VANCOUVER (miningweekly.com) – Gold producer McEwen Mining has secured a $10-million financing to support a 2018 exploration programme on its newly acquired Black Fox mine and associated assets in Ontario’s Abitibi Gold Belt.
The financing comprises a $10-million bought deal of four-million flow-through common shares priced at $2.50 apiece. Cantor Fitzgerald Canada led the financing as sole bookrunner, backed by BMO Capital Markets, HC Wainwright & Co and GMP Securities.
The offering price represents a premium of 24.4% over the closing price of McEwen common shares on the NYSE on Thursday. Subject to customary closing conditions, the financing is expected to close on December 19.
McEwen, under the able leadership of chief owner and gold bull Robert McEwen, outlined a broad work programme, focused on growing resources and making new discoveries in the Timmins region.
At the Black Fox mine, which it acquired from Primero Mining in October, McEwen plans to undertake deep exploration drilling below the bottom of the known mineralisation as a high priority.
According to McEwen, many mines in the region typically extend to depths of 1 200 m to 1 600 m below surface, while Black Fox currently hosts resources to a depth of only 880 m. The company is currently engaged in deep directional exploration drilling from surface. Lateral exploration to the north-west and south-east of the mine along the same geologic structure is also proposed, based on good geological and geophysical evidence to support the targets.
Further, McEwen will target the Tamarack zone, which is said to be rich in gold and zinc/lead/silver massive sulphide mineralisation, located close to the Black Fox mine.
Other important target areas on the Black Fox property include the areas around the Froome and Grey Fox deposits, which are located 800 m to the west and 4 km to the south of the Black Fox mine, respectively. Froome currently has an underground indicated gold resource of 151 000 oz grading 5.5 g/t. Grey Fox currently has an openpit indicated gold resource of 345 000 oz grading 3.6 g/t, and a further underground indicated gold resource of 323 000 oz at a grade of 5.9 g/t.