Edv receives US$25.3 million from the sale of its Youga Mine
George Town, February 29th, 2016 - Endeavour Mining (TSX:EDV) (OTCQX:EDVMF) is pleased to announce that it has received US$25.3 million upon simultaneously signing and closing the sale transaction of its non-core Youga Mine to MNG Gold ("MNG").
The total cash consideration is comprised of US$20 million for the asset and US$5.3 million for the cash-on-hand. In addition, Endeavour has retained a 1.8% Net Smelter Royalty ("NSR") on production realized beyond the current reserve from the property sold, and with the inclusion of a buyback provision.
Neil Woodyer, CEO of Endeavour, stated: "This transaction provides upfront value for Youga's remaining 2 year mine life and gives us greater financial flexibility to pursue growth opportunities. It is in line with our strategic objective of actively managing our portfolio to improve its overall quality.
Since MNG's nearby Balogo high-grade deposit will give a second life to the Youga operation, we firmly believe that this transaction is in the best interest of all stakeholders, including our employees, the government, and the local population."
About the Youga Mine
The Youga Gold Mine is located approximately 180 km southeast of Ouagadougou. Endeavour holds a 90% interest in Burkina Mining Company ("BMC") which has been granted the rights to exploit the Youga Gold Deposit. The remaining 10% of BMC is held by the Government of Burkina Faso.
Youga is an open pit mining operation with a 1mtpa gravity/CIL processing facility. It has recovered a total of over 0.6 million ounces of gold since operations commenced in 2008. Youga employs approximately 665 workers in total, including full time Endeavour employees and contractors.
As at December 31, 2015, Measured and Indicated mineral resources (inclusive of reserves) were 17.8 million tonnes at 1.4 g/t gold containing 0.8 million ounces and the Proven and Probable mineral reserves were 2.5 million tonnes at 1.6 g/t gold containing 0.1 million ounces[1].
In 2015, Youga produced 68,407 ounces of gold. Production in 2016 is forecast to be 40,000 to 45,000 ounces at a mine-level AISC cost of $980 to $1,030 per ounce.
About MNG Gold
MNG Gold is a privately owned Turkish gold exploration and development company focused on West Africa and Turkey. MNG Gold own the high grade gold Balogo project, located in proximity to the Youga mill, in Burkina Faso and the Kokoya gold project in Liberia. MNG Gold has a broad capacity to explore, develop and produce gold in Turkey and abroad. The Company is owned and financed by Mr Mehmet Nazif Gnal, a Turkish entrepreneur.
I like the sale and the NSR, but i think the price is low? Correct?
Expect Hounde decision this week now!