tamaya blocks potential sale of mill

the age newspaper

Tamaya blocks potential sale of mill

January 31, 2007 - 4:54PM
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Copper and gold miner Tamaya Resources Ltd says a contractual option over a mill prevents BMA Gold Ltd from selling the plant after the former gold miner went into voluntary administration.

BMA Gold was forced into administration on Tuesday after being advised by its financier it was in default of its loan facilities and company directors were unable to organise alternative funding.

The former gold miner has cash on hand of about $2 million but a bank debt of $4.2 million.

Tamaya, formerly SMC Gold Ltd, said it had a contractual option to acquire the Rishton Mill at Charters Towers in Queensland and the plant could not be sold without its approval.

"We continue to regard this option over the Rishton Mill as a valuable asset of the company at a time of favourable gold prices and with regard to our gold exploration prospects in this area," Tamaya said.

Tamaya said it had written to the administrators to advise that it intended to preserve its rights under the agreement.

BMA Gold hit trouble earlier in the year when it was forced to downgrade the reserves at its mainstay Twin Hills project and close the operation due to complex geology.

The former gold miner said it would work with administrators Ferrier Hodgson to try to execute a new funding plan to recapitalise the company.

Shares in Tamaya were down half a cent to 18 cents while BMA Gold was untraded after last trading at 10.5 cents.

© 2007 AAP