PERTH (miningweekly.com) – Embattled gold miner Troy Resources has released details around a "series of transactions" that if approved by shareholders, could see the company raise A$7.2-million in cash and retire a further A$18.7-million of net debt.
Troy on Monday said that one of the potential transactions could see AIMS converting essentially all of its gold loan, in two stages, into approximately 627-million shares, in so doing, becoming Troy’s largest shareholder.
Troy’s largest trade creditor, Exploservice Guyana, could also potentially convert approximately 40% of its debt into approximately 209-million shares in Troy, with M&G, Troy’s current largest shareholder, subscribing for approximately 122-million shares, raising approximately A$2.7-million, while the company’s current second-largest shareholder, Ruffer could subscribe for approximately 68-million shares, raising approximately A$1.5-million.
RiverFort Global Capital, a London-headquartered investment services firm, could also potentially subscribe for approximately 23-million shares, raising approximately $0.5-million, with RiverFort providing the company with convertible note funding up to $5-million.
In addition to these potential transactions, which will be subject to shareholder approval, Troy will also undertake a one-for-one rights issue, which will be priced at the same issue price as the share placement, being 22c a share.
Troy, which has been in a trading halt since August last year, on Monday reported that gold production during the September quarter had reached 659 oz, which was obtained from processing remaining stockpiles and minor ore from the Goldstar pit. Mining operations ceased during July 2021 with the Karouni mill entering into care
Gold sales revenue for the quarter was $2.4-million from the sale of 1 319 oz in July 2021.
Troy told shareholders that work during the September quarter concentrated on completing the prefeasibility study (PFS) of the Smarts Underground Ore Reserve, which concluded that the Smarts Underground deposit was economically viable.
The PFS included a calculated total cost of $3.7-million to arrive at the upper stoping blocks from the start of development mining, with construction of the actual portal and initial infrastructure of between $2-million and $4-million, meaning the cost to first ore is relatively minimal at approximately $7-million.
Troy said on Monday that a further three geotechnical holes need to be drilled so as to finalise the geotechnical assessment and, in turn, the mine plan. Subject to finalising the geotechnical assessment and meeting the funding requirement, Troy will proceed with the development of the Smarts Underground mine.
Troy has previously said that until the Smarts Underground project is sufficiently advanced to warrant a final investment decision, the Karouni mill will remain on care and maintenance.
During this time the company will continue to progress with undertaking development planning, including detailed specifications, for the development of the Smarts Underground project, as well as continue with general exploration activities. Additionally, the company also remains in discussions with a number of companies that own gold deposits or promising projects close to the Karouni mill for potential toll treating opportunities.