JOHANNESBURG (miningweekly.com) – Gold producer Troy Resources on Wednesday announced a A$38-million capital raising to advance the development of its West Omai project in Guyana, South America.
The group planned to raise up to about A$28-million through an ordinary share placement of up to 22.29-million ordinary shares at A$1.25 a share, followed by a share purchase plan (SPP) to raise up to an additional A$10-million.
“This capital raising is part of the total financing package for West Omai. We are currently in discussions with Investec regarding a new debt facility, that, if secured for the facility size currently contemplated, together with the funds to be raised by the placement, would complete the funding requirements for West Omai. Importantly, the capital raising should also allow us to restart brownfields exploration later in calendar year 2014 at both West Omai and Casposo,” Troy chairperson David Dix said.
He added that the SPP had been included as the company wanted to offer its existing retail shareholders the opportunity to participate in the capital raising.
“It is the intention of all directors that they will apply for the full amount available to them as shareholders under the SPP,” he said.
Troy stated that the funds raised would be used for general earthworks at the West Omai site including roads, camps, site preparation for processing facilities, offices, a tailings dam and other site infrastructure.
The funds would also be used to progress project studies, purchase plant equipment and to conduct resource infill and infrastructure sterilisation drilling.
Meanwhile, following the release of a preliminary economic assessment (PEA) on West Omai last month, Troy was expecting to complete a prefeasibility study (PFS) in the June quarter of this year.
Subject to favourable results of the PFS, securing permits and approvals, the assumptions included in the PEA, Investec providing a new facility for the amount currently contemplated and the placement being fully subscribed, Troy expected that production at the mine could start as early as the second half of the 2015 calendar year.
While work on the PFS was still ongoing, based on the results of the PEA, Troy’s current expectation was that initial capital expenditure requirements, including preproduction mining costs and contingencies, would be $86.8-million for a conventional 750 000 t/y carbon-in-leach plant and mining operation at West Omai.