Gold Road Resources has completed the sale of the 50% interest in the Gruyere Gold Project to a wholly owned Australian subsidiary of Gold Fields Limited and announced the formation of a 50:50 Joint Venture in relation to the Project.
According to the company, the sale package includes the Central Bore, Attila and Alaric deposits and the YAM14 and Toto Prospects, in total comprising 144km2.
Under the terms of the agreement, Gold Road received A$250 million in cash and a Royalty Deed for an uncapped 1.5% net smelter return royalty on Gold Field’s share of production from the Gruyere JV tenements once total gold production exceeds 2 million ounces.
Additionally, Gold Fields will pay a further A$100 million to Gold Road by funding the company’s share of the initial cash calls during the construction phase and will also assume liability for up to 10% overrun on the Gruyere initial development program and budget of A$507 million.
Gold Road’s Managing Director and CEO, Mr Ian Murray, said the completion of the transaction also marks the commencement of the Gruyere Gold Project Joint Venture with Gold Fields.
“We are very pleased to begin a long term partnership with Gold Fields, an experienced company in developing and operating open-pit gold project in Australia and internationally,” Mr Murray said.
“The completion of this transaction puts Gold Road in a very strong financial position, being fully funded for its share of construction capital for the development of the Gruyere Gold Project and enables Gold Road to accelerate exploration programs across its highly prospective 50% owned Gruyere JV tenements, 100% owned North Yamarna tenements and 50% owned South Yamarna tenements.”