07:26 AM EDT, 04/12/2024 (MT Newswires) -- Steppe Gold ( STPGF ) overnight Thursday said it had reached a final agreement to buy Boroo Gold LLC from Boroo Pte Ltd. subsidiary Boroo Singapore in an all share deal.

Steppe, which in January had announced its plans to buy Boroo Gold, also said it will sell its Tres Cruces oxide project to Boroo Singapore for about $12 million in cash, payable over 18 months starting at the closing date. The deal is expected to create Mongolia's leading gold producer and result in Boroo Singapore owning about 56% of Steppe Gold ( STPGF ).

Boroo Gold estimates it will mine more than 400,000 ounces of gold from 2024 to 2031, with projected average annual production of about 60,000 ounces in 2024, 2025 and 2026. In 2023, Boroo Gold had revenue of US$132 million on production of 67,315 ounces of gold, with an AISC of $847 per oz, at an average achieved gold price of $1,957 per oz. Boroo Gold is forecasting similar production levels in 2024, albeit with higher sustaining costs.

"This transaction accelerates our path to a multi-asset Mongolia-focused mining group and, importantly, immediately provides strong cash flow to support our growth plans, further improved with the recent strong gold prices," said Steppe Gold ( STPGF ) Chairman and CEO Bataa Tumur-Ochir.

The transaction, which has the backing of Steppe's board, still needs the regulatory green light and must be approved by Steppe Gold ( STPGF ) shareholders. The deal is conditioned upon the closing of the Tres Cruces transaction.