An agreement with London-based Reunion Mining sets the stage for Ashanti Goldfields (AHD.U-T) to earn up to a 65% interest in the Kraapian gold project in Botswana.
To earn the interest, Ashanti must fund all exploration and complete a positive feasibility study. Reunion currently owns 80% of Kraapian, while Vancouver-based First Quantum Minerals (FM-V) holds a 20% interest.
The gold project covers 821 sq. km in southern Botswana, near the border with South Africa. The licence includes the northern extension of South Africa’s Kraapian Schist Belt, an Archean greenstone belt that holds a producing gold mine with contained reserves estimated at more than 2 million oz.
Little exploration has been carried out on the property, which is covered by extensive Kalahari sands. Early last year, Renuion and First Quantum spent US$250,000 and identified several areas with coincident geochemical and airborne magnetic anomalies.
These targets will be further explored by Ashanti, which has agreed to spend US$250,000 this year and US$500,000 in 1999. The African major also agreed to fund its partners’ shares of development costs, subject to repayment from profits.
Reunion will continue to manage the project until Ashanti has earned a 50% interest. Work is now under way to follow up the existing gold anomalies and identify new ones in areas already covered by soil geochemistry.
Meanwhile, Reunion continues to advance its Skorpion zinc project, 45 km north of the South African border in southwestern Namibia.
A prefeasibility study, completed last year, indicates that the project has the potential to produce at least 100,000 tonnes of zinc metal per year, at a capital cost of US$1.6 million.
Detailed drilling to upgrade reserves has been completed, and an enhanced reserve estimate will be released shortly.
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