As part of the deal, B2Gold will fund investment and exploration at Gramalote next year to the value of $13.9 million and will assume management of the project in January 2020.

The companies have also agreed on a feasibility study budget of about $40 million to fund 42,500 metres of infill drilling and 7,645 metres of geotechnical drilling for site infrastructure.

B2Gold said it expected to complete those activities by the end of May 2020.

The budget will also fund feasibility work, including an updated mineral resource, detailed mine planning, additional environmental studies, metallurgical test work, engineering and detailed economic analysis, the Vancouver-based company said.

“We believe the Gramalote project has the potential to become a low-cost open pit gold mine,” B2Gold chief executive, Clive Johnson, said. “The project has several key infrastructure advantages including reliable water supply, close proximity to key infrastructure and a technically capable workforce in country.”

Gramalote received the first environmental license awarded by Colombia in 35 years in December 2015. The permit gave the partners three years to work through social aspects related to the project, including relocating artisanal miners and some residents in the area.

AngloGold, which also has operations in South Africa, wholly-owns another project in Colombia. That venture, the Quebradona copper and gold project is currently undergoing a feasibility study, the company said in a separate statement.

The joint venture partners believe that Gramalote project, located 230 km. northwest of Colombia’s capital Bogotá, has the potential to become a large, low-cost open pit gold mine.