BornOil enters into agreement to acquire Pahang entity with mining lease

In an announcement that had flown under the radar of the investment community, the Borneo Oil Berhad (BornOil) group announced last Thursday, 25 March 2021 that it had entered into an agreement to acquire an entity with a mining lease in Pahang.

The entity is Syarikat Ratna Pura Sdn Bhd (SRP) which BornOil would be acquiring a 90% stake for RM1.8 million.

SRP has a mining lease issued by the Pahang State Government for an area in Keratong, Pahang. It also has an approved operational mining scheme for mining operations from the Department of Mineral and Geoscience Malaysia, Pahang.

SRP group is principally engaged in mining operations. Its associate company, Syarikat Ratna Pura (Pahang) Sdn Bhd, is principally involved in gold mining operations.

BornOil executive director Datuk Joseph Ambrose Lee explained that this is the first time the group would be owning a mining lease: “Hence, this development marks BornOil’s first foray to seriously venture into gold mining, by owning a mining lease, instead of just being an operator as per our previous arrangements.”

As a result, BornOil would also be eliminating the tribute payable to the concession owner for every ounce of gold recovered. SRP is the concession owner for the mining area and is only subject to payment of royalty to the state government.

Datuk Joseph also explained that the acquisition would result in the group acquiring the mining area adjacent to its current mining area at Keratong, Rompin, Pahang.

“Consequently, BornOil will be expanding our acreage for mining operations within the central gold belt and eastern tin belt of Peninsular Malaysia,” Datuk Joseph further said.

“We would also be able to leverage on our expertise and deep knowledge of the Keratong area, thereby saving on deployment of equipment and machineries to the adjacent mining area for operations,” he added.

“The other plus point is that the mining area is also located in close proximity to major infrastructural utilities,” said Datuk Joseph (second from left in pic).

BornOil’s other Pahang mining venture is at Bukit Ibam.

Dr. Yves Cheze, a member of the Australian Institute of Geoscientists and also the Institute Geology Malaysia, had reported that the first zone of Bukit Ibam is believed to contain total resources of 22,200 ounce or 621,917 gm of gold in 1.66 million metric tons of ore with an average grade of 0.42 g/t.

BornOil is also exploring several other zones in Bukit Ibam that have similar geology as they may hold significant potential for additional gold resources.

BornOil has sole and exclusive rights to prospect, explore, mine, extract, process, sell and collect all revenue of sales with respect to all minerals and precious metals including gold over the said area.

Due to the Movement Control Order (MCO), the second JORC report has been delayed. However, now that MCO has been lifted, BornOil is moving into full swing of the second stage of the JORC report.

On the corporate front, Macquarie Bank Limited has been subscribing for BornOil shares, in line with an agreement that the Australian bank is able to subscribe for up to 1.2 billion placement shares, or 19 percent of the company’s total number of issued shares.

Based on the illustrative issue price of RM0.036 per placement share and assuming full subscription by Macquarie Bank, Bornoil may raise gross proceeds of up to approximately RM43.41 million.

Previous articleWGC And MARii Developing World Glove City, An RM100 Million Glove Manufacturing Hub
Next articleSri Kota Specialist Medical Centre Donates 500 Face Shields To Protect Morning Market Traders


Please enter your comment!
Please enter your name here