Resolute to “sit tight” with Bibiani as process “still raw” after failed sale to Chifeng Jilong

RESOLUTE Mining said there was “a bit of interest” in its Ghana mine Bibiani from third parties following the withdrawal of Chinese firm, Chifeng Jilong Gold Mining Company which had bid $105m for the operation.

The Chinese firm said it would not proceed with the purchase of the mine, currently in mothballs, after the Ghana government first suspended Resolute’s mining licence before reinstating it, with conditions.

One of the conditions requested an audit of the mine’s environmental, sustainability and governance (ESG) standards. Resolute also acknowledged the government’s suspension of Bibiani’s mining licence.

Stuart Gale, interim CEO of Resolute Mining, said at a first quarter update that his company would hold Bibiani before deciding how to proceed. It had the option to reopen the mine for itself, he said.

“We can sell Bibiani and we have the option to develop it. It is still relatively raw in terms of the process we’ve gone through with the government,” he said. “We will sit tight for a period of time until things have become clear.”

The company had refunded a $5m deposit paid by Chifeng Jilong.

Proceeds from the sale to Chifeng would have accelerated plans by Resolute to deleverage the firm’s balance sheet.

Resolute said in March that it expected to generate sufficient operating cash flows to support debt repayments of $50m in 2021. This included the early repayment of $25m above the minimum debt repayment obligations of $25m due in September 2021.