Mariana Resources (MRA.V, LON:MARL) has entered into a binding term sheet to acquire an 80% stake in Awalé Resources, a private exploration company focusing on gold assets in Ivory Coast. This will allow Mariana to have a direct exposure to three exploration licenses totalling almost 1,200 square kilometers and an additional 4 licenses under application with a total size of 1,600 square kilometers.
To acquire the 80% stake in Awalé, mariana will issue US$545,000 worth of common shares and will settle US$89,000 of existing debt. That’s actually pretty cheap, and any additional payments to the Awalé shareholders will happen on a success-based schedule. Mariana has committed to pay the Awalé shareholders an additional 50 cents per ounce for the first million ounces of gold it defines in a resource estimate, and 1 dollar per ounce for every subsequent ounce, capped at a total of $3.5M (or 3.5 million ounces of gold).
Ivory Coast is one of the last underexplored countries in the West African greenstone belt, and Endeavour Mining (EDV.TO) has paved the way with its exploration and development activities in the country. The African assets are just a side-business for Mariana, as the company’s flagship asset, Hot Maden, continues to yield very impressive exploration results with some of the highest grades we have ever seen. A first PEA at Hot Maden is expected shortly, and will undoubtedly be very positive.