Vector Resources has completed the acquisition of a 60-percent stake in the Adidi-Kanga gold project in the Democratic Republic of Congo.
Vector Resources (ASX:VEC) has completed the acquisition of a 60-percent stake in the Adidi-Kanga gold project in the Democratic Republic of Congo’s (DRC) Ituri province.
The completed acquisition will see Vector form a new entity to run the project — Adidi-Kanga Resources — with joint venture (JV) partners Société Minière de Kilo-Moto and Mongbwalu Goldfields Investments.
According to the company, all necessary JV documentation, agreements and approvals have now been received and executed, giving the new JV company permission to begin site development.
As part of the deal, Vector is to make three separate payments in tranches to Mongbwalu, with the first being $5 million in cash and $5 million worth of Vector shares at a price of AU$0.022 each.
The second, to happen within 30 days of a positive decision to mine at the project, will entail another $5 million in cash and $5 million in shares or cash. The third tranche will be the same setup — $5 million in cash and $5 million in shares or cash — to take place within 10 days of the start of commercial gold sales.
Vector has already executed a loan agreement with FT General Trading for up to US$35 million; the first-tranche payment will come from this loan. In addition, Vector has submitted a loan utilization request to FT for US$5 million from the US$10-million tranche-two loan amount to begin on-site activities and work on a definitive feasibility study (DFS).
“The completion of this acquisition and the associated debt funding has been an exhaustive process for the company, but one well worth the wait and provides the platform for Vector to make the transition into one of Africa’s top gold producers,” Vector Chairman Gary Castledine said in a statement.
Under the terms of the acquisition and JV agreement, Vector is to complete the DFS within nine months of the completion of the acquisition.
AngloGold Ashanti (JSE:ANG) previously put over US$520 million into exploration and development efforts at Adidi-Kanga between 2005 and 2013. This included over 173,000 meters of diamond and reverse-circulation drilling, a completed feasibility study and initial mine construction activities.
However, the project was placed on care and maintenance in 2013 so the company could focus on its Kibali gold operation, with the company later selling its stake in the mine to Fimosa Capital in 2015.
Adidi-Kanga has a mineral resource estimate of 15 million tonnes at 6.6 grams per tonne (g/t) gold for 3.2 million ounces of contained gold. This includes 46 percent in the indicated category for 6.9 million tonnes at 6.74 g/t gold for 1.5 million ounces, and 8.1 million tonnes at 6.6 g/t gold for 1.7 million ounces in the inferred category.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.