African Queen Mines (CVE:AQ) said Thursday that the Ghana mining commission has now extended the term of its prospecting license for the Noyem-Nyafoman gold project until March 2012.
The one-year extension sets the stage for the Vancouver-based company to begin its 2011 exploration program on the property, details of which have already been submitted to the mining commission. The company said work will begin once it receives approval.
The license, which was recently transferred to African Queen Mines' subsidiary from Newmont Mining, covers an area of approximately 28.9 square kilometres within the Birim north district of Ghana's eastern region.
The property lies at the northeastern end of Ghana's gold-producing Ashanti Belt, near Newmont's Akyem deposit, which is now under development for potential production.
The company said the license area has long been host to large numbers of artisinal miners, which could pose some challenges with respect to future development.
"There remain issues to be resolved with a number of the local small scale miners whose claims may be in conflict with contemplated development of a large scale project, and settlement negotiations have been progressing and are ongoing," African Queen Mines said in a statement Thursday.
The company, under a joint venture agreement with Akan Exploration, can earn a 75% interest in the Noyem-Nyafoman gold project. African Queen is designated as manager and operator of the project, and holds the license on behalf of the joint venture partners.