Andrew Wray

Andrew Wray and team finally lost patience trying to turn the sow’s ear that was Prestea mine in Ghana into a golden purse. Having written down the operation for $56.8m, the only remaining act was to close or sell. In October, the company announced the $30m sale of Prestea-Bogosu (renamed in recognition of its sulphide potential) to privately-backed Future Global Resources. The transaction is handy for Golden Star: it removes $25m in negative working capital and $53m in environmental liabilities from its balance sheet. Gold price depending, Golden Star may also receive a royalty stream, assuming the Bogosu Sulfide Project is developed.

Now with production scaled back to no more than 192,000 ounces, Golden Star is a somewhat smaller proposition but potentially profitable company with a restructured balance sheet capable of funding the Southern Extension project at Wassa, its remaining asset, also in Ghana. A prefeasibility into the Wassa expansion kicked off in the third quarter and there’s always potential for Golden Star to participate some way in the consolidation that is enveloping the sector.

As mentioned in previous editions, Golden Star is controlled by La Mancha Investments which is led by deal-hungry telecoms-turned-gold-bull, Naguib Sawiris. Wray’s most instructive comment on the firm’s situation is that the sale of Prestea makes it “a more attractive counter-party”. Make of that what you will. There’s no denying, however, that Golden Star has spent much of the buoyant gold market as a back-peddling minnow.