Besra Gold said that all the preceding conditions to the previously announced $300m gold purchase agreement (GPA) with Quantum Metal Recovery have been met.

The parties signed the agreement in May 2023. Quantum Metal Recovery is also a major shareholder of Besra Gold, which is an Australia-based gold exploration company.

According to the gold purchase agreement, Besra Gold has committed to selling a volume of refined gold sourced from the Bau gold project in Malaysia or any other gold project held by the company or its subsidiaries.

The arrangement will continue until Quantum Metal Recovery obtains 3,000,000 ounces of refined gold, or Besra Gold receives aggregate deposits totaling $300m from Quantum Metal Recovery, whichever comes first.

As per the agreement, Quantum Metal Recovery has initially deposited $5m and will subsequently deposit up to $10m into Besra Gold’s drawdown account each month.

Quantum Metal Recovery has confirmed the deposit of $10m into Besra Gold’s drawdown account, with the funds expected to be received no later than the first week of next month.

Under the facility agreement, Besra Gold has the authority to allocate the proceeds from the facility for various purposes, including exploration, feasibility studies, mine development, and working capital. An important focus for the company is said to be the update of the 2012 Bau Feasibility Study.

The company has clarified that the facility is non-debt, interest-free, and is anticipated to eliminate the necessity for dilutive equity financing or project/corporate debt, which could entail hedging obligations and/or burdensome contractual agreements.

The facility, which is payable over 30 months through future gold production ounces, will provide Besra Gold with complete funding for the production at the Bau gold project and the assessment of other deposits in the Bau goldfield corridor.