Aurum Resources is building its bank balance ahead of a beefed-up exploration blitz across its Boundiali gold project in Côte d’Ivoire, with a maiden JORC resource expected before the end of the year.
The company today revealed it had received firm commitments from a $17 million two-tranche placement and is also offering eligible shareholders a shot at a $3 million share purchase plan in a bid to pocket about $20 million.
Management says it will issue about 22.8 million shares under the first tranche of the placement to raise $7.5 million before costs. It will also issue more than 28.6 million new shares, some of which will be snapped up by the company’s directors, subject to shareholder approval at the planned extraordinary general meeting next month to raise some $9.46 million before costs under the second tranche.
As part of the share purchase plan, Aurum will seek up to $3 million through the issue of more than 9 million new shares at the same 33c per share price offered under the placement – representing a 17.5 per cent discount to its last closing price.
In a sign of confidence in the West African operation, Aurum’s directors intend to subscribe for a minimum $1.275 million worth of shares under the placement.
The funds will be used to ramp up the company’s diamond drill campaign at Boundiali to 10,000m per month from its owned-and-operated fleet of rigs. A series of geophysical and terrain surveys, geochemical sampling, metallurgical testwork and the construction of a centralised gold camp are also being proposed with the cash injection.
Aurum Resources managing director Dr Caigen Wang said: “Aurum has an exciting portfolio of gold assets located in a highly-prospective greenstone belt with excellent access to roads, services, power and infrastructure. We look forward to putting investors’ funds to work in confirming the prospectivity of the land package.”
Just last month, Aurum recorded its highest-grade gold hit to date from diamond drilling at Boundiali, with 1m going 163 grams per tonne from 277m. The impressive section was contained within a wider 12.22m intercept grading 14.56g/t gold from 275m that was recorded 60m down-dip from a previous 4m segment at 22.35g/t from 226m.
The latest results were delivered from step-back diamond drilling focused on the company’s BD Target 1 – a 1.3km by 1km-wide gold prospect within a 13km-by-3km mineralised corridor.
Wide and high-grade gold hits are becoming a regular occurrence for Aurum at Boundiali. BD Target 2 is about 6km to the north of BD Target 1, where the company previously reported 73m grading 2.15g/t gold from 172m and earlier this month revealed a 90m-thick hit going 1.16g/t from 143m.
Boundiali is within the same greenstone belt as the Syama and Sissingué gold mines to the north. Syama is sitting on a massive 11.5 million-ounce gold resource and Sissingué has 1.4 million ounces.
To the north-east of Aurum’s ground, the Tongon deposit holds a 5 million-ounce resource and Montage Gold is sitting on 4.5 million ounces at its Koné project to the south.
With a fresh flood of cash set to flow from its placement and share purchase plan, the company appears to be primed to ramp up the development of its bourgeoning Boundiali gold project.
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By Michael Philipps
