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Loncor's Adumbi enters JV with Barrick re DRC permits

2020-06-24 07:34 ET - News Release

See News Release (C-LN) Loncor Resources Inc (2)

Mr. Peter Cowley of Loncor reports

LONCOR EXPANDS JV RELATIONSHIP WITH BARRICK IN DRC

Loncor Resources Inc.'s 76.29-per-cent-owned subsidiary, Adumbi Mining SARL, has entered into a joint venture agreement with Barrick Gold (DRC) Ltd. for two exploitation permits held by Adumbi Mining covering ground contiguous to the company's Imva area within the Ngayu gold belt in the northeast of the Democratic Republic of the Congo (DRC). The purpose of the new Barrick JV is to conduct exploration on the JV permit properties to evaluate possible development and mining of such properties.

The Ngayu gold belt lies approximately 220 kilometres from the Kibali gold mine, operated by Barrick. Kibali produced record gold production of 814,000 ounces of gold in 2019, at all-in sustaining costs of $693 (U.S.) per ounce.

The terms of the new Barrick JV are similar to Loncor's continuing joint venture agreement with Barrick which covers over 1,894 square kilometres of ground in the Ngayu gold belt including, among other properties, certain properties in the Imva area. Under the new Barrick JV, Barrick will manage and finance all exploration of the JV permit properties until the completion of a prefeasibility study. Once the joint venture committee has determined to move ahead with a full feasibility study, a special purpose vehicle (SPV) would be created to hold the specific discovery areas. Subject to the DRC's free carried interest requirements, Barrick would retain 65 per cent of the SPV with Adumbi Mining holding the balance of 35 per cent. Adumbi Mining would be required, from that point forward, to finance its pro rata share of the SPV in order to maintain its 35-per-cent interest or be diluted.

The closing of the new Barrick JV, which is expected to occur by July 18, 2020, is subject to certain closing conditions customary for transactions of this nature.

Arnold Kondrat, chief executive officer of Loncor, stated: "We are pleased to see Barrick's confidence in the Ngayu gold belt continue to grow. This new Barrick JV further consolidates the control of the Ngayu gold belt by Loncor and Barrick as partners."

About Loncor Resources Inc.

Loncor is a Canadian gold exploration company focused on the Ngayu greenstone belt in the northeast of the Democratic Republic of the Congo. The Loncor team has over two decades of experience of operating in the DRC. Ngayu has numerous positive indicators based on the geology, artisanal activity, encouraging drill results and an existing gold resource base.

Qualified person

Peter N. Cowley, who is president of Loncor and a qualified person as such term is defined in National Instrument 43-101, has reviewed and approved the technical information in this press release.

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