(Alliance News) - Xtract Resources PLC on Tuesday said a subsidiary in Mozambique has signed a mining contractor agreement at its Boa Esperanza hard rock gold deposit.
Boa Esperanza is located at the Manica mining concession in Mozambique and Longhau Tianci Mining Co Ltd has been appointed to mine the asset for six years, or until the ore body is depleted.
The deal will see Xtract unit Explorator receive 20% of gold output after the settlement of mining production tax.
Explorator will also remit 35% of its share of Boa Esperanza output to Mutapa Mining & Processing Lda, its collaboration partner.
Executive Chair Colin Bird said: "I am pleased to report the conclusion of negotiations and signing of the Boa Esperanza agreement with Longhau. Boa Esperanza has had only limited drilling and as such the contractor plans to open the veins progressively and follow the vein and ore shoot.
"This approach is common to this type of ore body and it is not unusual for mines to still be in production for many years after their original ore estimate."
Xtract shares were 0.4% higher at 1.83 pence each in London on Tuesday morning. The stock was as high as 2.00p earlier on Tuesday.
By Eric Cunha; ericcunha@alliancenews.com
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