Gold explorer 3D hits another Haitian roadblock: now the vendors are revolting
Mining & Resources
Junior gold explorer 3D Resources is battling sovereign risk and uncooperative project vendors as it fights to snare company-making acquisitions in Haiti.
At this stage, 3D reckons it could be tough to complete the acquisition by the end of March – if at all.
First announced in April 2017, 3D (ASX:DDD) has been working hard to complete a company-making deal to buy two Haitian companies with two advanced gold projects, about 30km apart in the north of the country.
The Grand Bois and Morne Bossa gold projects in have a combined gold resource of 740,000oz, according to the company.
In December 2018, 3D asked the sellers to complete a land survey before they signed the deal.
But discussions with the Haitian vendors about validating the land titles have “resulted in disagreement”, the explorer said.
The vendors have also challenged other aspects of the deal extension arrangements.
“Given its previous dealings with the vendors and the sovereign risk, the [3D] will proceed cautiously and with consideration to its Haitian legal advice to ensure that the companies being acquired have good title to the land that is subject to the mining projects,” 3D told long-suffering investors.
It’s been a frustrating process
3D entered into an agreement to buy a controlling interest in the two Haitian companies in April 2017.
They then kicked off due diligence in May and acquired 70 per cent in the two companies in August.
In November, the company mentioned “slight delays” in obtaining necessary permits to import crucial drilling equipment from neighbouring Dominican Republic, which continued well into 2018.
Disagreements with its Haitian partners started soon after.
A new revised acquisition agreement was presented in October, with the 3D confident it would all be signed, sealed and deliver by the end of November.
In December, the acquisition still remained subject to satisfaction of a number of conditions including validating the land titles.