Tuesday, 18th September 2007 (2055 views)

Junior gold company PMI Gold is to buy the Ghanaian Kubi project from Nevsun Resources subsidiary Nevsun Africa, it has emerged.

Through the deal, all the shares of Nevsun Resources would be acquired by PMI Gold for nine-million shares in the firm and another £3 million in cash.

Chief executive officer of PMI Gold Douglas MacQuarrie commented that metallurgical tests at the project indicated that gold mineralisation was nonrefractory, free milling and had high recoveries with the use of conventional circuits.

"PMI Gold believes that a near-term production decision will be possible," he said.

He added that further capital would be amassed through a combination of equity and project financing, pending the results of a further pre-feasibility study.

The Kubi resource was first located 20 km south of AngloGold Ashanti's Obusai mine in the early 20th century and was developed by local artisan miners.

PMI Gold controls some 663 square-kilometres of gold exploration concessions in Ghana's Golden Triangle area.

 

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