LONDON: Contango Holdings Plc announced the acquisition of the Ntiela Gold Project in Mali, which is contiguous to the company’s existing Garalo Gold Project.
Carl Esprey, Chief Executive Officer of Contango Holdings, said: “Our Garalo Gold Project is on track to deliver first gold by the end of this year and I am pleased to report that it continues to yield some incredibly encouraging results for us. Our decision to increase our mineralised footprint in this area marks an important step for Contango as we look to establish ourselves as an emerging development and production company in the area, with a pipeline of expansion opportunities.
“We look forward to providing an NI 43-101 update on Garalo this month, which we expect will build on the immensely encouraging Independent Technical Report released in December 2020, which outlined the potential for a 1.8Moz gold resource. Clearly the exploration of Ntiela and the delineation of additional resource ounces to our global gold resource inventory would further enhance our overall plans to establish a very significant new gold mine with multiple open pit operations.
“Based on our proprietary knowledge from Garalo, we believe the true value of Ntiela is yet to be unlocked and accordingly we have acquired the asset at a highly compelling valuation. With this in mind, we look forward to providing updates on Garalo and Ntiela, in addition to our development activities at our first open pit at the Lubu Coal Project, over the coming weeks.”
The Ntiela Gold Project covers an area of 100km2 in the Sikasso region of southern Mali, 200km south-east of the capital Bamako and close to the Guinea border.
The permit, which is contiguous to the Garalo Gold Project, is surrounded by a number of multi-million ounce gold deposits and the region is home to some of the world’s leading gold miners, including IAMGOLD, Barrick, B2 Gold, Endeavour Mining and Hummingbird Resources, which has helped to establish Mali as the third largest gold producer in Africa.
The prospectivity of Ntiela has been established from work programmes conducted by the previous operator which included soil and termite mound sampling and geochemistry, regolith mapping and extensive trenching. This work has been supplemented by drone surveys conducted by Contango geologists, which have further supported the potential for the extension of at least two target zones from Garalo to Ntiela.
The Board intends to launch an exploration programme at Ntiela following the publication of the maiden NI 43-101 report on Garalo later this month. Further details regarding the exploration campaign will be announced in due course.
Contango will acquire Ntiela for total consideration of approximately £750,000. This includes a cash consideration of €400,000 and the issue of 4,000,000 new Ordinary Shares in Contango at a price of 10 pence per share. The cash component will be paid in two instalments during 2021, whilst the shares will be issued during H2 2021 and will be subject to a 12-month lock up.