Gold bars, gold
Gold prices are surging and output from the world's existing gold mines are dropping. Now would thus be a good time for Mubadala to go big on a new gold mine. (Image used for illustrative purposes.) Image Credit: Pixabay

Dubai: Abu Dhabi wealth fund Mubadala is getting busy with its gold mine in South America.

This follows an agreement between Mubadala Investment Co. and Aris Gold Corporation for the management and operation of the Soto Norte Gold Project in Colombia. This happens to be one of the world’s biggest ‘feasibility-stage’ gold projects.

Soto Norte, Colombia
Image Credit: Supplied

Soto Norte has an existing resource potential with “additional significant resource upside potential, and the project has the potential to be a large-scale, low-cost, underground gold mining operation”. (On Tuesday, bullion prices are at $1,938 an ounce and showing signs of some firming up. Gold had crossed $2,000 earlier this month.)

Shaping the mine deal

Through a joint venture, Aris Gold will acquire 20 per cent in Sociedad Minera de Santander SAS and Sociedad Minera Calvista Colombia (collectively, Minesa). Aris Gold has an option to acquire a further 30 per cent ownership interest in Minesa, which is the 100 per cent owner of the Soto Norte gold project.

Aris Gold CEO Neil Woodyer will be the CEO of Minesa and lead the preparation of the company’s operational license application. “Aris Gold will use its position as an established member of the Colombian mining industry to ensure the Soto Norte project operates at the highest international sustainability standards,” said a statement issued by Mubadala.

The Executive Director for Industrials at Mubadala and Chairman of Minesa, Danny Dweik, said: “We are delighted to bring in Aris Gold as our operating partner in Minesa. The Soto Norte Project will benefit from their technical capabilities and local market experience, and we look forward to working with them and the project’s local communities to bring this world-class project to fruition.”

On closing, Aris Gold and Mubadala will enter into a comprehensive agreement to govern the joint venture company through which environmental licensing, project development, and mine operation will be undertaken.