The Resolute Mining Limited (ASX: RSG) share price is one to watch today after the group’s strategic review update.
What could be moving the Resolute share price today?
The Resolute Mining share price climbed higher on stronger gold prices yesterday and is on watch again today, after the Aussie miner reported it has initiated a strategic review process to evaluate options for its Bibiani Gold Mine.
The group is reviewing its plans to recommission the Ghana-based site as well as assess capital requirements and funding alternatives.
It’s also investigating recently received expressions of interest from third parties seeking to acquire the asset.
That last part could see the Resolute Mining share price climb higher in early trade. The potential for an asset sale is enough to make the group’s shares worth watching this morning.
Resolute is looking to maximise shareholder value through the strategic review while keeping local stakeholders onside. The group wants its Ghana partners to see the economic and social advantages that its Bibiani site could provide.
What’s the story behind the Bibiani Mine?
Resolute acquired Bibiani back in 2014 through a scheme of arrangement supported by the Ghanaian Government. It’s a historically significant gold mine and has been a major gold producer in western Ghana.
The group’s feasibility studies suggest the potential for 100,000 ounces of gold from the site per year. This production could be achieved at a life of mine all-in sustaining cost (AISC) of US$764 per ounce over a 10-year mine life.
How has the Resolute Mining share price performed this year?
It hasn’t been the easiest year for the group’s shareholders. The Resolute share price has climbed just 3.93% higher and has underperformed the S&P/ASX 200 Index (INDEXASX: XJO) in 2019.
The benchmark index has climbed 20.71% higher, but many of the Aussie gold miners have struggled.
Newcrest Mining Limited (ASX: NCM) has been the exception, outperforming the index and its peers to climb 31.05% higher this year.
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Motley Fool contributor Kenneth Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.