Private equity group Ibaera Capital GP Ltd. secured an option to earn up to a 47.5% interest in Azumah Resources Ltd.'s Wa gold project in Ghana in exchange for spending US$13.5 million.
Ibaera will also have a right to subscribe for A$2 million, or a maximum of 65 million common shares, in Azumah before Aug. 31.
The companies will look to boost the property's gold resources and reserves, which respectively total 2.1 million ounces and 624,000 ounces, within two years.
The joint venture will also conduct a revised feasibility study to support funding and developing a proposed 90,000-ounce-per-year gold operation.
Ibaera will earn the interest through its Ibaera Capital Fund LP by providing funds to the company's Ghana-registered subsidiary, Azumah Resources Ghana Ltd.
Under the agreement, Ibaera will appoint a project manager and spend an initial US$11.3 million within two years to earn an initial 42.5% interest.
If additional funds are required, Ibaera may solely fund the next US$2.3 million and earn an additional 5% interest.
The Wa project will also include the Julie West license once it gets transferred to Azumah by Castle Minerals Ltd. under an April 2016 agreement.