Jadar has signed a metal streaming term sheet with a newly incorporated, Malaysia domiciled fund, VCI Holdings, for up to US$17 million in funding that can be used to build the plant and buy the machinery needed to unlock the gold and silver resources at Yanamina.

 

VCI was established by Jadar executive director Navin Sidhu.

 

The first $5 million can be accessed in early 2022 assuming the final conditions are met, and an updated prefeasibility study is completed.

 

Under the agreement, Jadar is required to deliver at least 850 ounces per month of refined gold for about 15 months.

 

Once 13,000oz has been delivered, the agreement will throttle back to 250oz per month, plus refined silver that matches 100% of the silver production from Yanamina for the month.

 

The pricing is set at $400/oz for the gold and $2.50/oz for the silver.

 

The agreement is envisaged to tick along until all raw ore and tailings are processed from Yanamina's five concessions, although Jadar can terminate the gold streaming deal after delivery of 24,000oz for $5 million if the gold price increases above $2500/oz for 14 days.

 

One of the conditions of the agreement requires that Jadar offer VCI two board seats, with Sidhu already filling one.

 

Jadar's other executive director Adrian Paul said the funding would help advance the company's wider Latin American precious metals strategy. 

 

Yanamina was secured in February 2020. It is a bulk mining opportunity containing 6.7 million tonnes grading 1.23 grams per tonne gold and 4.3gpt silver for 265,9870oz gold and 934,528oz silver, using a 0.5gpt gold cut-off. 

 

The resource is open at depth and along strike. 

 

VCI will be granted a security over either Jadar's shares or the Yanamina assets in return for the funding, and given the deemed disposal of an asset and related party links, shareholder approval will be sought before December. 

 

Jadar also has lithium and boron interests in Europe, an option over the Tierra Blanca gold-silver-zinc-lead project in Mexico, and the Khartoum tin-silver-tungsten asset in Queensland's Herberton mineral field.

 

The company started the June quarter with A$2.4 million cash following a recent $1.8 million raising at 3c, plus it has a $10 million standby placement agreement with Mint Capital Advisors.

 

Jadar's stock has traded between 1.1-5.1c over the past year, and were last traded at 2.9c, valuing it at $20 million.