B2Gold Corp. and AngloGold Ashanti Ltd. have agreed that B2Gold will sole fund the next $13.9 million of expenditures on the Gramalote Project, following which B2Gold will hold a 50% ownership interest in the joint venture. B2Gold currently holds a 48.3% interest. Under the amended terms, AngloGold and B2Gold will each hold a 50% interest and B2Gold will start an immediate transition to become manager of the Gramalote joint venture by the end of 2019, conditional upon the parties entering into an amended and restated shareholders agreement. The parties will continue to have equal representation on the joint venture management committee. Following the expenditure, each joint venture partner will fund its share of expenditures pro rata.
B2Gold and AngloGold have also agreed on a budget for the feasibility study on the Gramalote Project up to $40 million for the remainder of 2019 and through the end of 2020. This budget will fund 42,500 meters (m) of infill drilling and 7,645 m of geotechnical drilling for site infrastructure. The company currently expects to complete all drilling by the end of May 2020.
In addition, the budget will fund feasibility work including an updated mineral resource, detailed mine planning, additional environmental studies, metallurgical test work, engineering and detailed economic analysis.
The Company expects that the Gramalote joint venture will continue to advance resettlement programs, establish coexistence programs for small miners, work on health, safety and environmental projects and will continue to work with government and local communities on social programs. B2Gold, as manager, plans to continue the feasibility work into 2020 with the goal of completing a final feasibility study by December 31, 2020.
Due to the extensive testing programs that have been completed and the high level of engineering performed in 2017 for an internal prefeasibility study, the engineering work remaining to get to final feasibility is not extensive. The main work program for feasibility is infill drilling to confirm and upgrade the Inferred Mineral Resources to Indicated status.
The Gramalote Project is located 230 kilometers (km) northwest of Bogota and 80 km northeast of Medellin in central Colombia. Based on the recent remodeling of the Gramalote geologic resource, the Company believes that the Gramalote Project has the potential, subject to completion of infill drilling scheduled to commence in November and a final feasibility study expected by the end of 2020, to become a large low-cost open pit gold mine.