In the meantime, it continues to hold preliminary talks with a number of parties to raise additional funds, either through assets sales or new equity investments to repay debt and provide cash to resume exploration and testwork on its Hellyer gold property.

Bass managing director Mike Rosenstreich said while still at an early stage, a range of options were being discussed including corporate, joint venture and divestment transactions.

The cash-strapped miner said its plan to restructure and pay down debts through cash generation from the stage 1 mine plan at its Hellyer operations was progressing according to plan.

Regrettably, however, Rosenstreich staff and contractors would be made redundant and all affected employees had been advised of the changes.

The company had been hit with technical problems at its embattled Hellyer operations, which had reduced the funds available to pay off its debts.

It previously blamed an unexpected reduction in metallurgical performance of the lead circuit at Hellyer, while poor metal prices and mining costs for the December quarter being 11% over budget at $115 per tonne contributed to its problems.

Late last month, Bass advised it had received a lifeline from its bank RMB Australia Holdings which had agreed to changes to the terms of its secured loan facilities subject to conditions.

It said the debt repayment plan was progressing well, with liabilities of $15.4 million to RMB and $8.5 million to other creditors.

Based on current receivables, metal prices and operational performance, Bass plans to have reduced its overall debt position to about $10 million in the September quarter, before contributions from any asset realisations or additional financing.

Meanwhile, the operational performance at Hellyer in the latest quarter was in line with budget forecasts and the recently implemented “work-out” plan following several adverse technical issues.

To conserve cash and reduce risks, the plan does not include any mine development and is focused only on the extraction of already developed ore, meaning mining will be completed at the end of this month and milling by early June.

A total of 132,506 tonnes of ore was produced in the latest quarter, grading 6.7% zinc, 3.7% lead, 99 grams per tonne silver, 2gpt gold and 0.27% copper versus the budgeted rate of 115,103t of ore at 9.5% zinc, 4.5% lead, 88gpt silver, 2.2gpt gold and 0.4% copper.

It brings year to date numbers to 332,985t of ore grading 7.5% zinc, 4.2% lead, 102gpt silver, 1.7gpt gold and 0.31% copper.

The mining contract was varied from the alliance based structure to a fixed cost of $58.10/t of ore delivered to the run of mine stockpile.

Shares in Bass Metals were down 12.5% in afternoon trading to 0.7c.