PERTH (miningweekly.com) – ASX-listed Intermin Resources has announced a strategic joint venture with fellow-listed Eastern Goldfields, as well as a A$4.7-million capital raising.
Under a heads of agreement signed between the two companies, Eastern Goldfields has committed to spend up to A$7-million to gain an interest in Intermin’s Menzies and Goongarrie gold project areas, in Western Australia, as well as taking an interest in the company.
Eastern Goldfields will sole fund and manage A$5.5-million of exploration and development studies at the project areas over the next four years, to earn a 65% stake in the tenements.
The junior said on Monday that access to the Menzies and Goongarrie projects and resources was aligned with the company’s plan to complete a bankable feasibility study into the development of a standalone mill at its own Mt Ida hub.
“The Menzies project may also offer a viable alternate location for the positioning of a second production hub away from Davyhurst, potentially accessing gold resources from the north, east and south of Menzies,” said Eastern Goldfields executive chairperson Michael Fotios.
Intermin MD Jon Price said that the collaborative approach would enable the accelerated exploration and mining inventory growth to underpin dedicated processing infrastructure in the Menzies region, to mutual benefit.
In addition to the earn-in at the project areas, Eastern Goldfields would also subscribe for A$1.5-million of Intermin shares. Eastern Goldfields would subscribe for 12.5-million new shares in Intermin, priced at 12c each, with the placement likely to occur in two tranches.
The subscription agreement forms part of Intermin’s larger plans to raise A$4.7-million by way of a share placement. The company will place some 39.25-million shares, at 12c each, to raise the funding.
The issue price represents a 16.4% discount to Intermin’s volume-weighted average price over the last five days.
The share placement will be undertaken in two tranches, with the first 32.17-million shares being placed under the company’s existing capacity, and not requiring shareholder approval.
In addition, Intermin will also offer five-million new shares to eligible shareholders under a share purchase plan, to raise an additional A$600 000.
Price noted that the funds would be used to develop the Teal Stage 1 gold mine, accelerate drilling programmes at Teal, Peyes Farm, Blister Dam and Windanya, as well as for potential acquisitions and working capital.
“We are now well-funded to develop the Teal Stage 1 gold mine with our mining partner, accelerate exploration drilling and aggressively explore our assets in the Kalgoorlie region and at Menzies and Goongarrie, in collaboration with Eastern Goldfields for the benefit of all our shareholders.”