Regis, Newmont settle $24m liability

Shares in Regis Resources closed higher after it settled a potential liability of $24 million with Newmont Mining, paving the way for the company to finalise funding for its Duketon gold project.

The West Perth-based company today said it had executed an agreement with 22.6 per cent shareholder Newmont which resolves Regis' position as a guarantor of a loan owing from a third party to the gold miner.

Key terms of the settlement are Regis will issue to Newmont an interest-free $10 million convertible note; Regis will issue 5 million options, exercisable at 70 cents each to Newmont; and Newmont's securities will rank behind the primary financier for the Duketon project in Western Australia.

"Finalisation of these matters has enabled the company to finalise funding for the development of the Duketon gold project and settles a potential liability of up to $24 million," Regis said.

The news comes as Regis signed formal documentation with Macquarie Bank for a $45 million debt facility, a performance bond facility of $5 million and hedging facility of up to 300,000 ounces of gold.

The Duketon project is forecast to cost $73 million to develop.

Shares in Regis closed up seven cents, or 10 per cent, to 75c today.