JOHANNESBURG (miningweekly.com) – ASX- and TSX-listed Heron Resources has secured the full A$240-million funding package required for the construction and ramp-up of its Woodlawn zinc/copper project, in New South Wales.

The package comprises a loan, equity and stream funding package from subsidiaries of Orion Mine Finance Group for A$129-million, an equity subscription agreement with a subsidiary of existing shareholder Greenstone Resources and coinvestment parties for A$42-million and an equity subscription agreement from new cornerstone equity investor, Castlelake, for A$33-million, as well as  the receipt of commitments from various sophisticated and professional investors to subscribe for fully paid ordinary shares in the company to raise about A$32-million.

The issue price for the new shares under the funding package was A$0.07 a share, and represents a 14% discount to the volume-weighted average price of Heron shares traded on the ASX during the ten days up to June 26.

Heron is also offering eligible existing shareholders the opportunity to participate in a share purchase plan to raise up to a further A$5-million at the same price as the institutional placement and the equity component of the funding package with cornerstone investors.

Commenting on the funding package, MD Wayne Taylor said Heron’s operations team and its lead contractor, Sedgman, were ready to start construction of the project immediately upon securing shareholder approval for the transaction. The company aims to commission Woodlawn in late 2018.

As part of the funding package, Orion nominee director Peter Rozenauers and Castlelake nominee director Ricardo De Armas have joined the Heron board.

"The backing of the major equity investors Greenstone and Castlelake provides a very strong endorsement of the potential for our project. With their commitment and the support of major funder Orion, we look forward to progressing Woodlawn into production in 2018 and developing Heron into a substantial base metals company in the future," said Taylor.

At steady state, Woodlawn is expected to produce 70 000 t/y of zinc concentrates, 30 000 t/y of copper concentrates and 25 000 t/y of lead concentrates.