The government of Tajikistan and Nelson Gold (NLG-T) have reached an agreement on the gold sales, royalties and taxes related to Nelson’s operations in the country.
Production from Nelson’s 49%-owned Zeravshan Gold will be refined at the Vostokredmet Refinery and sold for U.S. dollars. Proceeds of the sales will be held in a bank outside Tajikistan.
Zeravshan’s profits will be taxed at a rate of 16% from 1996 to the year 2000, increasing to 25% by 2006. The profits will also be subject to a 3.5% royalty, which will jump to 6% in 2006.
Nelson has raised $11.5 million through a private placement of 11 million shares at $1.05 per share. The company is developing the Jilau and Taror gold deposits, which contain a total gold resource of 6.7 million oz., and expects to produce 47,000 oz. gold from Jilau this year.
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