The Future Global Resource Limited (FGR) has acquired 90% of the Bogoso- Prestea Gold mines at a purchase price of $55 million after signing a binding agreement with The Golden Star Resources Limited.
The Chief Executive officer of FGR, Glenn Baldwin commenting on the agreement said that,
“FGR is delighted to acquire 90% of the Bogoso-Prestea Gold Mine as our first production asset. FGR is looking forward to engaging with the workforce, communities, and Government of Ghana, developing constructive and sustainable partnerships. We have confidence in the potential for additional discoveries and extensions to the underground mineral resources, through which we hope to generate real value by investing in the workforce and our relationships with local stakeholders.”
The FGR intends to review the entire Bogoso-Prestea project portfolio, which includes the significant refractory sulfide resource, and an extensive tenement package with exploration potential following its acquisition.
According to a statement sited by the Vaultz News, The Golden Star Resources Limited announced that the purchase price was $55 million with a further contingent of up to $40 million. It also said that there will be staged payments to ensure that the FGR focuses on investment capacity on the asset itself, while providing Golden Star with exposure to its long-term growth potential.
According to the statement also, operations at the Prestea underground are planned to continue, and this will include the use of Alimak mining on 24 level and long hole open stoping mining activities on the newly developed 17 Level.
President and Chief Executive Officer of the Golden Star Resources, Andrew Wray, said the sale will strengthen their balance sheet and also allow the company to accelerate the growth and development of the large resource base at the Wassa mine and increase exploration activities in the wider Wassa-HBB project area.
“We are pleased to announce the sale agreement for Bogoso-Prestea as this brings fresh focus and investment capacity to the asset, while enabling us to concentrate our financial and technical resources on accelerating the delivery of value from Wassa as it continues to develop into a large-scale, long-life and cash generative underground mine.”
“The sale strengthens our balance sheet by providing a cash inflow of $30m by 2023 and Golden Star will be able to participate in the upside offered by the Bogoso Sulfide Project through the Contingent Payment mechanism which could deliver up to a further $40 million to the business. Given the resulting improvement in the financial position of the Company we expect to now be able to accelerate our investment at Wassa and within our existing exploration pipeline and look for other opportunities to further expand our business.”
“Bogoso-Prestea will also benefit from having an owner solely focused on delivering the turnaround of the underground operation and assessing the significant potential of the sulfide resources. As a result, we see this Transaction as positive for both FGR and Golden Star, our employees, Ghana, the host communities and all of our other stakeholders.”
The transaction following the satisfaction of the closing conditions in the agreement and the obtainment of government approvals is expected to be complete by September 30, 2020.
