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Wednesday, 24th December 2008 (1395 views)

IAMGold has announced that it has entered into a definitive option agreement to earn a 50 per cent interest in Merrex Gold's Siribaya gold project in Mali, west Africa.

Under the terms of the deal, IAMGold can earn the interest by spending a total of CN$10.5 million (£5.86 million) over four years.

The company now holds 4,285,714 common shares of Merrex, representing around 6.47 per cent of the outstanding common shares of Merrex and is it were to exercise all warrants it would control 12.5 per cent.

IAMGold has completed a private placement of CN$1.5 million in Merrex by subscribing for 4,285,714 units at $0.35 per unit, each comprising a common share of Merrex and a 12-month warrant, exercisable at $0.45 per share.

Located in western Mali, the Siribaya gold project comprises 700 sq km across two major regional structural trends that "hold significant potential for economic gold mineralisation".

A mid-tier gold mining company producing almost one million ounces per year from a total of eight mines on three continents, including west Africa, the Guiana Shield of South America and Quebec, Canada, IAMGold aims to reach 1.8 million ounces of gold by 2012.

 

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