Fura Gems Inc (CVE:FURA) (OTCMKTS:FUGMF) announced on Friday that it has received formal approval from the Ministry of Mineral Resources and Energy of Mozambique (MIREM), for the acquisition of a ruby licence in the southern African nation.
The company said it has completed the previously announced acquisition of SRL Mining Limitada and will take full interests in the Mozambican mining company which boasts ruby mining concession 8955c as well as the ruby exploration license 7414L and a 20% interest in Ibra Moz SA, another mining company in Mozambique, which holds the ruby mining concession 8921C.
In line with a share purchase agreement announced on February 4, Fura Gem’s wholly-owned subsidiary paid GemRock an aggregate price of US$2.1 million for the Mozambique licenses. GemRock is a mining subsidiary of Diacolor International DMCC and its portfolio consists of ruby mining licenses in Mozambique and emerald mining licenses in Colombia and Ethiopia.
The acquisition is an arm’s length transaction to comply with TSX Venture Exchange policies, said the company. Fura is not paying any finder’s fees in connection with the acquisition.
Going forward, Fura expects to get formal approval from the MIREME to acquire the remaining interest in Ibra Moz SA and, with this, the ruby mining concession 8921C as part of its related acquisition.
This expansion of its interest in Mozambique is set to add another 95.15 square kilometers to Fura’s land package in Mozambique’s Montepuez district.
Fura is currently in the process of completing the purchase and sale of interests in three additional ruby prospecting licences in Mozambique as follows:
- A 70% interest in ruby mining licence 5030L through the acquisition of 70% of the issued and outstanding shares of Rubies Resources SA,
- An 80% interest in ruby mining concession 8921C through the acquisition of 80% of the issued and outstanding shares of Ibra Moz SA
- Right to earn a 65% interest in mining concession 8955C under a joint venture agreement collectively termed the New Energy Assets
Meanwhile, in a separate statement, Fura said it has drawn down an additional US$3.5 million from its loan facility. A further US$4.1 million remains available for drawdown by the company at a later date, subject to the terms of the promissory note issued to the lender for a maximum principal of US$28.6 million.
The funds are initially unsecured, and will bear interest at a rate of 10% per annum. The principal amount of the loan, as well as accrued interest, will be payable on the maturity date of August 31, 2021.
The proceeds of the second advance are expected to be used by Fura for the advancement of its Coscuez emerald project in Colombia, its ruby projects in Mozambique and its sapphire projects in Australia. The funds will also be funnelled into acquiring SLR Mining Limitada and getting its ruby mining concession 8955C and ruby exploration licence 7414L.
The Toronto company is involved in the exploration and mining of rubies in Mozambique and is also engaged in the exploration of resources in Colombia where it owns a 76% interest in the Coscuez Emerald Mine in Boyacá.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
Follow her on Twitter: @UttaraProactive