Sarama sells WA assets to Riedel, confirms date for Burkina Faso arbitration hearing
Vancouver-headquartered Sarama Resources has entered into a binding share sale agreement with ASX-listed Riedel Resources to sell its Cosmo and Mt Venn gold projects, in Western Australia, in exchange for a combination of equity consideration and the payment of certain project-related expenses.
After selling these assets to Riedel for A$4.6-million in cash and shares, Sarama will hold about 32% ownership of Riedel, which will rise to 44% on performance milestones.
The transaction will provide Sarama with a significant equity interest in Riedel, which will be transformed into a well-funded, multi-proejct gold explorer with several large projects across Tier 1 jurisdictions in Western Australia and Arizona, in the US.
The companies have proposed that Sarama chairperson Andrew Dinning be appointed a nonexecutive director of Riedel and that Sarama corporate development VP Paul Schmiede be appointed CEO of Riedel on completion of the transaction.
Riedel will effectively acquire the Cosmo and Mt Venn projects by buying 100% interest in Sarama’s subsidiary Yikkari Resources. The transaction is expected to close in June, subject to Riedel’s shareholder approval.
Meanwhile, Sarama has received documentation from relevant authorities in New South Wales granting the company three early-stage copper and gold exploration tenements in New South Wales, which Sarama believes can add significant value to the portfolio for minimal expenditure.
The licences are adjacent to the Lachlan Fold Belt and are prospective for copper, gold and polymetallic mineralisation.
The company has already identified three priority areas: Bong Bong Creek, Bald Hill and Gegedzerick Copper Lode, which comprise clusters of historical copper workings and mineral occurrences.
Planned exploration across these targets will comprise systematic, staged reconnaissance programmes aimed at validating prospectivity for porphyry and intrusion-related copper/gold mineralisation and advancing targets towards drilling.
DISPUTE PROCEEDINGS
Sarama confirms that a procedural timetable and merit hearing date have been agreed and scheduled, in respect of the Burkina Faso government’s unlawful expropriation of Sarama’s Tankoro 2 exploration permit.
Sarama explains the permit was the central component of a multimillion-ounce gold development project and the company is seeking damages of $242-million plus interest through arbitration in the International Centre for Settlement of Investment Disputes – which is a division of World Bank Group.
The arbitration will now proceed through document production, further written submissions by both parties and pre-hearing procedural steps. This will culminate in a merits hearing on February 22 to February 26, 2027, during which the parties will present their case and supporting evidence to the Tribunal and provide opportunity for witnesses to be cross-examined.
Sarama confirms it has secured a $4.4-million four-year non-recourse funding facility to cover all legal fees and expenses related to the arbitration. The facility is secured solely against the claim and is repayable only in the event of a successful outcome or settlement.
