Kenyan Gold Mines Sold for Ksh1.4B

Seven Western Kenya gold mining licenses have been sold in a transaction totalling Ksh1.4 billion for over a 1,161-square-kilometre area encompassing Kakamega, Kisumu, Siaya and Vihiga counties.

A report published by Business Daily on Tuesday, February 11, stated that Canadian miner Barrick Gold Corporation sold its licenses to Guernsey-incorporated Shanta Gold.

The Toronto-based firm, Barrick, held licenses for the Western Kenya counties. Barrick will go home with Ksh700 million in cash and a 6.4% stake or 54.6 million shares of Shanta valued at Ksh753 million.

“The West Kenya acquisition is significant for Shanta Gold, creating an East African gold mining champion with realisable growth prospects and high asset quality across three attractive gold projects.

“Shanta has successfully operated in East Africa for nearly 20 years and this acquisition is a natural extension in terms of geographic footprint, skillset, size and mining method," Shanta CEO Eric Zurrin stated via a statement.

The transaction will be completed around July 2020 but requires approval from various government organisations such as the Ministry of Petroleum and Mining and the Competition Authority of Kenya (CAK).

The outlet further detailed that by December 2018, the Western Kenya project made a  pre-tax loss of

Ksh592 million. Shanta aims at inheriting certain liabilities as it improves its scope in the mining field.

"Shanta plans to proceed with progressing a scoping study in advance of an infill drilling campaign. Subject to the exploration results, this would likely be followed by a pre-feasibility study and a definitive feasibility study," the statement added.

Gold mining proceeds in Kenya have been yielding losses and several companies have been on the brink of selling part of their mines to raise funds for operations.

UK-based Goldplat Plc stated that it would sell its Migori gold mine over accrued loses.

Maintaining the mines has also been expensive as they require constant observation to ensure they are safe and in stable condition.

On February 6,  four gold miners died and sixteen others were injured after a gold mine wall collapsed at Osiri Matanda in Nyatike, Migori County.

“The four miners are amongst those who were trying to build the tunnel when a big stone fell on them,” Mikai Area chief David Oula stated as quoted by The Standard

In October 2019, one miner died after a mine caved in at Kopudho gold mine in Rongo Sub-County, Migori.

That same month, the Daily Nation reported that powerful tycoons benefitted from the Migori gold mines business as thousands of workers were reportedly exploited. The tycoons reportedly minted Ksh2 million monthly as workers were paid an average of Ksh 100. 

The publication stated that their investigation roped in area Governor Okoth Obado, a former Kenyan ambassador, several Chinese investors and prominent businessmen in the county.

In July 2019, four Chinese nationals were arrested in Vihiga County - Investigators claimed to have apprehended them after they were nabbed mining for gold during the night without any form of documentation.

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