Companies

Firm buys out Canada miner’s Kenya assets

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Summary

  • East Africa-focused gold producer Shanta Gold has completed the acquisition of Canadian miner Barrick Gold's assets in Kenya at a cost of Sh1.4 billion.
  • The London AIM-listed miner said Wednesday it will consequently move to fast-track gold production in Western Kenya where Barrick held licences for rights to mine gold over a 1,161 square kilometre area that straddles Kakamega, Kisumu, Siaya and Vihiga counties.
  • The area has gold deposits estimated at 1.1 million ounces, with a current market value of Sh186 billion.

East Africa-focused gold producer Shanta Gold has completed the acquisition of Canadian miner Barrick Gold's assets in Kenya at a cost of Sh1.4 billion.

The London AIM-listed miner said Wednesday it will consequently move to fast-track gold production in Western Kenya where Barrick held licences for rights to mine gold over a 1,161 square kilometre area that straddles Kakamega, Kisumu, Siaya and Vihiga counties.

The area has gold deposits estimated at 1.1 million ounces, with a current market value of Sh186 billion.

“With the receipt of regulatory approvals in Kenya, including standard consents from the Mining Authorities to the assignment of interests and the transfer of prospecting licences, and approval of the transaction by the Competition Authority of Kenya, all of the closing conditions for the Transaction are now satisfied,” said Shanta CEO Eric Zurrin in the statement.

The Canadian miner Barrick Gold Corporation announced In February this year it was selling its seven Western Kenya gold mining licences to the Guernsey-incorporated Shanta Gold in a cash-and-stock transaction worth a total of Sh1.4 billion.

Shanta confirmed yesterday it will pay Sh749 million ($7 million) to Barrick in cash adding that Shanta would also pay Barrick a two percent royalty rate, based on actual gold production in the future.

“We are committed to responsibly investing in Kenya and working with the Government, communities and local stakeholders,” said Mr Zurrin.

Shanta said the western project has one of the highest grading gold deposits in Africa.

“Now that the transaction is complete, we are turning our focus to integrating West Kenya into the Shanta portfolio and accelerating progress on the ground with plans to begin infill drilling and to further delineate the resource potential,” said Mr Zurrin.