Half of the Asanko gold mine in Ghana now belongs to Gold Fields
Mining News Pro - Ghana’s Asanko Gold Mine is a multi-deposit complex, with two main deposits, Nkran and Esaase, and nine satellite deposits.
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South Africa’s Gold Fields (JSE, NYSE: GFI) and Canada’s Asanko Gold (TSX: AKG) announced the completion of the joint venture deal that gave the former a 50 per cent stake in Asanko’s 90-per-cent-interest Asanko gold mine.

The mine is one of Ghana’s newest gold operations and it is located in the country’s Ashanti Region. Both companies have set up a number of working groups whose objective is to make sure that the mine reaches its expected production guidance of 253koz in the 2019-2023 period and operates efficiently throughout its expected life of 15 years.

“The closing of the transaction with Asanko gives us exposure to a great camp, with long-life, low-cost production, with significant exploration potential in a country we know well and have operated in for 25 years,” Gold Fields CEO, Nick Holland, said in a media statement.

The $185-million partnership implies that Gold Fields paid $165 million upfront on closing of the transaction and will do a deferred payment of $20 million no later than December 31, 2019. Its local unit has also agreed to subscribe to a 9.9 per cent share placement in Asanko by way of a private placement of 22,354,657 Asanko shares at a price of approximately $0.79 cents.

For the South African miner, whose net debt stood at $1.3 billion at the end of its last financial year, the deal is part of a growth strategy focused on improving its portfolio by lowering all-in costs and extending mines` lifespans to enhance cash generation.

For the Canadian miner, on the other hand, the closing of the JV provides some relief as the money was used to repay in full all outstanding principal and accrued interest ($164 million) it owed to its lender, Red Kite.

“Today marks an important milestone for Asanko as we conclude our JV Transaction with Gold Fields and emerge completely debt-free, with a strong partner, a solid long life production base, competitive cost profile, fully funded organic growth and significant exploration potential,” the President and CEO of the Vancouver-based company, Peter Breese, said in a press release.

Asanko will remain the operator of the asset, although Gold Fields wants to establish a joint steering committee that would oversee budgets and planning.


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