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Gold mining major AngloGold Ashanti is exiting the Gramalote project, in Colombia, with joint venture (JV) partner B2Gold buying its 50% interest in the project for up to $60-million.

The agreement follows a joint sales process by B2Gold and AngloGold for their combined interests in Gramalote that failed to yield an offer from a third party that was acceptable to either company.

The project was put up for sale after an optimised feasibility study did not deliver results that met either company’s investment threshold for development.

B2Gold explained that the project was previously analysed on a larger-scale basis to provide meaningful production growth for both JV companies. However, under a single owner, smaller scale development plans would be assessed, with the goal of a higher-return project than the previously contemplated.

The miner will start a formal study for Gramalote in the fourth quarter, with the goal of completing an initial assessment by the end of the second quarter of 2024.

The acquisition will add 2.11-million gold ounces of indicated mineral resources and 0.74-million gold ounces of inferred mineral resources to B2Gold’s resource base.

“This sale will help increase our focus on our operating assets at the projects we intend to develop,” said AngloGold Ashanti CEO Alberto Calderon.

“AngloGold Ashanti remains a committed, long-term investor in Colombia with our exciting Quebradona copper and gold project and we look forward to playing a key role in developing of a modern, responsible mining sector in the country.”

AngloGold Ashanti will receive a cash payment of $20-million at the closing date of the proposed transaction, with the balance dependent on project construction and production milestones that the Gramalote project reaches.

The proposed transaction, subject to limited conditions, including approval of the South African Reserve Bank, as the agreement was executed prior to the implementation of AngloGold Ashanti’s proposed corporate restructuring related to its new corporate domicile in the UK and primary listing on the NYSE, is expected to close by the end of the year.