Vast Resources gains Eureka gold mine interest after subsidiary's acquisition

AIM-listed mining company Vast Resources announced on Friday that it has acquired a 23.75% economic interest in the Eureka gold mine in Zimbabwe through an acquisition made by a subsidiary.

Subsidiary company Dallaglio Investments, which Vast Resources holds a 25.01% stake in, acquired 95% of the gold mine for approximately $4.5m, financed by a loan from the subsidiary’s 24.99% owner, Sub-Sahara Goldia Investments.

Andrew Prelea, chief executive of Vast Resources, said: 2This demonstrates our continued belief in Zimbabwe and the ability to find robust assets to add to the Vast portfolio. The Eureka mine has had historical investment in excess of $30m in the late 1990s. We believe this to be a highly attractive acquisition target given the size of the resource and level of investment in equipment made to date."

The mine, designed to produce up to 70,000oz of gold per annum from an open pit operation, is home to a significant NI43-101 compliant mineral resource 22.3Mt at an average grade of 1.90g/t Au for 1,367,600oz Au, of which 13.4Mt is an Indicated Mineral Resource at an average grade of 1.78g/t Au for 1,081,700oz Au.

"In the light of this transaction and of anticipated further transaction opportunities, we are giving consideration to the current holding structure of our Zimbabwe assets and will give updates to the market on this in due course," said Prelea.

As of 1530 BST, Vast Resources’ shares were down 2.70% at 0.61p.