JOHANNESBURG (miningweekly.com) – Asante Gold will earn up to a 100% interest in the Ghana's Keyhole gold project, following an agreement with owner Sikasante Mining.

Asante has agreed to issue 250 000 shares to Sikasante in its capital stock, on final issuance of the Ayiem licence to Sikasante and receipt by Sikasante of all necessary permits required to start a drilling programme. This will give Asante a 50% stake in the project, after which the companies will complete $500 000 in work over the next four years.

Asante may earn an additional 50% interest by reserving a 2% net smelter return royalty for Sikasante, as well as a final payment of one-million shares in the capital stock of Asante on the assignment of the Sikasante licences to Asante.

The Keyhole area is surrounded by Asante’s Ashanti II gold project and is strategically located at the intersection of three major regional gold mineralised trends.

This includes the Asankrangwa gold belt, which hosts 11-million ounces of gold resources at the Asanko and Esaase gold projects, located 36 km and 60 km to the north-east respectively.

The Keyhole project also falls on a major continental scale basement structure noted on regional aeromagnetic surveys, which is spatially related to AngloGold Ashanti’s 66-million-ounce Obuasi mine, as well as the 7.6-million-ounce Newmont Akyem mine, located 57 km and 130 km to the east-north-east, respectively.

Meanwhile, over the last 40 years, a 6 km stretch of the Ankobra river in the Keyhole area has been the subject of intensive local alluvial mining and blocked for large-scale mining licences.

The alluvial gold resources have largely been exhausted and/or are unworkable, resulting in the area being opened for staking for the first time since the early 1980s.

Sikasante controls two contiguous reconnaissance licences – the northern Sraha licence and the southern Ayiem licence, which is in the final stages of being issued – covering a combined area of 2.52 km².

“To our knowledge, no modern drilling has occurred in the Keyhole area,” the company said in a statement, adding that, to further define targets for drilling, Asante was proposing 80 line kilometres of geophysical induced polarisation surveying to cover the entire Keyhole project, as well as adjacent areas targeting the main Asankrangwa shear zone, the heavily mined alluvial areas and the multiple intersections of the major regional structures.

In addition, an initial programme of 1 200 m of drilling is also planned to test the old showing workings. These programmes are subject to the completion of working capital financing by Asante.

Historical grab samples of quartz reef dump material from artisanal shafts at the workings were reported to have visible gold with grades of 49.3 g/t gold and underground sampling results over 8 m reef widths of 25 g/t gold.