Vancouver, British Columbia--(Newsfile Corp. - February 15, 2017) - Ashanti Gold Corp. (TSXV: AGZ) ("Ashanti" or the "Company") - is pleased to announce it has signed formal option agreements (the "Option Agreements") with Red Back Mining Ghana Limited ("Red Back") an indirect, wholly owned subsidiary of Kinross Gold Corporation ("Kinross") to earn a 100% interest in three prospecting licenses located in the Ashanti Belt in central Ghana (the "Project" as further described in Figures 1 and 2).
The Option Agreements provide Ashanti with the right to earn 100% of Red Back's interest in the Project by expending US$1.0M on exploration over two years, but no less than US$500,000 in the first year. The Ghanaian government retains a 10% carried interest in all minerals projects in Ghana, therefore upon completion of the earn-in agreement Ashanti will have a 90% net interest.
The Option Agreements will be preceded by a due diligence and title curative period (the "Due Diligence Period") that may be up to 12 months from the date of a letter agreement dated October 13, 2016. At any time during this 12-month period, Ashanti will have the sole and exclusive right to initiate the Option Agreements. Ashanti will be the operator of exploration and development programs on the Project during the Due Diligence Period and during the term of the Option Agreements. Upon completion of its earn-in rights, Ashanti will have acquired 100% of Red Back's interest in the Project, subject to Red Back retaining a 2% net smelter royalty.
The Project consists of three licenses: Kwahu Oda, Asankare, New Abirem. The Project covers a total area of approximately 68 km2 in the prolific Ashanti Belt of Ghana. These licenses have been selected to build on previous work by Red Back and Newmont Mining Corporation ("Newmont"). Their location is based on the presence of shear-zone-hosted gold targets similar to those found along the northwest and southeast margins of the Ashanti Belt. Directly to the south of the Project is Newmont's Akyem mine, which was commissioned in 2013 and produced 473,000 ounces of gold in 2015, making it one of the largest annual gold producers in the world.
On the Kwahu Oda license in 2003 Red Back drilled 2,495m Reverse Circulation ("RC") holes to an average depth of 29m. Highlight historical results for these RC holes for gold mineralization include: 10m @ 8.8 g/t, 11m @ 1.5 g/t, 8m @ 3.1 g/t, 7m @ 3.9 g/t, 5m @ 2.5 g/t. (This information is based on incomplete, previously unpublished historic data provided by Red Back. This information is historic in nature and is not part of any resource estimate). Numerous other soil and auger geochemical samples on each license remain untested.
Figure 1. Location map of the Project, Newmont's Akyem mine and Ashanti's Anumso Project within the broader Ashanti greenstone belt.
Figure 2. Location map of the Kwahu Oda, Asankare, New Abirem licenses (the Project) relative to Newmont's Akyem mine and Ashanti's Anumso Project.
Tim McCutcheon, Ashanti's CEO, said: "The Ashanti Belt Project is extremely exciting and I have personally followed this area for some time. Excellent drill results in 2003 were never given a follow-up program simply due to corporate shuffling between Newmont - Red Back - Kinross - Abzu Gold back to Kinross over the course of 14 years, as well as severe gold price volatility, especially during the past five years. Finally, with these Option Agreements, Ashanti can give these licenses their due."
About Ashanti Gold
Ashanti is a gold-focused, exploration and development company with projects in the northern Ashanti Belt of Ghana and the Kinieba Belt of Mali. The Company targets projects where it has a competitive advantage due to past work experience of the team and specific project know-how.
