Resolute snaps up 2 prime gold projects from AngloGold Ashanti in Côte d’Ivoire

Resolute snaps up 2 prime gold projects from AngloGold Ashanti in Côte d’Ivoire

Caroline Smith

The Market Online, Australia

Resolute Mining Ltd (ASX:RSG) is set to acquire 2 gold projects in Côte d’Ivoire currently held by AngloGold Ashanti for US$150 million, expanding its footprint in the country which is host to several major gold projects.

The company has entered into a binding agreement to acquire the Doropo and ABC projects for the above amount, with the payment comprising an upfront cash consideration of US$25M upon closing the deal, followed by a US$125M deferred cash consideration paid in 2 instalments.

The latter will see Resolute pay US$50 million and US$75M, 18 months and 30 months after closing respectively. This transaction will also involve a 2% royalty over the ABC project, plus a contingent payment of US$10M which is to be paid upon release of a feasibility study which shows a mineral reserve of more than 1 million ounces of gold.

Resolute will also transfer its total exploration permits in Guinea to AngloGold – subject to government approval – or US$25M if this is not completed within 18 months.

In terms of the projects themselves, Doropo – located in the country’s northeast – is at the definitive feasibiliy study (DFS) stage, and holds a mineral reserve of 1.88 million ounces (Moz) at a grade of 1.53 grams per tonne (g/t).

It is expected to facilitate an open pit operation, with a production rate of 167koz per annum at an average AISC (all-in sustaining cost) of US$1,047/oz over 10 years.

By contrast, ABC is a greenfield exploration project which holds an inferred mineral resource estimate (MRE) of 2.16Moz at 0.9 g/t of gold.

Resolute has been trading at 51 cents.

Caroline Smith

The Market Online, Australia

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