AMN - BURKINA FASO: Sarama regains 100% of South Houndé

Sarama Resources has executed a definitive agreement with Acacia Mining that provides for termination of a 2014 earn-in agreement between the two companies in covering the South Houndé Gold Project in southwest Burkina Faso. This results in Sarama resuming operatorship and regaining a 100% interest.

South Houndé, which is contiguous to Sarama’s neighbouring 100%-owned ThreeBee Project, hosts an inferred mineral resource of 2.1 million ounces, including an oxide and transition component of 600,000 ounces.

The ThreeBee project hosts the Bondi deposit which has a historical mineral resource of 300,000 ounces in the measured and indicated category and 100,000 ounces in the inferred category.

Together, these projects form the foundation for possible development in the region, which is underpinned by the current inventory of free-milling material, suitable for processing by heap leaching or a conventional gold plant.

Sarama will benefit from about US$13 million of historical exploration expenditure by Acacia on the South Houndé project and significant exploration potential remains on both the South Houndé and ThreeBee Projects with the initial focus for Sarama being attractive oxide targets.

Sarama’s president and CEO Andrew Dinning said: “We are very pleased to have executed the agreement to finalise Acacia’s exit from the South Houndé project and look forward to resuming full ownership and management.

"Acacia’s exit is fundamental to consolidating our regional position and allows us to finally start advancing our key assets up the value curve and towards mine development.

"Sarama looks forward to re-commencing management of the project and will initially focus on resource development work which includes drilling attractive near-field and extensional oxide and free-milling targets, whilst framing-up potential development options for the project.”

Upon resuming operatorship, the company will focus exploration efforts on attractive oxide and free-milling targets on the project along with Sarama’s adjacent ThreeBee project. Potential exists to expand the current oxide and free-milling inventories on each of the project areas.

Sarama’s recent exploration at the Zanawa and SE Splay prospects at ThreeBee have indicated further potential to add to the mineral inventory where recent reconnaissance drilling has extended the strike of new mineralisation to 1km and delivered encouraging intersections.

The company is actively pursuing these targets and has identified a number of areas at the MM, MC, Obi and Kenobi Deposits on the South Houndé project for immediate follow-up.

Concurrent with exploration activities, the company will begin scoping work to frame project development options, which will generally focus on the component of the mineral inventory which is amenable to processing by heap leaching or a conventional gold plant.

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