Blackham to raise $7m

Gold miner Blackham Resources has announced its third capital raising for the year, bringing the total to $45 million, following a series of delays in production at its gold mines in the Wiluna region of Western Australia.

The company has been plagued with setbacks since transitioning from explorer to producer in 2016, including pit wall slippages and fires at the Wiluna mine and an unusually harsh wet season impacting production output at the Matilda mine in 2017.

Blackham also underwent a strategic board and management team restructure in 2017 intended to focus operating responsibilities for the Matilda and Wiluna gold operations.

Earlier this year, Blackham announced a fully underwritten renounceable entitlements issue to raise around $26 million, of which $10 million would be used to pay debts owing to its contractor, MACA, and The Lind Partners.

In June, Blackham issued MACA with 265 million of its shares in exchange for $12 million working capital to expand its Matilda-Wiluna operation.

Today, the company announced it would raise a further $7 million from a share placement and share purchase plan to fund its key mine development programs.

The placement will issue approximately 411 million shares at 1 cent per share to raise $4 million from domestic and international investors.

The SPP is expected to raise a further $3 million from eligible shareholders able to purchase up to $30,000 in Blackham shares at the placement issue price.

Blackham said the funds raised would go towards pre-production activities at the Williamson open pit near Wiluna, as well as a new tailings storage facility, rod mill refurbishment and general working capital.

In July, Blackham also struck a deal with Perth-based Salt Lake Potash to sell its Lake Way tenements, which will provide the company with $7 million in cash and a $10 million contribution towards its Williamson pre-production activities.

The Lake Way deal is expected to complete in the coming weeks.

Shares in Blackham were down 16.67 per cent to trade at 1 cent each as at 11:50am AEST.