Golden Star shines over Mampon (June 26, 2003)

Denver-based Golden Star Resources (GSC-T) has completed its $9.5-million acquisition of Ashanti Goldfields‘ (ASL-N) Mampon gold property, about 40 km northeast of Bogoso, Ghana.

Mampon is home to a probable reserve of 1.5 million tonnes grading 5 grams gold per tonne. A production permit from the government of Ghana has been delayed by restrictions on mining in areas reserved for forest production.

Golden Star expects to wrap up a related US$3.4-million deal with Birim Goldfields (BGI-T) during the third quarter. That deal involves Birim’s 90% stake in the surrounding Dunkwa land package, and Birim’s right to a royalty indexed to the size of the Mampon deposit. The first 200,000 oz. of production from Mampon are exempt from the royalty.

The Dunkwa deal requires the approval of the government, which owns a 10% interest in the properties.

When the dust settles, Golden Star will control around 84 km of strike length on the Ashanti trend, centred on its Bogoso-Prestea mine. The Prestea open-pit mine, Golden Star’s sole producer, is expected to produce 140,000 oz. of gold at a cash cost of US$185 apiece in 2003.

Meanwhile, the company expects to wrap up a feasibility study on the Wassa gold deposit, 150 km west of Accra, by mid-year. Pending a positive result, plans call for construction of a 120,000-oz.-per-year gold mine.