18 July 2013

Namibia: Three Bids for Navachab

CANADIAN firm, B2Gold Corporation, Vedanta Zinc International Group and another Canadian firm Giyani Gold Corporation are bidding to buy the Navachab Gold Mine near Karibib, which is being sold by AngloGold Ashanti.

The Namibian has established, from sources familiar with the bidding process, that the three mining firms are bidding to buy the mine, which has been operating since 1989. The sources spoke on condition of anonymity because they are currently working close to the bidding process. The state mining company, Epangelo, which had previously shown interest pulled put of the bidding process but is expected to negotiate a stake with the firm that wins the bid, the sources said.

B2 Gold is currently developing the Otjikoto Gold Project, which is expected to start production in 2015. Vedanta owns the Skorpion Zinc Mine which was bought from Anglo American. Giyani Gold recently listed on the Alternative Investment Board (AIX) of the Namibian Stock Exchange (NSX).

The three companies are said to have asked Epangelo to join their bids, but Epangelo is said to have declined preferring to work with the bid winner. AngloGold Ashanti has not disclosed the amount it wants for Navachab. In February, AngloGold said it was reviewing costs and expansion projects and was planning to offload peripheral assets, including Navachab.

But a source said the sale of Navachab by AngloGold did not come as a surprise because Anglo American has a history of selling mines when they are nearing the end of their lifespan as it did with Skorpion.

"Anglo American does not want to have involved in things like laying off workers and rehabilitation of mines. But there are other companies, which have the expertise to take over mines at the end of their lifespan," the source said.

Navachab, which is the open-pit mine has a processing plant that handles 120 000 metric tons a month. The mine produced 74 000 ounces of gold last year.

AngloGold spokesman, Alan Fine in South Africa could not be reached for a comment.

Efforts to get a comment from Navachab Managing Director Johan Coetzee failed.

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