Golden Rim in Balogo sale

West Perth-based Golden Rim Resources will sell its Balogo gold project to Turkish company MNG Group for up to $12.8 million, with the full payment dependent on the mine going into commercial production.

MNG Group is backed by billionaire Mehmet Nazif Gunal.

Balogo, which is located in southern Burkina Faso, is a small, high-grade deposit, with inferred resources of around 185,000 ounces.

Golden Rim said it had been unable to fund a feasibility study for the project in southern Burkina Faso due to soft economic conditions.

It will be paid $0.6 million initially and a further $5.8 million on cpmpletion of the transfer of the exploration permits.

Two further payments may be made subject to meeting defined milestones.

Managing director Craig Mackay said the deal represented good value for the company.

“It means that on completion of the sale, the company will have sufficient cash in the bank for ongoing exploration at our exciting Korongou project in Burkina Faso and to consider new opportunities for the company,” he said.

In September, Golden Rim raised $2.6 million for exploration at the Korongou project, where it hopes to undertake extensive drilling.

The company said it anticipates Korongou will hold a much larger gold deposit than Balogo.

Golden Rim closed at 1 cent per share.