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Highlights:

  • Antilles Gold and Xinhai sign LoI for AUD 26 million EPC contract at Nueva Sabana.
  • The company plans to raise AUD 4.13 million via share placement if MoU proceeds.
  •  MLV grants Xinhai first rights for future La Demajagua development.

Antilles Gold Limited (ASX:AAU) has announced the signing of a non-binding Letter of Intent (LoI) between Chinese engineering group Shandong Xinhai Mining Technology Equipment Inc. (“Xinhai”) and Minera La Victoria SA (“MLV”), a Cuban mining company jointly owned by Antilles Gold and the Cuban Government. The agreement outlines a proposed AUD 26 million engineering, procurement, and construction (EPC) contract for the Nueva Sabana copper-gold project in central Cuba.

The LoI includes an intention for Xinhai to provide or facilitate up to AUD 16 million in project financing. Additionally, Antilles Gold has agreed, subject to a binding Memorandum of Understanding (MoU) being executed by 15 August 2025, to issue 590 million AAU shares to Xinhai or its nominee at AUD 0.007 per share, raising approximately AUD 4.13 million. Should the placement proceed, Xinhai would be invited to nominate a representative to the Antilles Gold Board.

Xinhai, a privately owned mining services company, has previously completed over 500 EPC contracts globally. The scope of the proposed EPC contract at Nueva Sabana includes the construction of a 500,000 tonnes per annum concentrator, supporting buildings, electrical infrastructure, procurement of equipment and consumables, and associated services. The financing terms suggest that Xinhai will disburse funds equivalent to around 60% of each monthly EPC progress payment, with repayment scheduled in five equal quarterly instalments beginning three quarters after mine commissioning.

As part of the arrangement, MLV will be responsible for constructing key site infrastructure such as haul roads, the tailings storage facility, and water management systems. MLV will also oversee construction management, safety, administration, and compliance with government requirements. The agreement further permits Xinhai to bring its senior construction team and technical staff from China to Cuba.

Both Xinhai and MLV will aim to finalise an operating agreement covering the concentrator’s operations, maintenance, and procurement activities for a minimum of two years. Xinhai personnel are expected to participate in plant operations and support functions during this period.

MLV has also granted Xinhai the first right of refusal to negotiate the EPC contract, estimated at AUD 70 million, for the proposed La Demajagua mine, which is scheduled for development between 2027 and 2028. Xinhai may also be involved in the Definitive Feasibility Study (DFS) for La Demajagua, including metallurgical testing and budget preparation.

Additionally, Antilles Gold retains an option to purchase any antimony product generated by the La Demajagua project at prevailing Chinese market prices.

Xinhai is expected to complete its due diligence on the Nueva Sabana project in July 2025, including meetings with Cuban stakeholders and a site visit. Final contract terms and scope are expected to be established in the MoU.

Antilles Gold is developing two previously explored mineral deposits in Cuba through its 50:50 joint venture with GeoMinera SA, a Cuban government mining entity. The Nueva Sabana project is at an advanced stage, and the La Demajagua open pit project is planned as a follow-up development. The joint venture’s longer-term strategy includes reinvesting future cash flows into exploration across major porphyry copper targets such as El Pilar and areas within the Sierra Maestra belt.

Antilles Gold operates under Cuba’s Foreign Investment Law and related environmental regulations. The Cuban government has approved holding project funds in offshore accounts, with only local expenses transacted in-country, reducing potential country credit risks.

As of 11 July 2025, Antilles Gold were trading at AUD 0.0050 on the Australian Securities Exchange.