African gold producer Endeavour Mining Corp (TSE:EDV) will sell its interest in its non-core Tabakoto mine in southwestern Mali to Algom Resources, a subsidiary of BCM Investments Ltd, for a total of US$60mln in cash.
Endeavour's current ownership ranges from between 80% to 90% depending on the pits, with the rest owned by the government.
"We are pleased to continue to pursue our portfolio management strategy through the sale of our non-core Tabakoto mine," said Sebastien de Montessus, Endeavour's president and chief executive.
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"This will increase our overall portfolio quality and allow management to focus on high cash-generating assets with low AISC and long mine lives.
"Tabakoto has been sold following a comprehensive review which determined that the capital investments required to reduce its AISC did not meet our capital allocation criteria."
Last year, Tabakoto produced 144,000 oz (ounces) of gold at an AISC (all-in-sustaining-cost) of $1,148 per ounce. Tabakoto produced 53,000 oz at an AISC of $1,298 per oz for the first half of 2018.
"We are very pleased for the opportunity to enter into this arrangement with Endeavour," said Algom's chief operating officer Peter Spivey.
"The Tabakoto mine has been well established as both an open pit as well as underground mining operation for a number of years and we recognize it has excellent geological potential to continue operating well into the future."
Endeavour operates five mines across Cote d'Ivoire (Agbaou and Ity), Burkina Faso (Hounde, Karma), and Mali (Tabakoto).
In addition, it aims, via exploration, to discover 10-15Moz (million ounces) of gold between 2017 and 2021, representing more than twice the reserve depletion during the period.