JOHANNESBURG (miningweekly.com) - Emerging Australian gold explorer Matrix Gold on Tuesday reported that it would use the A$5-million from its initial public offering (IPO) to fast-track a project in Central Victoria into production by mid-year.
Matrix, which plans to list on the ASX in March, said in a statement that it would use funds from the IPO to move its Burkes Flat gold project, 65 km northwest of Bendigo, into production in the second quarter.
Chairperson Karl Sabljak said that State Government approvals were in their final stages.
The Burkes Flat project has a resource of 196 000 oz of gold in measured, indicated and inferred categories, with 65 000 oz of potential open cut gold.
The company also plans to use funds from the IPO to develop four other projects, namely the Wehla, McIntyre, Saint Arnaud South and Amphitheatre projects, all near Bendigo and Ballarat.
Matrix further planned future expansion of the company through strategic acquisitions, mergers and joint ventures.
"We have a strong belief in the mineralisation similarities between our Wehla project and Northgate Minerals Corporation's nearby, multi-million ounce Fosterville project," Sabljak said.
The minimal exploration carried out to date at Wehla has produced a high proportion of "encouraging" drill results, and Sabljak added that the company believed that this project had the potential to be a multi-million ounce project.
He noted that Matrix Gold's fundamental belief in the gold prospectivity of Victoria had been vindicated by the large scale developments of the Fosterville gold mine, which hosts almost 2,5-million ounce gold resource, and the Stawell gold mine, which hosts almost 700 000 oz gold resource.
"Our Wehla, Burkes Flat and McIntyre projects have similar geological settings and a major purpose of this capital raising is to adequately fund the continuing exploration and development of these projects."
Matrix holds three mining licences and six exploration licences which have established gold mineralisation in over 600 km2 of tenement holdings in an area of significant historical and present gold production, and close to existing infrastructure.
The Matrix Gold IPO is offering 25-million shares at 20c a share to raise A$5-million.
If fully subscribed, the company would have a total of 50-million shares on issue with a market capitalisation of A$10-million upon listing on the ASX.
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