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A sector that was once racing to build new supply has been closing mines and deferring projects as low prices bite into the cost curve.
Australia’s Resolute Mining (ASX, LON: RSG) has agreed to sell its Bibiani gold mine in Ghana to China’s Chifeng Jilong Gold Mining for $105 million cash.
The Western Australia-based miner has received a $5 million deposit upfront, with the remainder expected upon completion of the transaction, which is expected in March 2021.
The company acquired Bibiani in 2004 but placed the mine on care and maintenance shortly after to allow exploration activities to develop the asset into a large-scale operation.
Bibiani’s sale reduces Resolute’s portfolio to two gold assets: Syama, in Mali and Mako, in Senegal
Resolute changed tune in January this year, launching a review of the mine to determine whether to keep it or sell it to a company “in better place” to keep the gold mine running.
Chifeng noted on Tuesday it would immediately invest the required capital and provide the necessary expertise to recommission Bibiani as an operating gold mine in the shortest possible time frame.
“I am confident that Resolute’s positive legacy in Ghana, and the interests of all stakeholders in Bibiani, will be protected and enhanced under Chifeng’s ownership,” Resolute’s interim chief executive officer, Stuart Gale, said in the statement.
Resolute sold in January its Ravenswood gold mine in Queensland — the only Australian asset it had — to private equity firm EMR Capital Management. The $207 million deal left the company with three mines in Africa — Syama in Mali; Mako in Senegal; and Bibiani.
Bibiani’s sale would reduce Resolute’s portfolio to only two assets and is subject to a number of conditions. Those include the approval of the Australian Foreign Investment Review Board as well as Chinese and Ghanaian government authorizations.
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Emmanuel Asubonteng
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