B2Gold and Volta Resources announced on October 28 that they have signed a binding letter agreement pursuant to which B2Gold will acquire Volta in an all-share transaction valued at about $63 million. The acquisition will add an 81% interest in the Kiaka gold project in Burkina Faso to B2Gold’s development portfolio and a 100% interest in two additional exploration projects in Burkina Faso. The companies expect the transaction to close no later than January 31, 2014.
The Kiaka project is located on the 183.8-km2 Kiaka exploration permit in south-central Burkina Faso, approximately 120 km southeast of the capital, Ouagadougou. The advanced-stage project has the potential to sustain an average annual production rate of approximately 340,000 oz of gold over a 10-year mine life based on a pre-feasibility study released in May 2012 and contained in Volta’s current independent technical report released in January 2013.
The Kiaka project hosts a large gold deposit containing an NI 43-101-compliant measured and indicated gold resource of 4.86 million oz in 153.3 million mt grading 0.99 g/mt and an additional estimated inferred gold resource of 1.01 million oz in 33.7 million mt grading 0.93 g/mt. The bulk of the gold is contained within a single open pit in the 1.5-km-long by 200-m-wide KMZ orebody. Approximately 2.04 million oz of the measured and indicated resources are contained within continuous higher-grade lenses at a grade of 1.52 g/mt gold, surrounded 2.07 million oz in a lower-grade halo at a grade of 0.77 g/mt gold.
Additionally, significant exploration and resource expansion potential at Kiaka and Volta’s other exploration properties is expected to benefit B2Gold and Volta shareholders through their equity positions in B2Gold following completion of the transaction.
“B2Gold’s technical team will continue the de-risking process at the Kiaka gold project through the advancement of a feasibility study to establish the project’s overall economics and will consider proceeding to development of the mine once appropriate returns are evident in a higher gold price environment,” the B2Gold statement said.