February 10, 2020 / 9:11 AM / 18 days ago

Shanta Gold buys Kenya exploration project from Barrick

JOHANNESBURG, Feb 10 (Reuters) - Shanta Gold on Monday said it had acquired Barrick subsidiary Acacia Exploration’s project in southwestern Kenya in a $14.5 million deal which gives the Tanzania-focused miner its first asset outside the country.

The project, which Acacia Mining began exploring in 2010 before being bought out by Barrick, is estimated to hold 1.18 million ounces of gold with a grade of 12.6 grams per tonne.

Shanta bought the project for $7 million in cash and $7.5 million in shares issued to Barrick, making the Canadian miner Shanta’s fifth largest shareholder with a 6.4% stake.

The acquisition comes after Shanta Gold delevered its balance sheet by 69% since 2017, according to CEO Eric Zurrin.

“What that allows us to do now is look outside our existing boundaries, both in terms of our existing assets and the country,” Zurrin said.

Shares in Shanta Gold hit their highest level in three years in early trading, and were up 3.2% by 0900 GMT. (Reporting by Helen Reid, Editing by Kirsten Donovan)

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