Within the next couple of weeks, Barrick Gold Corp (TSE: ABX) (NYSE: GOLD) and Centamin PLC (TSE: CEE) will have a detailed contract finalized for conducting gold exploration in a 3,000-square-kilometre section of Egypt’s Eastern Desert.
The Middle East-focused publication Zawya reported Monday that Egypt’s Oil and Mineral Resources Ministry was currently in the process of drafting the deal’s financial, legal and commercial particulars. Zawya cited Jordan’s Arabic language newspaper Ad-Dustour for the information.
Barrick, Centamin and others were awarded gold exploration contracts in Egypt through an exploration competition organized by the ministry in 2020 and 2021. But, a final agreement for production sharing and other key details has not been signed just yet — Ad-Dustour said.
“We will witness in the next few weeks the signing of a final agreement with those two companies,” Oil and Mineral Resources Minister Karim Badawi explained.
Although this final agreement is pending, Barrick has already invested about US$8.8 million to pursue exploration in 19 claim blocks within the 3,000 square kilometres. The company hasn’t specified how much progress it has made.
Meanwhile, Centamin currently holds Egypt’s largest gold-producing asset. The Sukari Gold Mine has produced over 5.9 million ounces of gold and still has another decade of production remaining. Centamin was the primary sponsor of this year’s Egyptian Mining Forum, held in July.
Egypt’s Eastern Desert is historically known for being a prolific mining region. It has been producing gold, copper, amethysts and other minerals for thousands of years.
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AngloGold Ashanti to acquire Centamin and Sukari
The multi-national gold major will be taking over Centamin through a cash and stock deal valued at US$2.5 billion. This agreement was announced earlier this month and is expected to close in Q4 this year.
Centamin shares shot up by over 20 per cent when this was revealed on Sept. 10 to heights not observed for four years.
The addition of the Sukari Mine will boost AngloGold Ashanti PLC’s (NYSE: AU) gold production yield by about 450,000 ounces per annum. Not only is it Egypt’s top gold asset, it is one of the world’s largest.
“This will open the way for a lot of interesting strategic possibilities,” AngloGold chief executive Alberto Calderon said.
rowan@mugglehead.com
