Great Basin ties up R1bn Burnstone loose ends, begins prep work
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Canadian miner Great Basin Gold had started preparatory work at its Burnstone project, a gold prospect on the South Rand portion of South Africa's giant Witwatersrand Basin, but was still awaiting the conversion of old-order rights before it could proceed to first blast.
The R1-billion project, to be built on farms near Balfour, in Mpumalanga, had been explored intensively since its acquisition by Great Basin Gold in late 2002. Since January 2003, a total of 125 090 m of core has been drilled from 261 holes into the resource area. This process unearthed a proved initial resource of 15,1-million tons, grading at 4,61 g/t.
On Thursday, the company, domiciled in Vancouver, but run out of Sandton, announced the completion of two previously-disclosed transactions, which were important to facilitating the development of the prospect.
The first was a settlement agreement for residual amounts owing to landowners and previous mineral-rights holders that dated back to 2002, while the second related to a private placement announced in April.
CEO Ferdi Dippenaar told Mining Weekly in a telephonic interview that four-million common shares worth $2,25 a share and two-million warrants, entitling the holder to purchase an additional common share of the company at a price of $1,80, had been issued to the landowners. The warrants were exercisable for a two-year period and subject to an accelerated expiry should the market price of Great Basin's common shares exceeds $3,60 for ten consecutive trading days. The private placement of some 3,3-million common shares for C$7,5-million was also confirmed as completed.
Dippenaar said the priority was now to move ahead with the development of the property, a process that required confirmation, from the Department of Minerals and Energy, of a conversion of old-order prospecting rights to the new order. Great Basin Gold applicatied for the conversion nearly a year ago.
Once approved, the company would move ahead with mine development and would also apply for full mining rights.
The former Harmony Gold marketing director admitted that he had hoped that the process would have been completed earlier, but indicated that confirmation of its rights was now imminent. For this reason, it had already started with the construction of a portal on site, with mine contractor Scribante advancing this work.
Dippenaar also reported that a new submission for a secondary listing on the JSE should be made this week, which, if accepted by the bourse, should lead to a listing by mid-August.
Initially, Great Basin Gold had hoped to list during July, but the JSE had requested some amendments to its first listing submission.
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