EAST AFRICA – Shanta Gold Limited, an East Africa-focused gold producer, has completed its acquisition of the Acacia Exploration (AEKL) Kenyan gold assets from Barrick Gold.

It follows the receipt of regulatory approvals in Kenya, which now satisfied all remaining closing conditions of the transaction.

The primary asset is the West Kenya project, which has a resource currently pegged at just under 1.2mln ounces. With a grade of 12.6 grams per tonne, the project has been described as ‘the highest grade million ounce-plus project under development anywhere in Africa’.

The transaction comprises a contingent cash payment of US$7million in cash, along with US$7.5million of Shanta shares issued to Barrick (price marked at 10.5p each) and the award of a 2% life-of-mine net smelter royalty to Barrick. Shanta also inherits certain liabilities of AEKL, the net effect being a US$1.6 million sum payable to third parties.

Barrick now holds a 6.4% shareholding in Shanta, and the consideration shares are subject to an 11-month ‘lock-up’.

“The West Kenya acquisition is significant for Shanta Gold, creating an East African Gold mining champion with realisable growth prospects and high asset quality across three attractive gold projects,” Eric Zurrin, Shanta chief executive said in a statement.

“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.

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

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 it will pay KSh749 million (US$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.

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