Kazakh gold miner Solidcore Resources will invest $25 mln in geological exploration at five sites in Japan as part of a strategic alliance with Canada's Japan Gold Corp. In the future, Solidcore may acquire up to 80% in individual projects. This was reported by Qazaqyia.kz citing Kursiv Media.
Exploration programme
According to a company statement dated 23 September, Solidcore will finance a three-year exploration programme at Japan Gold's sites on the islands of Hokkaido and Kyushu. After the first stage is completed, the company will be able to acquire 49% in one or several sites, depending on the exploration results.
At the second stage, Solidcore will be able to increase its stake to 70% if it finances the preparation of a preliminary feasibility study for the project. The stake can be raised to 80% after financing a bankable feasibility study. Decisions will be made separately for each site.
Investment in Japan Gold
At the same time, Solidcore invested a further $6.85 mln in Japan Gold itself. The company acquired 78.8 mln securities of the Canadian gold miner and received 18.81% of its ordinary shares. If the acquired warrants are exercised, Solidcore's stake may increase to 19.9%.
Solidcore also received the right to appoint two members of Japan Gold's board of directors as long as it owns at least 18% of the company. Solidcore adviser Viktor Flores and Executive Vice President for Compliance and Corporate Governance Tatyana Chedaeva have already joined the board.
Alliance sites
The alliance includes five sites — Hakuryu, Bajo, Mizobe, Ryuo and Aibetsu. They are located in areas of historical gold mining. In particular, the geological structure of Mizobe is similar to the Hishikari deposit, whose resources Japan Gold estimates at 13 mln ounces of gold.
Japan Gold is a Canadian exploration company operating in Japan. Its portfolio of exploration rights exceeds 3,000 sq km. Solidcore is registered in the Astana International Financial Centre and trades on the AIX. The company operates two active gold mining enterprises and the Ertis POX project in Kazakhstan.
Return of funds to shareholders
Earlier, Solidcore announced its intention to return up to $1.2 bln to shareholders through a buyback of its own shares. The company plans to acquire up to 102.9 mln securities, or about 23.2% of its share capital, at $11.66 per share. Applications are accepted until 12 October, and the buyback itself must receive shareholder approval at a general meeting on 30 September. As of 1 September, Solidcore's cash stood at $1.4 bln, with a net cash position of $747 mln.
Syrymbet project
In addition, in August Solidcore's subsidiary Tin One Mining signed a memorandum on the implementation of a project to build a mining and processing plant at the Syrymbet tin deposit in the North Kazakhstan region. The preliminary investment volume is estimated at no less than 150 bln tenge. Implementation of the project depends on approval by Solidcore's board of directors. The enterprise is expected to create about 800 jobs.