Endeavour Mining Sells Karma Mine For $25 Million, 2.5% NSR, Lowers Production Guidance

Endeavour Mining (TSX: EDV) announced this morning the sale of 90% of its interest in Karma mine in Burkina Faso. The transaction is reportedly in exchange for $25.0 million and a 2.5% net smelter return royalty.

The sale is made to Néré Mining, a Burkina Faso-based mining consortium, which the firm said was a “key consideration in the sale process”. The 10% equity not held by Endeavour was owned by the state of Burkina Faso.

“The sale of our non-core Karma mine to Néré Mining is in line with our strategy of actively managing our portfolio to focus management efforts on high margin, long-life and low all-in sustaining cost, core assets,” said CEO Sébastien de Montessus.

Under the terms of the agreement, the cash payment is scheduled in that $10.0 million was paid upfront prior to closing, $5.0 million to be paid after six months, and the contingent $10.0 million to be paid after 12 months based on a sliding scale tied to the average spot gold price at the time of payment.

The firm also gets a 2.5% NSR royalty on all ounces produced in excess of 160,000 ounces.

Following the sale, the company lowered its 2022 production guidance to 1.315 – 1.4 million gold ounces from 1.4 – 1.5 million ounces.

Endeavour Mining last traded at $33.53 on the TSX.

Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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