Malaysian miner Besra Gold (ASX:BEZ) has pocketed another US$10.65 million from its largest shareholder, Quantum Metal Recovery, under a May Gold Purchase Agreement (GPA).
It’s the second US$10 million drawdown to be received from Quantum in as many months, and combined with an initial US$5 million deposit, Besra has now banked more than US$25.64 million as part of the arrangement.
Under the terms of the GPA, Besra, which has a $71.9 million market capitalisation, has agreed to sell to Quantum up to 3 million ounces of refined gold from its Bau project in East Malaysia, in which Besra is busy earning a 97.8% interest.
In return, Quantum will provide Besra aggregate deposits of up to US$300 million. The GPA concludes when either Besra has sold the full 3 million ounces or received the full US$300 million, whichever comes first.
Besra reiterated to investors that this facility with Quantum is not debt: it’s interest-free and is expected to remove the need for dilutive funding or corporate debt for the progression and development of the Bau project.
The Bau project contains multiple brownfield exploration projects and hosts a combined resource of 72.6 million tonnes @ 1.43 grams per tonne (g/t) Au for 3.3 million ounces of gold, as well as an exploration target of between 4.9 million ounces and 9.3 million ounces of gold.
As part of its GPA with Quantum, Besra is entitled to spend the proceeds of the facility in a variety of ways, including for exploration, feasibility studies, mine development, or general working capital.
Besra is currently working to update the 2012 feasibility study for the project and commission a pilot plant in the area.
Shares in Besra Gold have increased by 6.67% to $0.16 as of 2:30pm AEDT on 27 November.
Write to Joshua Smith at Mining.com.au
Images: Besra Gold
