Anglo invests in Trans-Siberian

AngloGold Ashanti (ASL-N) will acquire a 29.9% interest in Trans-Siberian Gold (TSG-L).

Two successive lots of 6.1 million shares will be sold to Anglogold for 1.3695 and 1.494 per share, respectively, for a total investment of 17.6 million.

Shareholders will meet to vote on the deal on July 27. After the first subscription, two AngloGold nominees will be appointed to the Trans-Siberian board. The companies have negotiated a consultancy agreement, as well as an option agreement that allows AngloGold to earn up to a 51% interest in any of Trans-Siberian’s new exploration or mining projects. The second share subscription is subject to the Standard Bank of London’s arrangement of financing for the Asacha mine, in central Siberia. Up to $30 million in loan financing is required; due diligence and credit approvals are under way.

The Asacha deposit was the focus of a bankable feasibility study completed in March. The measured and indicated resource is estimated to be 723,000 tonnes grading 22.68 grams gold and 32.82 grams silver per tonne, equivalent to 527,000 oz. gold and 1 million oz. silver, whereas the inferred resource is 238,000 tonnes grading 17.25 grams gold and 47.37 grams silver. The cutoff was 6 grams gold-equivalent per tonne and the gold-equivalent ratio was 1:75 gold to silver.

Plans call for the Rodnikova deposit, 60 km north of Asacha, to be mined as a satellite orebody. Rodnikova contains an indicated resource of 443,000 tonnes grading 8.6 grams gold and 89.2 grams silver, or 122,000 oz. gold and 1.27 million oz. silver. There is also an inferred resource of 331,000 tonnes grading 7.9 grams gold and 78.8 grams silver. The estimates are based on a cutoff of 4.5 grams gold-equivalent per tonne.

Asacha comprises narrow, steeply dipping vein systems with minor sulphides, and 95% of the ore is amenable to direct cyanidation. The Rodnikova deposit has similar geology.

Trans-Siberian Gold has a 90.05% interest in Trevoznhoe-Zarevo, which holds the mining and exploration licences that cover both the Asacha and Rodnikova deposits. Trans-Siberian will pay US$1 million for the remaining 9.95% interest once a positive development decision has been made for Asacha.