http://www.miningweekly.com/article/sunridge-gold-formalises-eritrean-operating-entity-2014-10-09
Sunridge Gold formalises Eritrean operating entity
By: Henry Lazenby
9th October 2014
TORONTO (miningweekly.com) – TSX-V-listed Sunridge Gold on Thursday
announced that it had recently formalised a shareholder agreement with
State miner Eritrean National Mining Corp (ENAMCO) and created the Asmara
Mining Share Company (AMSC), the operating entity that would own and
operate the Asmara copper/zinc/gold mining project, in Eritrea.
Sunridge said that it had transferred to the AMSC the Asmara project,
equipment and all Eritrean employees.
"We are very happy to have completed the formation of AMSC and formalised
our partnership with ENAMCO on the Asmara project. This means that we can
now rapidly push the project towards the start of Phase 1 production next
year.
“Also, the money that we have recently received from ENAMCO puts Sunridge
in a strong cash situation particularly because of our current low
expenditure rate on the project,” Sunridge president and CEO Michael Hopley
said.
The AMSC is owned 60% by Sunridge and 40% by ENAMCO, which had a 30%
participating and 10% free carried interest, and is governed by a
shareholders' agreement.
The AMSC has a board of directors of five, comprising three from Sunridge
and two from ENAMCO. Hopley, had been appointed chairperson of the AMSC.
All future project development or exploration costs would be shared between
Sunridge (two-thirds) and ENAMCO (one-third), as well as all project costs
back-dated to July 2012, when the Eritrean company notified Sunridge of its
intent to exercise its full option.
ENAMCO agreed pay Sunridge $18.33-million in instalments before production
started in return for its rights to the property, with $2-million paid in
July and another $1-million plus interest had just been received, with a
further $2-million scheduled to be received before the end of November.
The balance of $13.33-million would be paid in instalments after a finance
agreement was closed that secured a significant portion of the funds
required to develop the project.
Having established the AMSC, Sunridge and ENAMCO was now working jointly to
acquire the mining licence for the Asmara project, expected early next year.
Edited by: Creamer Media Reporter
Received on Thu Oct 09 2014 - 22:27:10 EDT