- Firefinch (FFX), previously known as Mali Lithium, has bought an 80 per cent stake in the Morila Gold Mine in Mali
- The company will pay US$27.67 million (around A$38.4 million) for Morila, but that sum includes tax credits worth an estimated US$16.79 million (roughly A$23.04 million)
- Firefinch recently raised $74 million through a placement to fund the transaction
- FFX will immediately start work to get production moving again, including drilling, resource upgrades and tailings treatment for early cashflow
- Firefinch is trading 1.54 per cent lower for 16 cents
Firefinch (FFX), previously known as Mali Lithium, has bought an 80 per cent stake in the Morila Gold Mine in Mali.
The deal
Firefinch bought Morila, which had an 80 per cent stake in the mine, with the other 20 per cent owned by the Mali government.
Morila was in turn owned by Barrick Gold and AngloGold Ashanti (AGG).
Firefinch will pay US$27.67 million (approximately A$38.4 million) for Morila, but that sum includes tax credits on Morila’s books, worth an estimated US$16.79 million (roughly A$23.04 million).
A further adjustment of US$1.2 million (about A$1.65 million) was also applied to account for gold produced at the mine but refined elsewhere, with payments still owing to Morila.
Those funds, when paid, will be used for development work by the new owners.
Firefinch Executive Chairman Dr Alistair Cowden says the company is looking forward to getting Morila back up and running.
“We have much to do and we are well underway in the process to transition Morila from treating tailings and preparing for closure to an operation preparing for the resumption of open pit mining and expansion of production,” Dr Cowden said.
“We are excited about the journey ahead and look forward to keeping our shareholders updated and we will be unrelenting in our efforts to develop a long life, mid-scale gold producing operation,” he added.
Next steps
Firefinch recently raised $74 million through a placement to fund the transaction.
The company will immediately start work to get production moving again, including drilling, resource and reserve upgrades, and new mine planning.
Firefinch will also continue work on the re-treatment of tailings to provide early cashflow.
The company is then planning to ramp up production at satellite pits through next year ahead of reinstating production at the Morila main pit by early 2022 at the latest.
Firefinch is trading 1.54 per cent lower for 16 cents at 12:27 pm AEDT.