Potential exists for a high margin, long life underground mining operation at the Bibiani Gold Mine which is situated in the western region of Ghana in West Africa. It is bordered by Burkina Faso to the north, Cote d’Ivoire to the west and Togo to the east.
Bibiani is owned by Mensin Gold Bibiani Limited, a wholly owned subsidiary of Resolute. Resolute currently owns 100% of Mensin Gold Bibiani Limited through its wholly owned subsidiary, Resolute (Bibiani) Pty Ltd. The Government of Ghana is entitled to a 10% free carried interest in Mensin Gold Bibiani Limited.
Since assuming ownership in 2014 Resolute has embarked on two surface and underground resource drilling programs to re-assess the underground mine potential and in June 2018 released an update to its June 2016 feasibility study. This update demonstrated the potential for Bibiani to produce ~100,000oz per annum at a Life-of-Mine All-In Sustaining Cost of US$764/oz over a 10-year mine life.
In December 2020 Resolute announced that it had agreed to sell its interest in Bibiani, through the sale of shares in Mensin Bibiani Pty Ltd, to Chijin International (HK) Limited, a wholly owned subsidiary of Chifeng, for total cash consideration of US$105 million.
Resolute and Chifeng are committed to ensuring an orderly transition of ownership at Bibiani. Chifeng is committed to injecting the necessary capital to achieve the rapid restart of Bibiani to ensure that all local and national stakeholders benefit from the economic and social advantages that the successful operation of the mine will provide. The transaction is not expected to result in any immediate changes to employment or contract relationships at Bibiani with Chifeng seeking to retain all existing local employees in future activities.
The transaction is consistent with Resolute’s strategic focus on our core operating assets together and materially strengthens the Company’s balance sheet as proceeds from the sale will be used to repay debt.
These approvals are expected to occur during the first quarter of 2021.