Borneo Oil buying mining company for RM5 million

PETALING JAYA: Borneo Oil Bhd's unit is buying over 95% of Jusra Mining Merapoh Sdn Bhd, a miner of minerals and related activities including quarrying and processing of precious metals, ores and minerals, for RM5 million.

On July 21, 2004, Jusra was awarded a contract appointing it the main contractor to carry out prospecting and mining of minerals on five prospecting blocks covering an area of about 389.7ha at Lipis, Pahang. In 2013, one of the prospecting blocks was granted a mining lease covering 202.8ha, with potential alluvial gold reserves of 720kg.

Borneo Oil will finance the acquisition with the proceeds from its rights issue exercise and internally generated funds, it told Bursa Malaysia in a filing.

The deal gives Borneo Oil and Gas Corporation Sdn Bhd (BOG), which was appointed a subcontractor for the mine, the opportunity to become the main contractor.

This position will give BOG the locus standi to negotiate and discuss various operational matters directly in the interest of BOG with the relevant authorities. It will also give access to BOG to represent its interest in its other mining operations at Mukim Batu Yon under another sub-contract agreement with Champmark Sdn Bhd.