Earlier today, Besra Gold Inc (ASX: BEZ) secured approval from its shareholders to implement a US$300,000,000 gold offtake drawdown facility provided by Quantum Metal Recovery Inc.
In accordance with the Facility, Quantum made an initial deposit of US$5,000,000 and is able to provide up to US$10,000,000 in funding each month, up to a total of US$300,000,000; all of this money is deposited into a drawdown account that is managed by Besra Gold.
It is anticipated that the initial ten million dollars in US currency would be received by the end of September or before. Besra Gold is now able to fully fund production at the Bau Gold Project and evaluate other properties located within the Bau goldfield corridor as a result of the Company’s agreement to deliver to Quantum up to 3,000,000 ounces of future gold generated from the Company’s projects in exchange for the Facility.
Besra is permitted, under the terms of the Facility, to put the revenues towards a number of other uses, such as mine development, exploration, and feasibility studies, in addition to providing working capital. Besra says that the Facility is one of the largest deals of its kind to have been signed by an ASX-listed junior, and more significantly, the Facility does not constitute any kind of debt and does not accrue any interest.
It is anticipated that the Facility, which will deliver up to ten million dollars in US currency each month, will eliminate the demand for dilutive equity financing and project/corporate debt that would burden Besra with hedging obligations and/or onerous covenants.
Introduction to the Besra Gold Bau Project
The Bau Gold Project is located on the island of Borneo and is centred on the municipality of Bau. It is approximately 30–40 kilometres away from Kuching, the capital city of the state of Sarawak in Malaysia. Besra maintains direct and indirect control over 97.8% of the Bau Gold Project’s total stake, which comes to 92.8% when equity is taken into account.
This project is located near the westernmost point of an arc-shaped metalliferous belt that runs through the middle of the island of Borneo.
The Bau Gold Project is characterised by a gold-bearing mineralisation system that extends across an area measuring roughly 8 kilometres by 15 km.
Within this region, Besra has found JORC (2012) Resources of Measured 3.4 Mt @ 1.5 g/t Au for 166.9 koz, Indicated 16.4 Mt @ 1.57 g/t Au for 824.8 koz, and Inferred 47.9 Mt @ 1.29 g/t Au for 1,989 koz.
The Project also has an overall Exploration Target that ranges from 4.9 Moz to 9.3 Moz. Deep water ports, an international airport, grid power, communications, and a plethora of service providers are all conveniently located in the area.
