Classic Minerals’ US$60m forward sales facility provided by AuResources still in force
AuResources has now met certain KYC and compliance requirements, paving way for initial tranche to be released
First round will help fund development of production capacity at the Kat Gap gold deposit
Special Report: Classic Minerals has confirmed that its US$60m funding agreement with AuResources is still in force with the latter having just met certain KYC (know your customer) and compliance requirements.
In February 2024, the company had executed a binding terms sheet with the Swiss fintech startup for a project development facility of up to US$60 million that will be supported by Luxembourg-based Black Manta Capital.
Classic Minerals (ASX:CLZ) will receive an initial US$10m to further develop production capacity at the Kat Gap deposit and progress development of the Lady Magdalene and Lady Ada deposits at the Forrestania gold project in Western Australia.
Repayment of this first tranche will be carried out in six quarterly payments and can be made in gold bullion in lieu of cash at CLZ’s discretion if it has started commercial production at Kat Gap during the facility period.
AuResources can also advance the company a further US$50 million in five equal tranches subject to previous advances having been repaid by delivery of gold bullion in six equal quarterly deliveries starting six months after each relevant advance.
CLZ recently upgraded resources at Forrestania, which covers ~50km strike of the Forrestania greenstone belt and includes the Kat Gap deposit, to 377,946oz of contained gold, up from the previous estimate of 311,050oz.
It was recently granted a 21-year mining lease for Lady Ada and Lady Magdalene gold projects at Forrestania and raised $2m for exploration and development.
Funding to start flowing through
The company has now confirmed that the funding facility with AuResources is still in force and that the fintech startup will soon release the initial funding tranche after meeting certain KYC and compliance requirements.
It added that the use of funds remains unchanged though the timetable has changed due to the delay in timing of funds released.
However, AuResources has made a transfer of US$67,974 in order to confirm the operation of the financial pathway and also to reinforce its commitment to the agreement with CLZ.
“We’re excited with the prospect of providing funds to Classic Minerals and partnering with Black Manta Capital Partners, a global company, who have also confirmed that this transaction is one that they and their investors are enthusiastic about,” AuResources chief executive officer Ian Cooper said.
CLZ chairman John Lester said the company was appreciative of AuResources and Black Manta Capital Partners in evaluating and endorsing its gold projects as being suitable for their consideration and investment.
“The launching of this round of funding puts Classic firmly on the international scene. We will now have the capacity and capability to deliver value to AuResources, Black Manta Capital and our shareholders,” he added.
This article was developed in collaboration with Classic Minerals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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