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InDABA ReVIeW

Fekola expansion fuels B2Gold

for now and beyond

ith a portfolio of assets on the cusp is set to be announced
Wof collectively churning out 1 moz, next month following
B2Gold Corp is focused on growth via ex- completion of a recent
ploration rather than M&A, for the next little infill drilling campaign.
while at least. B2Gold is set to
B2Gold has forecast group production spend $US18 million of
of 1-1.05 moz in 2020, with some 47% of its $US50 million group
that output attributed to the expanding Fe- exploration budget in
kola mine in Mali. Mali during 2020.
Fekola was acquired by B2Gold in 2014 “Fekola has been an
via its takeover of Australian explorer Pap- extraordinary story of
illon Resources as an undeveloped 4 moz success,” Johnson said.
deposit. Construction of a 4 mtpa opera- “When we acquired
tion began the following year. Fekola – and it’s pretty
Last October the TSX-listed company hard to believe now – in
started expanding operations to 7.5 mtpa 2014 in a friendly takeo-
with construction works to be completed ver of Papillion…they
in Q3. Fekola will then produce 550,000 like many smaller com-
ozpa for the next five years. panies couldn’t raise the
Overwhelming exploration success at money to build it. We
Fekola – including the discovery of a new paid a premium, but it
deposit, Anaconda, 20km to the north – was a highly accretive
was a key catalyst for the expansion and, deal for B2Gold. We
according to B2Gold chief executive Clive were heavily criticised at
Johnson, organic growth is where the best the time because there
value now lies for the company and its was no competition.
shareholders. “We paid $US500
“A lot of people ask me about our strat- million in our shares to
egy and are we in the hunt for M&A,” John- takeover Papillion. Im-
son told delegates at Mining Indaba. agine if the gold was
“The short answer is ‘no, we’re not’ and there today. Even if you
there’s a reason for that – we did the heavy have the original 4 moz
lifting when very few people were doing it. of resources, I would
We acquired and built Otjikoto [in Namibia] suggest bidding would
and acquired and built Fekola when ac- start at $US1 billion.
quisitions and construction were so out of Fekola, because of our Clive Johnson
favour, unfortunately due to the poor per- rapid exploration while
formance of so many other companies. we were building it, the resources are now significant producers and pay a dividend.”
So, we’ve done the heavy lifting and had a basically 8 moz when you include Anacon- A mining study for the Wolfshag under-
great growth spurt and now we’re expand- da to the north, so we think we were right ground at Otjikoto is also due in the com-
ing those projects. to foot the bill.” ing months.
“When you look at all that, everything in Johnson expects his company to pay Johnson reiterated that exploration
our pipeline and all our exploration capa- down the remaining $US200 million of its would be critical to B2Gold’s ongoing suc-
bilities, why would you do M&A? Because debt later this year and will once again look cess for at least the next few years.
it’s not getting easier, it’s getting tougher. to distribute a dividend to shareholders. “What I find in this industry, which hap-
There’s no Fekolas that we see out there B2Gold declared its first dividend – 1c/ pens far too often, is someone discovers
today because there’s been very little ex- share on a quarterly basis – last Novem- a deposit and then it’s handed over to the
ploration done in the last 10 years to find a ber. engineers,” he said.
similar project. And there’s plenty of com- “The ultimate strategy for us, which “Being engineers, they are extremely
petition around now, so why would we try we’re achieving, is to be a company that risk averse, so they don’t tend to think or
and outbid other companies for marginal continues to use some of its profits to value exploration that much, which is kind
assets?” grow, find more gold and build more gold of funny because without exploration suc-
Johnson said his company acquired mines, and then return some of it to our cess I’m not sure what engineers would do
Fekola knowing the project’s exploration loyal shareholders,” he said. with their time.”
upside was unrivalled to anything else the “I think that’s a great gold mining com- – Michael Washbourne
B2Gold team had cast their eyes over. pany if you can get to that place. There’s
An updated reserve estimate for Fekola only 10 gold mining companies who are

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