Gold miner Besra Vietnam suffers massive losses
Gold miner Besra Vietnam suffers massive losses
Canadian Besra Inc.’s Besra Vietnam, the operator of two gold mines in the central province of Quang Nam, namely Phuoc Son Gold Company Ltd. (PSGC) and Bong Mieu Gold Mining Company Ltd. (BMGMC), has suffered a loss of over VND1 trillion ($44.7 million) with a short-term debt volume of VND2.5 trillion ($111.7 million).
According to newswire Vnexpress.vn, the information was released in the first quarter financial report of Quang Nam Mineral Industry Corporation, which holds a 10 per cent stake worth $300,000 in BMGMC and a 15 per cent stake worth $750,000 in PSGC.
According to the report, BMGMC currently has a chartered capital of only $3 million, however, as of June 2014, the company was shouldering a loss of VND674 billion ($30.1 million) with a total short-term debt volume of VND1.144 trillion ($51.1 million).
At the time, the company was forced to suspend its operation due to the massive losses and a lack of capital to maintain operations. Thus, the company has yet to compile a financial report for the 2014-2015 period.
PSGC has also suspended its operations due to lack of capital and huge losses. Notably, the company generated a loss of $15.9 million, $60.6 million of which is short-term debt. It also has not published a financial report for the 2014-2015 period.
Along with the massive losses, in January 2015, Besra Vietnam was warned to have its investment certificate revoked for its delay in payment of taxes and fees as well as late payment fines incurred for environmental pollution.
Besra Vietnam has to face continuous losses as well as financial trouble due to the impact of the global slump in gold prices in recent years. Almost all of Besra Vietnam’s gold is exported, thus, when world prices fell through in 2012, the revenue and profit of the company decreased accordingly.
PSGC was licensed in 2003 and BMGMC in 1991. As of January 2015, they were reported to be owing a combined sum of VND350 billion ($16.4 million) in natural resources tax, contractor tax, value added tax, personal income tax, land rental fees, environment protection fees, and late payment fines.
Besra Vietnam had its bank account frozen and its invoices invalidated in April 2014 by the Quang Nam Tax Department as a result. Three months later, Besra suspended the operation of these mines, saying the decision came as a direct result of coercive measures taken by the Quang Nam Tax Department. On September 30, operations resumed at Bong Mieu mine.
Commissioned in 2006, Bong Mieu gold mine is located in Phu Ninh district. The Phuoc Son site, commissioned in 2011, is in Phuoc Son district and is considered the largest gold mine in Vietnam.
