NYSE- and TSX-listed Golden Star Resources has entered into a binding agreement with Future Global Resources (FGR) for the sale of Golden Star’s 90% interest in the Bogoso-Prestea gold mine, in Ghana.

FGR will pay a purchase price of $55-million with a further contingent component of up to $40-million.

Golden Star advises that the payment will occur in stages to ensure that FGR focuses investment capacity on the asset itself, while providing Golden Star with exposure to long-term growth potential.

A contingent payment will be triggered if FGR decides to proceed with a Bogoso sulphide project or once it has extracted 5% of the sulphide resources at the project.

The Bogoso-Prestea operations are located in south-western Ghana, about 40 km from the Wassa gold mine. Recently, production was delivered from the Bogoso-Prestea openpits and the Prestea underground mine.

In the second half of 2018, Prestea became an underground-focused operation and the openpit operations are now drawing to a close. The Bogoso refractory openpit operation was closed in 2015; it hosts 1.76-million ounces of measured and indicated mineral resources and 70 000 oz of inferred resource and could be restarted following a refurbishment of the refractory processing plant.

Following the acquisition, FGR plans to review the entire Bogoso-Prestea project portfolio, which includes a significant refractory sulphide resource and an extensive tenement package with exploration potential.

In the meantime, operations continue at the Prestea underground operation, which entails alimak mining on 24 Level and long-hole open stope mining activities on the newly developed 17 Level.

Golden Star says the disposal will help to strengthen its balance sheet and allows the company to focus on the development of the Wassa mine and exploration activity in its surrounding area.

The companies expect the transaction to be completed by September 30.

FGR was established to build a globally diversified mining company. Its initial focus is in Africa and its principal shareholder is UK-based private investment holding company Blue International Holdings.