West-Perth based explorer Besra Gold has signed a $US300 million funding deal with one of its major shareholders.
West-Perth based explorer Besra Gold has signed a $US300 million funding deal with one of its major shareholders.
The ASX-listed junior explorer signed a pre-purchase and offtake funding facility term sheet with Malaysian gold distributor Quantum Metal Recovery.
The facility will provide up to $US300 million, to be paid (drawn down) over 30 months against future production ounces, to enable Besra to develop its Bau gold project in Malaysia.
The gold explorer plans to immediately update its feasibility studies for the second quarter of 2023 and expects to start commercial-scale production within the next 12 to 18 months.
The funding is expected to be delivered at up to $US10 million per month, according to Besra.
The facility will be settled by way of delivery to Quantum of up to 3 million ounces of gold according to an agreed percentage of production at an agreed floating gold reference price, but subject to a floor price.
Chairwoman Jocelyn Bennett said the funding would alter Besra’s trajectory and provide a clear pathway to gold production at the Bau project.
“At a time when access to capital for emerging gold producers is difficult and typically highly dilutive, the board is very pleased to have removed this impediment to Besra’s growth," she said.
“We now have a clear line of sight on commencing production at Bau, with our issues (issued) capital intact, as well as recourse to little, if any, debt and the restrictive covenants typically required by lenders.”
Quantum Metal Recovery is a Malaysian gold distributor and one of Nesra’s major shareholders.
“We are most pleased to have entered into the agreement with Besra and play a part in continuing the long tradition of gold mining in the Bau region which goes back just over 200 years,” Quantum executive chairman Dato Lim Khong Soon said.
“As a major shareholder in the company, we are excited at the potential of the Bau project which we anticipate this funding will unlock.”
In 2021, Besra Gold restructured) the company and relisted on the ASX after raising $10 million at 20 cents apiece.
Formerly based in Canada, Besra was delisted from the Toronto and Australian stock exchanges in August 2015 when it hit insolvency.
The restructured gold explorer is now based in West Perth.
On the ASX, Besra Gold shares were up 60 per cent to trade at 6.4 cents at 2.01PM AEDT.
