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Resolute Mining Ltd: THE INVESTMENT CASE
INVESTMENT OVERVIEW

Resolute Mining seeks listing on Main Market of the London Stock Exchange

The gold producer believes the listing will facilitate improved access to gold and African-focused institutional investors.
London Stock Exchange sign
INVESTMENT OVERVIEW: RSG The Big Picture
Resolute is about to start sub-level caving at the Syama mine in Mali

Resolute Mining Limited (ASX:RSG) is seeking a listing on the Main Market of the London Stock Exchange to enhance its growth pathway to becoming a long-life, low-cost, 500,000-ounce per annum gold producer.

The proposed dual-listing is expected to raise Resolute’s profile in global markets and facilitate improved access to gold and African-focused institutional investors.

READ: Resolute Mining begins first stope production at Syama Underground, maintains FY19 guidance

Preparatory work is underway for an application for admission to the standard listing segment of the Official List of the FCA and to the London Stock Exchange for trading on its Main Market.

LSE Admission sought in first half of 2019

Managing director and CEO John Welborn said after completing all regulatory requirements, the company intended to seek LSE Admission during the first half of 2019.

“The London Stock Exchange is a natural home for large mining companies with African exposure,” he said.

“Compelling investment opportunity”

“Resolute presents a compelling investment opportunity to investors in London and internationally who appreciate the scale of operations and our ambition to be a low-cost, multi-mine African-focused gold producer.

“With sub-level caving due to commence at the Syama Underground Mine in Mali in coming weeks, and the associated increasing market relevance of the world’s first fully automated underground mine, we believe now is the perfect time to seek a listing on the Main Market of the London Stock Exchange.”

The automated decline at Syama.

READ: Resolute Mining adds 30,000 ounces from Syama to gold hedge book

To facilitate the listing, the company is changing its reporting financial year end to December 31.

The London Stock Exchange was established in 1698 and has long been home to some of the world’s largest and best-known companies.

There are more than 1,400 companies on the Main Market with a combined market capitalisation of more than $6 trillion.

Strong gold investment culture

Welborn said the investor base of the LSE had demonstrated a strong appetite for mining stocks and a deep understanding of the African operating environment.

He told Proactive Investors that as well as the African investment link there was a strong gold investment culture in the UK.

This culture was much stronger than in Australia, he said, despite the fact Australia was one of the world’s leading gold producers and had a history of gold mining stretching back to the 1850s.

Fill void to be left by Randgold

Another positive for Resolute’s London listing would be the departure of Randgold Resources Limited (LSE:RRS) from the LSE after its merger with Barrick Gold Corporation.

Welborn said this would create a void in the London market for investors seeking exposure to gold miners, a void that Resolute could fill.

The application for listing the company’s shares and LSE Admission is not expected to affect Resolute’s Australian Securities Exchange listing.

Resolute’s MD said the listing application was another step forward in exciting times for the company.

Topping the list of upcoming news flow is the start of sub-level caving at Syama next month.

Syama on schedule and on budget

He said it was pleasing that the underground development at Syama had progressed on schedule and on budget since the plans were first announced around two years ago.

Resolute is developing the world’s first custom-built, fully automated underground gold mine, which will deliver a low-cost, large-scale operation with a mine life beyond 2032 and life-of-mine AISC of US$746 per ounce.

Once in production, Syama will be capable of annually delivering in excess of 300,000 ounces of gold and will underpin Resolute’s growth pathway to a low-cost 500,000-ounce producer.

1,500 people employed at Syama

Welborn said the automation at Syama would not mean fewer jobs. “We employ 1,500 people and this will not change with the automation.

“Automation means operating in a different way with people trained to carry out different tasks to the traditional mining roles.”

He said this had been well received by the locals while the global mining industry was taking notice of Resolute’s progress in adopting technology at Syama.

Technology combined

“This is not new technology, but it is the first time that it has all been put together at the one project.

“The mining industry has not been that successful in adopting new technology across the mine site and we are fortunate that we have a greenfield site that can accommodate the technology and deliver improved production and economics.”

READ: Resolute Mining Limited expects 40% Syama power cost savings with new solar hybrid plant

This week the company revealed that it has signed an agreement for the development of a 40-megawatt independent solar hybrid power plant at Syama.

The plant will combine solar, battery, and heavy fuel oil (HFO) technologies and is expected to result in power cost savings of around 40%.

Resolute’s growth is supported by the operational expertise developed from mining more than eight million ounces of gold from nine gold mines in Australia and Africa over more than 25 years.

The company’s portfolio now hosts global mineral resources of 16.5 million ounces inclusive of 5.9 million ounces of global ore reserves.

Syama to underpin future strategy

Welborn explained that the increased scale at Syama would underpin the company’s future strategy.

This included the development of the Bibiana mine in Ghana, from which the company is targeting annual production of 100,000 ounces over a 10-year LOM at an AISC of around US$750 per ounce.

The strategy also includes benefiting from recent investments in a number of junior gold companies, including Loncor Resources Inc (TSE:LN), Orca Gold Inc (CVE:ORG) and Manas Resources Limited (ASX:MSR).

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