Australia's Resolute Mining (LSE: RSG; ASX: RSG) is selling its Bibiani gold mine in Ghana to Canada's Asante Gold (TSXV: ASE) for US$90 million in cash.
The company will receive an initial US$30 million payment, followed by another US$30 million on or before six months from the transaction close. The final US$30 million will be paid on or before a year from completion, Resolute said.
The Western Australia-based miner had inked a US$105 million sales deal in December with China's Chifeng Jilong Gold Mining, which fell flat after Ghana suddenly cancelled the mining lease, ordering Resolute to halt operations.
Chifeng walked away, even though the lease was subsequently restored, saying it had not received timely information about the termination of the mining lease.
The deal would have marked the Chinese miner's second overseas acquisition, after it bought a 90% stake in the Sepon gold and copper mine in Laos in 2018.
Resolute said the deal with Asante has already been approved by Ghana's minister of lands and natural resources, adding that it expected to complete it in the next ten days.
Bibiani's sale would reduce Resolute's portfolio to two assets - Syama in Mali and Mako in Senegal.
Resolute acquired Bibiani in 2014 but placed it on care and maintenance shortly after that to allow exploration activities and develop the mine into a large-scale operation.
The asset has mining and processing infrastructure including a US$3 million tonne per year mill and processing plant. There is also existing underground infrastructure.
Asante, a Ghana-focused pure gold exploration and development company, said Bibiani was a historically significant mine, with past production of about 4 million ounces of gold.
In July 2018, Resolute released an updated feasibility study for the operation, situated in Ghana's western region. The report outlined that Bibiani has the potential to generate about 100,000 ounces of gold per year over a ten-year mine life at a life-of-mine all-in sustaining cost of US$764 per ounce.
It also published a current JORC compliant mineral resource of 21.7 million tonnes grading 3.6 grams gold per tonne for 2.5 million ounces of contained gold.
"Asante is already building the management and operations team with a view to bring the Bibiani mine to production within the next year," said Douglas MacQuarrie, the company's president and CEO. "Further discussions are underway to fully fund the acquisition and its development using non-dilutive financing."
The Vancouver-based company has strong ties to Ghana, with Ghanaian citizens holding a significant shareholding, as well as board and executive roles.
The company has also announced plans to co-list its shares on the Ghana Stock Exchange.