Resolute Mining (LON:RSG) have confirmed that they have sold their Ravenswood gold mine in Queensland.

The sale was confirmed after rumors hit the market on Monday, however today shareholders have been fully notified with confirmation.

On Monday, it was announced that Resolute were in talks with private equity firm EMR Capital Management Ltd, and today the mine has been sold to EMR Capital Management and Golden Energy and Resources (SGX:AUE).

Resolute said EMR is a “leading” resources-focused private equity company with “outstanding” credentials.

GEAR has coal assets in Indonesia as well as investments in two Sydney-listed miners, Westgold Resources Ltd (ASX:WGX) and Stanmore Coal Ltd (ASX:SMR).

Resolute have said that they will receive AUD100 million in cash and notes for the initial sale of the mine.

Subject to further terms of the deal, a further AUD200 million could be sent Resolute’s way dependent on gold production figures and gold prices.

The sale of Ravenswood comes at no real surprise as the firm was conducting a strategic review of these operations, however Resolute did say that it hopes the mine will produce 200,000 ounces of gold for 15 years from 2022.

in 2019, Ravenswood produced around 55,000 ounces and therefore this could be a good acquisition.

Resolute delighted with the deal

Resolute’s Managing Director and CEO, Mr John Welborn, was delighted with a strongly value accretive transaction:

“The sale of our Ravenswood Gold Mine on the terms announced today provides the opportunity for exceptional value for Resolute shareholders. We have strengthened our balance sheet with a combination of immediate cash and the potential for future upside as well as removing the requirement of a large near-term capital investment. The divestment has strong strategic merit for Resolute. We have delivered on our objective of ensuring a new long-life future for Ravenswood under a world-class operator and can now focus our attention and energy on our African portfolio and the abundant opportunities our experience provides for further growth and value creation.”

“The transaction delivers a fair share to all parties from the future value of the Ravenswood Expansion Project and effectively balances risk and reward. Our modelling at current gold prices demonstrates the expansion project at Ravenswood will be highly successful for EMR Capital and GEAR, and that the maximum value of A$300 million will be generated for Resolute. EMR Capital and GEAR are world-class mine developers and operators with outstanding track records of value generation. The EMR Capital and GEAR consortium are ideal parties to undertake the development of the Ravenswood Expansion Project. The upside sharing arrangement we have agreed aligns the interests of Resolute shareholders with those of EMR Capital and GEAR.”

“Ravenswood has been a consistent performer for Resolute for more than 15 years. Since acquisition in 2004, Resolute has mined and processed over 40 million tonnes of ore and produced almost two million ounces of gold. I congratulate the Resolute team, both past and present, for our performance at Ravenswood. We are proud of our achievements at Ravenswood and the significant economic benefits we have provided to the local community, the Queensland Government, and Resolute shareholders. We are confident Resolute’s legacy, and the interests of all stakeholders in Ravenswood, will be protected and enhanced by the new consortium.”

Resolute grow from strength to strength

It seems that the good news and optimism is surrounding Resolute right now.

On Monday, the firm saw its confidence pay off as it guided for a larger production capacity in 2020 in an update on Monday.

Resolute have announced a target of 500,000 ounces of gold in 2020 which shows a 30% rise on the 383,731 figure reported last week.

With the Syama operations, the firm has said that forecast is expected to around 260,000 ounces which shows a 7% appreciation from the 243,058 figure in 2019.

Resolute outlined an all-in sustaining cost figure of $1,090 per ounce for 2020, however this figure is still being calculated.

At Resolute’s other mine, Mako in Senegal, the company sees mining and processing carrying on at similar rates in 2020 to 2019, though grades will be lower due to depletion of higher-grade stockpiles.

Gold production at Mako is guided at 160,000 ounces in 2020, from 87,187 ounces in 2019.

Additionally, power supply agreement with Aggreko PLC (LON:AGK) is giving the chance for Resolute to make good progress.

The plans come into action following an ensured effort to lower operating costs for Resolute, and the new plans will help reduce power costs by around 40%.

It is fair to say that Resolute over the last few weeks have struck gold, and shareholders should remain thoroughly engaged with the future workings of the company.

Shares in Resolute trade at 62p (-0.18%). 15/1/20 12:54BST.