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Blackham's proposed A$60M funding hits buffer

Blackham Resources Ltd.'s proposed A$60 million funding package with Pacific Road Capital will not proceed as agreed, casting doubt on the gold miner's ability to repay a A$14.8 million debt due by the end of the year, The West Australian reported Dec. 21.

The company had announced the previous day that a A$12.3 million rights issue on a 2-for-7 basis, part of the funding package agreement, was also canceled.

In November, the company struck a deal with Pacific Road for the financing, which was to be used to refinance a debt facility, improve reserves and complete expansion studies at the Matilda-Wiluna gold operation in Western Australia.

According to the report, the company's shares have been falling since February as a result of production problems and high operating costs, which resulted in losses of A$400 per ounce to A$700 per ounce from the project in each quarter of the year.