logo-loader
viewXtract Resources PLC

Xtract Resources to make a US$700,000 strategic convertible loan notes investment in Moz Gold

The AIM listed firm said it is to make an initial convertible loan of US$400,000 to Moz Gold, with the loan and interest at 30% per annum to be repaid over 5 months

Gold bars
Xtract added that it has the right to convert the loan at any time into a 25% equity interest in Moz Gold

Xtract Resources PLC (LON:XTR) is to make a US$700,000 strategic investment in Moz Gold Limitada, the firm which currently operates the M Block in the Western mining area of its Manica mining concession in Mozambique.

The AIM listed firm said it is to make an initial convertible loan of US$400,000 to Moz Gold, with the loan and interest at 30% per annum to be repaid over 5 months. Xtract added that it has the right to convert the loan at any time into a 25% equity interest in Moz Gold.

READ: Xtract Resources expects “significant increase” in production at Manica after agreeing improved deal with contract miners

The firm said it has also agreed to provide a further US$300,000 convertible loan to Moz with the right to convert that for a further 10% interest in Moz Gold

The company noted that Moz Gold is now in commercial production on the Manica M Blocks, which are wholly-owned by Xtract’s Mozambican subsidiary, Explorator Limitada.

Colin Bird, Xtract’s executive chairman commented: "As owners of the Manica concession, Xtract consider it of shareholder benefit to take a bigger stake in gold production from the concession, since we consider the revenues will be long life and sustainable.”

He added: “This agreement should significantly enhance Xtract's earnings from alluvial activities well beyond initial expectations. All other components of area consolidation are proceeding satisfactorily, and I look forward to updating before year end or certainly early in the new year".

Xtract, which said it is funding the loan from its existing cash resources, saw its shares take on 2.7%, or 0.08p in late morning trading at 2.82p.

READ: Xtract sees first gold poured at Manica

Moz is a private company newly incorporated in Mozambique, and owned by private individuals, which was formed to mine the alluvial gold deposits in the Western area of the Manica concession under contract from Xtract, and it has no other operations.

Quick facts: Xtract Resources PLC

Price: 1.15 GBX

LSE:XTR
Market: LSE
Market Cap: £5.04 m
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of Xtract Resources PLC named herein, including the promotion by the Company of Xtract Resources PLC in any Content on the Site, the Company...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Xtract Resources boosts its interest in Zambia with Eureka project

Colin Bird, executive chairman of Xtract Resources PLC (LON:XTR), caught up with Proactive London's Andrew Scott to discuss an option agreement they've signed on the Eureka copper/gold project in Zambia. Xtract will have an option to acquire a 50% stake in the project before 1 October...

on 5/3/19

2 min read