1st Jul 2016 07:44
LONDON (Alliance News) - Noricum Gold Ltd Friday said it has raised over GBP1.0 million to fund work in Georgia after the miner signed a deal to acquire an interest in the David Garedji gold and copper prospect with its existing partner.
The miner is primarily focused on the Bolsini copper and gold project in Georgia and is working with Caucasian Mining Group. Noricum has now signed a non-binding heads of terms to acquire an interest in the David Garedji prospect which will lead to Noricum and Caucasian jointly evaluating and developing the asset.
The prospect is situated within Caucasian's mining and exploration licence in Georgia and due diligence will be conducted before the deal is finalised.
In order to fund the necessary work, Noricum has conducted an oversubscribed placing of 785.7 million new shares priced at 0.14 pence each to raise a total of GBP1.1 million. That placing price is more than a 12% discount to the company's closing share price on Thursday.
Noricum shares were trading up 1.3% to 0.162 pence per share on Friday morning.
The shares issued under the placing represent around 16.4% of the company's enlarged issued share capital, which stands at 4.79 billion shares following the transaction.
Noricum said the prospect could add significant resources to its inventory in Georgia and offers another chance to begin production in the medium term. The prospect has already undergone underground development work and over 25,000 metres of diamond drilling has been conducted.
Historic "Soviet" resources at the project, which are not JORC-compliant, suggests there could be 460,000 ounces of gold, 740,000 ounces of silver, 50,000 tonnes of copper, 130,000 tonnes of lead and 150,000 tonnes of zinc within David Geredji.
"Like Bolnisi, David Garedji is advanced, high grade and scalable and as well as increasing our resource inventory substantially, it presents us with a further near-midterm production target to add to the three we have identified from the 17 defined areas we inherited on the acquisition of Bolnisi," said Chief Executive Greg Kuenzel.
"We are currently finalising our production and processing agreement with Caucasian so that we can commence production from our Kvemo Bolnisi starter pit in the third quarter of 2016 and, with this in mind, I hope shareholders will be encouraged by this announcement which represents a strengthening of our professional relationship," he added.
By Joshua Warner; [email protected]; @JoshAlliance
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