Asante Gold (ASE.V) has announced it has signed an agreement with Goknet to form a 50/50 joint venture to develop the Kubi gold project in Ghana. Asante must issue 2 million shares to Goknet and must fund the JV-co with $2M in cash within the next 4 months after the closing date, with a commitment to provide another $13M within two years.
Asante has the option to increase its interest in the Kubi project to 75% if it issues 10 million shares or either the greater of $10M in cash or the value of 8,000 ounces of gold. A second option will allow Asante to increase its stake in the JVco to 100% by issuing an additional 5M shares and granting a 2% NSR.
This isn’t exactly a cheap deal, so we hope Asante Gold knows what it’s doing. The project location is quite good as it’s within 15 miles from two large producing mines, and the total resource estimate on the property contains almost 350,000 ounces of gold at an average grade of approximately 5.4 g/t which isn’t bad at all.
> Click here to go to Asante’s website
Disclosure: The author holds no position in Asante Gold. Please see our disclaimer for current positions.
