AbraSilver raises $30 million from bought deal financing
AbraSilver Resources Corp. [ABRA-TSXV, ABBRF-OTC] said it has raised $30 million from a bought deal public offering of 11.7 million shares priced at $2.55 per share. The total includes the full exercise of the over-allotment option.
Net proceeds from the offering will be used to fund the continued advancement of the company’s wholly-owned Diablillos property in Salta Province, Argentina.
In addition to, and current with the offering, the company intends to complete a previously announced private placement of up to 11.2 million common shares in connection with the exercise of participation rights held by an affiliate of Central Puerta SA and Kinross Gold Corp. (K-TSX, KGC-NYSE) at the issue price, generating gross proceeds of up to $28.5 million.
In early trading Friday, AbraSilver shares rose 2.0% or $0.06 to $3.06. The shares trade in a 52-week range of $3.58 and $1.32.
Last year, the company announced a substantial increase in the mineral resource estimate for its wholly-owned Diablillos property.
The new mineral resource estimate consisted of updated estimates for the Oculto deposit, plus estimates for the JAC, Fantasma and Laderas deposits, all of which are located to the west/southwest of Oculto. All four deposits are located on the Diablillos property.
The latest estimate included a 36% increase in the contained silver in measured and indicated mineral resources to 148 million ounces (up from 109 million ounces in an earlier estimate. The increase is primarily attributed to the JAC deposit.
Other highlights included a 32% increase in the average silver grades in measured and indicated resources to 87 g/t silver, up from 66 g/t. This is due to higher silver grades in the JAC deposit and higher equivalent cut-off grades at Oculto.
The 80 square kilometre Diablillos property is located in the Argentina Puna region – the southern extension of the Altiplano of southern Peru, Bolivia and northern Chile. The project was acquired from SSR Mining in 2016.
There are several known mineral zones on the property, with the Oculto zone being the most advanced, with over 90,000 metres drilled to date. Oculto is a high-sulphidation silver-gold deposit derived from remnant hot springs activity.
AbraSilver chief geologist David O’Connor said the updated mineral resource estimate represents a major milestone for the company. He said the company is pleased to see a significant increase in both the quantity and grade of silver mineralization, stemming from the discovery of the high-grade Zac zone.
Zac contains a measured and indicated resource of 36.2 million ounces of AgEq. By comparison Oculto hosts a measured and indicated resource of 218.3 million ounces of AgEq.