Understanding Gold Sale Offers, Assay-Based Pricing and Payment Terms

Two gold purchase offers can quote the same discount to a published gold price and still produce different final payments. Sellers should compare what is measured, which gold content is payable, which deductions are permitted and when money is actually released.

Begin with an agreed quantity

Identify the material form and the measured gross and net weight. Ask whether the buyer proposes to purchase the material by gross weight, estimated contained gold or independently determined fine-gold content. A test result for a small sample has to be connected to the lot by an agreed sampling process.

An assay report should identify the method, sample and units. XRF can be useful for preliminary screening; a suitable representative Fire Assay may be more appropriate for final composition discussions. Neither method proves ownership or an export entitlement.

Find the payable basis

Ask which gold-price benchmark is referenced, the currency, the fixing time or date, and the purity and weight used in the calculation. Clarify any payable percentage and deductions for refining, treatment, transport, tax, insurance, financing or sampling. Do not rely on a headline 'minus x percent' offer when the remaining costs are unspecified.

For a simplified example, if a hypothetical lot contains 100 units of measured gold and the written terms make 95% of that gold payable, payment is calculated on 95 units before the agreed price reference and remaining deductions are applied. This is an illustration, not a price quote or an accepted industry deduction rate.

Define acceptance and settlement

The contract should state where inspection takes place, how differences between laboratory results will be reconciled, what constitutes acceptance, who holds the material and how payment is released. For an international transaction, also clarify the exact delivery term and allocation of transport and insurance risks.

Bank transfer, documentary credit and escrow are different mechanisms. A credible settlement proposal should identify the responsible institution or escrow agent and allow the parties to verify its authority independently. An unsigned draft escrow agreement does not show that funds are secured.

Compare offers on a single worksheet

Put each offer into the same format: lot weight, assay basis, fine-gold quantity, price reference, payable fraction, itemised deductions, payment timing, document conditions and delivery responsibilities. Leave uncertain values marked 'not yet agreed' instead of inventing them. The better offer is the one the seller understands and can verify, not automatically the offer with the largest number at the top.

How Bilex may assist

Bilex provides gold testing and can discuss selling opportunities, buyer introductions and transaction support. It may purchase selected small quantities directly, while larger selling opportunities are generally handled through introductions. When Bilex is buying the material, that role should be documented and its own laboratory report must not be described as independent third-party verification. Analytical findings must never be changed to support an agreed sale price.

Next step: Obtain the full written pricing formula and sampling agreement before deciding whether a proposed gold sale is acceptable.