Canadian firm re-opens Vietnam gold mine

By Toan Dao   August 18, 2016 | 02:25 pm GMT+7
Canadian firm re-opens Vietnam gold mine
Besra Gold operates a gold ore vehicle during a restart ceremony at Phuoc Son mine, Quang Nam on August 17. Photo by Vietnam People's Police Newspaper

The company hopes to strike it rich under a mountain of debt.

Canada’s Besra Gold Inc has resumed operations at its Phuoc Son gold mine in Vietnam’s central province of Quang Nam after two years of suspension, the company said in a statement on Wednesday.

Besra Gold also owns the Bong Mieu mine in Quang Nam, but the company suspended operations at the two mines in July 2014, saying the decision came as a direct result of coercive measures taken by the Quang Nam Tax Department due to delayed tax payments.

The Phuoc Son mine was able to return to operations after VietABank provided a bank guarantee to the local tax department, and local partner Vaco Gold Co Ltd contributed essential capital for the resumption of operations and payment of local creditors, Besra Gold said.

Phuoc Son is one of the biggest gold mines in Vietnam with estimated reserves of 30 tons.

Besra's tax debts from Phuoc Son are VND430 billion (nearly $19 million), Dinh Van Thu, chairman of Quang Nam People’s Committee, said in a meeting in early July.

The Canadian company has promised to pay all debts within 12 months of the resumption of operations at Phuoc Son, according to a report from VietnamPlus on August 17.

As of June 30, 2014, the Phuoc Son mine had lost $16 million while the Bong Mieu operation had reported accumulative losses of $30.1 million and short-term loans of VND1.14 trillion (over $51 million).

Besra Gold, which also owns a gold mine in Malaysia, reported an overall loss of nearly $46 million and short-term loans of VND2.5 trillion (over $112 million) as of June 30, 2014.

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