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LONDON (Alliance News) - Bezant Resources PLC Wednesday said discussions about the sale or a potential partnership on the Mankayan copper-gold project in the Philippines are being overshadowed by "uncertainty" about a mining tax that has been proposed in the country as the company slashes wages and cuts costs to preserve cash.
The natural resource explorer operating in Argentina, Tanzania and the Philippines said it has recently implemented a series of initiatives primarily relating to cost controls after conducting an annual review which focuses on reductions in staff salaries across all levels of the company.
Bezant said board salaries and benefits and operational staff salaries have been slashed by 30%, back-dated to March 31 after "each of the company's directors and all of the group's operational staff" agreed to the cuts.
Bezant is "progressing negotiations" with a series of interested parties over the potential sale or partnership of its Mankayan copper-gold project, but said uncertainty about a mining tax proposal made to the Philippines government in 2014 by a civil service body, recommending an increase to a 50% levy.
"In order for Bezant to be able to negotiate from a position of strength and retain strategic options for shareholder growth going forward, the Board recognises that the company's strong cash position must be maintained as far as possible," it said, adding it had a cash balance of around GBP1.9 million at March 25.
"This sizeable reduction in fees, salaries and benefits will assist us in maintaining the group's cash reserves whilst we continue discussions with respect to our Mankayan project in the Philippines, despite the ongoing uncertainty in respect of the country's tax regime. In the current markets, our priority must be to avoid unnecessary dilution for shareholders and maintain strategic options for the company going forward," said Chief Executive Bernard Olivier.
Bezant shares were untraded on Wednesday morning, last trading at 3.10 pence per share.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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