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Baker Steel Resources Trust agrees to invest in Azarga Metals

It gives BSRT exposure to the Unkur copper-silver project in Russia
mining truck
The investment will be in the form of convertible debt

Baker Steel Resources Trust Ltd (LON:BRST), in a statement after Thursday’s close, revealed an agreement to invest US$3mln into Azarga Metals Corp, a company listed on the Toronto Ventures Exchange.

It is investing via a 4-year term 8% secured convertible loan.

Azarga intends to use the injection of funds to support a second-phase drilling and exploration programme, aimed at increasing resources at its wholly owned Unkur copper-silver project, in Russia.

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BSRT will also receive share warrants and it will secure an option to acquire a net smelter royalty (of up to 2%) for US$5mln.

The company highlighted that the investment valued Azarga at US$9mln on a pre-money basis.

It also noted that a preliminary economic assessment last year valued the project at US$206mln, based on an 8-year open pit mining operation producing 13,200 tonnes of copper and 3.7mln ounces of silver per year.

“A significant increase in the resource is anticipated to lead to further improvement on the initial positive PEA results,” BSRT said in the statement.

“The project benefits from good existing infrastructure such as grid power, road access and nearby rail and is located around 20km from Udokan, one of the world's largest copper development projects.”

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