Besra Gold Inc Announces Termination of December Contract Note with Quantum Metal Recovery
BEZ (BEZ) Share Update July 2024 Tuesday 16th
Besra Gold Inc Terminates December Contract Note with Quantum Metal Recovery
Besra Gold Inc (ASX:BEZ) has announced the termination of its December 2023 contract note with Quantum Metal Recovery Inc, citing the latter's inability to remit agreed funds.
Instant Summary:
- Termination of December 2023 contract note for gold delivery.
- Quantum Metal Recovery Inc failed to remit US$9.8 million.
- Gold Purchase Agreement (GPA) remains intact.
- Quantum has provided over US$25.6 million to Besra to date.
- Besra continues to advance the Bau Gold Project.
Termination of Contract Note
Besra Gold Inc (Besra) has announced the termination of its December 2023 contract note with Quantum Metal Recovery Inc (Quantum). The contract note was for the delivery of 98,140 ounces of gold at a price of US$2,002.82 per ounce. Despite Quantum's efforts and confirmations, the agreed funds of US$9,827,854.60 have not been received by Besra.
As a result, both parties have mutually agreed to terminate the contract note. However, the Gold Purchase Agreement (GPA) between Besra and Quantum remains intact, allowing Quantum to make additional monthly payments as per the GPA.
Statement from Chairman Dato Lim
In a statement issued on 16 July 2024, Mr. Dato Lim, Chairman of both Besra and Quantum, refuted recent claims about Quantum's financial position and commitment to Besra. He explained that Quantum's inability to deliver the funds was due to third-party contract failures. Despite this setback, Mr. Lim reaffirmed Quantum's ongoing support for Besra and its commitment to the GPA and the Bau Gold Project.
Gold Purchase Agreement Details
To date, Besra has received US$25,646,326 (~A$38 million) under the GPA. These funds are non-dilutive for CDI holders, are not debt, are interest-free, and will be retained by Besra. The company believes it has sufficient funds to carry out its current business plans, which include further development at the Bau Gold Field, construction and commissioning of the Jugan Pilot Plant, and pre-development activities in other key Bau Gold Field concessions.
Future Plans
Besra looks forward to increasing its activities at Bau, including the commissioning of the Jugan Pilot Plant and advancing the definitive feasibility study, subject to obtaining regulatory and environmental approvals.
The termination of the December contract note may cause some uncertainty among investors regarding Besra's immediate cash flow. However, the continued support from Quantum and the intact GPA provide a cushion. The company's significant funds raised to date and its ongoing projects at the Bau Gold Field are positive indicators for long-term growth.
Investor Reaction:
Investor reactions have been mixed. Some investors express concern over the delayed funds, while others are reassured by Quantum's ongoing support and Besra's substantial funds raised under the GPA.
Conclusion:
Investors should keep an eye on Besra's progress with the Bau Gold Project and the company's ability to secure additional funds. The termination of the contract note, while a setback, does not appear to derail Besra's long-term plans. Staying informed on further announcements and project developments will be crucial for investors.