The Australian miner is pursuing legal advice on the validity of the notice, while seeking clarification from the government for the lease termination
Resolute Mining’s mining lease for the Bibiani Gold Mine has been cancelled by the Ghanaian government. (Credit: aymane jdidi from Pixabay)
Resolute Mining announced that the mining lease for its Bibiani Gold Mine in Ghana has been scrapped by the Ghanaian government.
The company had received a letter from the Ghanaian Minerals Commission that the Ghanaian Minister of Lands and Natural Resources had instructed to terminate the mining lease.
Furthermore, Resolute Mining said that it has been advised to stop all activities and operations at the Bibiani Gold Mine.
Calling the action “unexpected”, the Australian miner said that it will pursue clarification from the Minister’s office for the reason behind the scrapping of the lease.
The company stated: “As a result of this notice Resolute is currently seeking legal advice on the validity of the notice, its rights of appeal and potential recourse while considering the impact of the notice on the sale agreement with Chifeng Jilong Gold Mining Co. Ltd for the sale of the Bibiani Gold Mine.”
The Australian miner owns 100% of the mine through its fully-owned subsidiary Resolute (Bibiani). The Ghanaian government holds the right to a 10% free carried interest in the gold mine.
Resolute Mining had acquired the Bibiani Gold Mine in 2014. Since then, the company had undertaken two surface and underground resource drilling campaigns for re-assessing the potential of underground operations at the mine.
As per an update in June 2018 to its earlier feasibility study, the company estimates the Bibiani mine to potentially produce nearly 100,000oz per year at a life-of-mine all-in sustaining cost of $764/oz through a 10-year mine life.
In late 2020, Resolute Mining signed a deal to divest the Bibiani Gold Mine to Chijin International (HK), a fully-owned subsidiary of Chifeng for $105m. Subject to various approvals and conditions, the sale was expected to be closed in the first quarter of this year.
The Australian miner’s interim CEO Stuart Gale at that time said that the deal is in line with the company’s strategic focus on its core operating assets and also on improving its balance sheet.