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Acacia sells out of South Houndé JV

Sarama Resources (TSX.V:SWA) will buy out joint venture partner Acacia Mining at the South Houndé project in Burkina Faso.
Acacia sells out of South Houndé JV Acacia sells out of South Houndé JV Acacia sells out of South Houndé JV Acacia sells out of South Houndé JV Acacia sells out of South Houndé JV

Sarama will hand over US$2 million to get the rig keys back in Burkina Faso

Staff reporter

Acacia said the project had become "non-core" and it was time to sell.

The miner will earn US$2 million for its 50% from Sarama over 12 months, 5 million warrants valid for five years, as well as another $2 million if Sarama gets the project into production and a royalty between 1% and 2% depending on the gold price.

Acacia's struggles with its established mines in Tanzania will likely be a focus of incoming New Barrick CEO Mark Bristow, who has said he wants to form an alliance between miners in the country to fight government controls. 

South Houndé has an inferred resource of 2.1 million ounces of gold. 

"Acacia's divestment of South Houndé fits with the company's strategy of divesting certain non-core assets as part of an ongoing review of its exploration portfolio," the company said.

The Barrick-majority-owned miner still holds three JVs in the region: Central Houndé with Thor Mining, Pinarello and Konkolikan with Canyon Mining and Frontier with Melator.

The Houndé area in Burkina Faso hosts Endeavour's 235,000oz per annum gold operation.

Sarama CEO Andrew Dinning said it would get on with restarting exploration.

"I would like to acknowledge the current management of Acacia for their pragmatic approach to negotiating a mutually beneficial outcome that will facilitate development in the region," he said.

"Sarama looks forward to framing up the development opportunity and re-commencing exploration work which will focus on attractive oxide and free-milling targets in the greater project area."

Sarama was up 9% on the news, to C0.6c (US0.045c) per share.