American Pacific raising $4.5 million from upsized financing
American Pacific Mining Corp. [USGD-CSE, USGDF-OTCQX, 1QC] said it has increased the size of a previously announced non-brokered private placement financing, which is now expected to raise $4.5 million. That’s up from an earlier $3.0 million target.
The company said it will issue 22.5 million units priced at 20 cents each in a private placement that is fully subscribed. Each unit consists of one common share and one-half of one share purchase warrant, each of which entitles the holder to acquire one additional share for 30 cents per warrant share for two years from the date of distribution.
News that the placement has been upsized to $4.5 million came after the close of trading on April 3, 2024, when American Pacific shares closed at 28 cents. The shares trade in a 52-week range of 42.5 cents and 17 cents.
In August, 2022, American Pacific said it had agreed to acquire Constantine Metal Resources Ltd. in an all-share transaction that combined advanced projects in Alaska and the western United States.
They included the preliminary economic assessment (PEA)-stage Palmer zinc-copper-gold-silver massive sulfide project in Southeast Alaska. American Pacific’s partner is Dowa Metals & Mining Co. Ltd. of Japan.
Palmer hosts two NI-43-101-compliant resources, the Palmer Deposit and AG Zone Deposit, with a combined resource of 4.68 million tonnes of 10.2% zinc equivalent in the indicated category and 9.59 million tonnes of 8.9% zinc equivalent in the inferred category.
A PEA, which was amended in March, 2022, envisages a low capex, low operating cost, high margin underground mining operation with an 11-year mine life at 3,500 tonnes per day and a pre-production capital cost of US$278 million.
Another key asset will be Madison, a past-producing high-grade copper-gold skarn and porphyry system located in Montana. The project is being advanced under an earn-in joint venture deal that allows Kennecott Exploration, a unit of the Rio Tinto Plc [RIO-NYSE] to earn a 70% interest by spending US$30 million.
In a press release on March 25, 2024, American Pacific announced the approval of a US$12.8 million budget for the Palmer VMS project. The company said the 2023 program delivered the best four copper intercepts drilled to date at Palmer, highlighting the opportunity to define copper-rich zones within the known mineral resource envelope.
It said the US$12.8 million program has been designed to continue expanding the known extent of the high-grade copper mineralization within the South Wall Zones 1 and 2. The 2024 program will also include a series of step-out drill holes to test the nearby North Wall target.
The company is also planning to drill the Madison copper-gold project this year. Plans include a near-mine 1,350-metre (five-hole) Phase 1 diamond drilling program and a Phase 11 regional drilling program. Drilling within the skarn will aim to confirm and extend mineralization in historical drilling which returned 14.69 metres of 12.10 g/t gold (CO5-06) and further downhole 61.63 metres of 6.97% copper.