Private equity group Ibaera Capital GP has signed a joint venture (JV) agreement to acquire up to 47.5% in Azumah Resources’ Wa Gold project in Ghana, West Africa.
Under the terms of the agreement, which will be executed in a two-phase manner, Ibaera needs to pay $13.5m over two years in exchange for the interest.
Through the investment, Azumah aims to enhance gold resources and reserves above the existing 2.1Moz and 624,000oz respectively.
The parties are also targeting a revised feasibility study within two years in order to secure funding and develop the project, which has a proposed 90,000oz per year gold operation plan.
Azumah Resources managing director Stephen Stone said: “This transaction represents a game changer for the company and another important step in unlocking fundamental value and achieving a market rerating.”
Ibaera can initially earn the right to acquire a 42.5% interest after spending $11.25m.
In the event of insufficient funds to achieve the objectives of the JV, Ibaera needs to solely fund the remaining $2.25m to earn a further 5% interest to take its total interest in the project to 47.5%.
The parties will thereafter jointly work towards arranging funds for project development activities with regard to the project.