Pan African expands into Australia, halts Sudan project

South Africa’s Pan African Resources (LSE: PAF; JSE: PAN) is expanding into Australia with the acquisition of gold junior Tennant Consolidated Mining Group (TCMG) for US$54.2 million, as it suspends exploration activities in civil-war hit Sudan.

The move secures full ownership of TCMG’s near-production Nobles gold project in Australia’s Northern Territory to Pan African. It previously held an 8% stake in Tennant. 

The asset, scoped to produce 50,000 oz. of the precious metal a year, is scheduled to begin commissioning in June 2025.

The acquisition is part of Pan African’s strategy to secure low-cost production assets in Tier 1 mining jurisdictions, with payback on the initial A$35.7 million investment expected within three years, assuming an average gold price of about US$2,600 per ounce.

“TCMG represents an opportunity to further expand and diversify our near-term low-cost production base,” said Pan African’s chief executive, Cobus Loots. 

Loots said the company had been evaluating TCMG’s portfolio for nearly a year before concluding that the friendly takeover aligned with its goal of safe, efficient gold mining ventures.

Work on mine construction has already started with the processing plant 50% complete, Pan African said, adding that first gold production was scheduled for July 2025.

Force Majeure

Pan African also announced on Tuesday it had declared force majeure on its exploration efforts in Sudan’s Red Sea state as ongoing civil conflict between political factions has disrupted operations. 

The suspension affects exploration rights the company holds in the area, as conflict continues to create instability and security risks for both personnel and assets.

“Given the ongoing political unrest in Sudan, the decision has been taken to suspend exploration activities in Sudan” Pan African stated, adding that issuing a formal notice of force majeure would safeguard its concession rights amid the crisis.

As the country’s official military continues to fight the renegade paramilitary group Rapid Support Forces, Pan African’s pivot to Australia may signal a shift toward lower-risk regions.