AuMega Metals adds $7.3 million to Newfoundland exploration fund
AuMega Metals Ltd. [AUM-TSXV, AUMMF-OTCQB, AAM-ASX] has closed the $7.3 million second tranche of a private placement financing that will be used to fund a drill program of up to 20,000 metres in Newfoundland and Labrador.
The second tranche consisted of 128 million ordinary shares which were issued to institutional, professional and accredited investors, consisting of:
- Hard dollars: 2 new shares priced at 5.0 cents.
- Flow-through: 34.3 million new shares priced at 6.0 cents per share.
- Premium flow-through: 28.5 million new shares at a premium flow-through price of 6.825 cents per share.
The second tranche placement was in addition to a previously announced first tranche closing, whereby the company issued 131.15 million ordinary shares, raising proceeds of $8.77 million.
AuMega shares were unchanged Wednesday at $0.045 and trade in a 52-week range of 12 cents and $0.04.
AuMega holds a district-scale land package with several projects located along the highly prospective, but under explored Cape Ray Shear Zone (CRSZ) in Newfoundland and Labrador. The company has mineral licenses covering 110 kilometres of continuous strike along the CRSZ.
It has outlined 610,000 ounces of gold grading 1.96 g/t gold predominantly in the Cape Ray Project, one of eight projects in its portfolio.
Proceeds from the financing will be used primarily to advance the company’s exploration program in Newfoundland and Labrador, which is expected to include the company’s largest drill program in the past three years of up to 20,000 metres with an aim to increase the existing mineral resource and the discovery at the highly prospective Bunker Hill project. Additionally, the company will continue to invest in early-stage exploration activities to further define and advance new and existing targets at Hermitage and Malachite.
The company said he latest results from Bunker Hill, with peak gold-in-till values of 94 ppb and 148 ppb gold, further increase our confidence in the prospectivity of the project and it now has three large zones identified as high priority for future drilling.
“The bottom line is that we have a massive land package along a major gold structure that already hosts our own mineral resources as well as Calibre Mining Corp.’s [CXB-TSX, CXBMF-OTC] five million ounces at the Valentine Project. In my experience, large deposits in greenstone belts are rarely “one-offs,” but rather they are one of multiple deposits hosted in a belt,’’ said AuMega CEO Sam Pazuki. “We have used our best-in class exploration techniques to test areas, identify new targets and advance projects forward,’’ he said. “Bunker Hill is a prime example of one of these projects where we have allocated limited capital to date but have advanced it to the stage where substantial drilling is now confidently justified.’’
It is worth noting that as many of the company’s projects are covered by glacial overburden, it has developed a Canadian-Australian hybrid approach to exploration to more effectively deploy capital to better he understand zones that could host major deposits by sampling through the glacial overburden to source gold in bedrock.