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Sula surges after strategy update reveals plans to farm-out Ferensola or find a joint venture partner

Published: 18:38 18 Oct 2017 AEDT

Gold bar on a dollar bill
"The challenge faced by Sula in the current climate is how best to develop this project," said Roger Murphy, Sula's CEO

Sula Iron and Gold PLC (LON:SULA) is considering adding further assets to its portfolio.

In a strategy update, the gold exploration company said the search for suitable new assets is taking place alongside detailed analysis and structural interpretation work on its Ferensola gold project in Sierra Leone.

READ: Ferensola grades 'verging on Bonanza' says Sula Iron & Gold chief

Once that analysis is completed, Sula intends to examine various options for the further development of Ferensola on the back of the very encouraging and high-grade gold intersections over several targets across the Ferensola licence. 

The current plan is to solicit expressions of interest for a joint venture or farm-out of the project. The board is of the view that this will provide a cost-effective means to “prove-up” the potential inherent value that the company believes this project contains.

"The challenge faced by Sula in the current climate is how best to develop this project with a view of maximising value for our stakeholders,” declared Roger Murphy, Sula’s chief executive officer.

“With that in mind the board has commenced a process to evaluate how best to continue developing Ferensola's gold asset and also to bring in additional opportunities to the company.  The board believes that these should not only increase value, but also mitigate single project financing risk,” he added.

The market liked the sound of the joint venture/farm-out idea, and drove Sula’s shares 10% higher to 0.088p in early deals.

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