Shanta Gold (LON:SHG) and Canada’s Great Basin Gold (TSE:GBG, JSE:GBG) have finished the due diligence for their joint venture in Tanzania.
The deal, which was announced on June 1 this year, concerns the Lupa gold region.
Both firms are now satisfied that all suspensive conditions set out in the contract have been met or have been waived, said today's statement from Shanta.
Executive chairman of Shanta, Walton Imrie said: "As Shanta Gold moves from explorer to producer, first at New Luika at the end
of December 2011 and then at Singida in 2013 we believe that the highly prospective areas, which fall within the JV Agreement, provide excellent opportunities for Shanta Gold to grow beyond its first two mines.
He added that he looked forward to receiving positive results from both firm's highly experienced exploration teams.
Great Basin Gold's chief executive Ferdi Dippenaar, said he believed the teams' experience and expertise can result in further low cost resources in the Lupa gold camp for the benefit of both companies' shareholders.
In June, Great Basin agreed to sell an 80-per cent interest in its assets in the Lupa region in return for Shanta committing to spend US$12 million over a period of three years.
The deal had the proviso that if Shanta discovers a resource in excess of 500,000 ounces above a 1.5 gram per tonne cut off, as well as delivering a feasible mine plan, the expenditure commitment would fall away.
The properties are in the highly prospective Lupa gold camp, which extends over around 3,800 square kilometres and partially lies adjacent to the New Luika Gold mine. Great Basin Gold's regional exploration has, to date, identified seven potential drill targets