Gold explorer and developer Asante Gold Corporation is considering cash bids for a 100% buy-out of its Kubi gold project in Ghana.
This follows the company’s announcement that it was sourcing a 50:50 joint venture partner for the exploration and development of Kubi.
The joint venture or buy-out consideration is a result of a lack of available funding. Asante Gold Corporation says that financing Kubi through either debt or equity have proven challenging through this long bear gold market, and hence with the recent increase in gold related M&A activity, the company concluded that the joint venture or buy-out route will maximise its returns.
Once funded, Asante will commence aggressive exploration of Betenase located just to the south of Obuasi and its other high potential gold exploration concessions, including Keyhole, on the Asankrangwa gold belt in Ghana.
Finders fees may be payable on a success basis, and any transfer of mineral title interests in Ghana will require Ministerial approval.
On closing of a JV or a buy-out, Asante Gold Corporation will complete the purchase of Kubi from Goknet Mining Company of Accra, by the issuance of 7 million treasury shares, and by reserving for future delivery 8 000 oz of gold and a 1% net smelter returns (NSR) royalty.
Royal Gold Inc. of Denver holds a 3% net proceeds of production royalty (net profits after all costs including taxes and royalties), and the Ghana Government holds a statutory 10% free carry equity (10% of any declared dividend) and 5% NSR royalty interest.
The Kubi gold project has a NI 43-101 compliant resource estimate which includes a measured resource of 0.66 Mt grading at 5.30g/t for 112 000 oz of contained gold; an indicated resource of 0.66 Mt grading at 5.65g/t for 121 000 oz of contained gold; and an inferred resource of 0.67 Mt grading at 5.31g/t for 115 000 oz of contained gold.