B2Gold is set to take full ownership of the Gramalote gold project in Colombia by acquiring AngloGold Ashanti’s 50% stake in a deal worth up to $60m.

The purchase agreement comes after AngloGold Ashanti and B2Gold jointly attempted to sell their combined interests in Gramalote but did not receive any acceptable third-party offers. B2Gold manages the gold project situated 124km northeast of Medellín, in the Department of Antioquia.

After finalising the optimisation work for the feasibility study in the latter part of 2022, both partners concluded that the Gramalote gold project falls short of their investment criteria for development.

Following a thorough examination of project alternatives, the parties initiated the sales process for the project, which has an attributable mineral resource of 2.6 million ounces (Moz). This includes a mineral reserve of 1.6Moz.

AngloGold Ashanti CEO Alberto Calderon said: “This sale will help increase our focus on our operating assets the projects we intend to develop.

“AngloGold Ashanti remains a committed, long-term investor in Colombia with our exciting Quebradona copper and gold project and we look forward to playing a key role in developing of a modern, responsible mining sector in the country.”

The consideration includes $20m upon closing of the deal, $10m upon B2Gold taking a construction decision on the project, and $10m upon commercial production if achieved within five years of closing.

Additionally, there are payments of $10m each on the first and second anniversaries of achieving commercial production.

B2Gold stated that the agreement unifies ownership of the Gramalote gold project, offering more flexibility to explore development options with reduced capital requirements and potentially higher returns.

The company stated: “Upon completon of the Transaction, the structure of the Transaction immediately adds to B2Gold’s consolidated Mineral Resource base and significantly increases the Company’s exposure to the upside from the potential development of the Gramalote Project, while still providing ongoing exposure to AngloGold through the contingent payments, which make up the majority of the purchase price.”

Subject to approval from the South African Reserve Bank and the meeting of customary conditions, the deal is anticipated to close by the end of 2023.