get to share in some of the upside via their 7% holding.
While you are right about the total cost at current prices (POG), I feel that your figure of $250m, is somewhat overblowing it, so to speak, as its such a trailing payment. It basically just reduces the spot sale price by 2.7%, over the life of the project. For me, WAF just doubled their MRE, more than doubled their reserves (thought that will take time to lock in), enabled them to more than double their production profile and all for what will hopefully be a full post gold price of approx $600m USD.
Looking forward to WAF being able to hit the ground running with Kiaka and start really explaining to the market what they plan to do with it.
WAF Price at posting:
$1.40 Sentiment: Buy Disclosure: Held
(20min delay)