Rose Petroleum PLC (LON:ROSE) has told investors that its disposal of the SDA Mill gold operation in Mexico is now nearing completion and it has struck an interim agreement with the buyer, allowing operations to restart at the project.
The company said that the final major item required for closing, a restructuring of Mexican ownership of SDA, is at an advanced stage and it due to be in place later this month.
It agreed to let Magellan Gold Corporation start toll-milling operations at SDA because the completion was now deemed ‘imminent’ and because a commercial opportunity had arisen for the project – it is now treating 100 tons of third party ore per day.
As a result of the interim deal, Magellan agreed to place the US$900,000 total cash consideration for SDA into escrow.
Mathew Idiens, Rose chief executive, said: "As we near completion of the disposal, we are encouraged by the commitment shown by both parties with the interim milling agreement, allowing for operations to recommence at the SDA mill and Magellan taking on a fully operational business at completion. We look forward to updating the market shortly on progress."