Formation raises $22.4 million for expanded Quebec drilling
Formation Metals Inc. [FOMO-CSE, FOMTF-OTCPK, VF1-FSE] said it has raised $22.4 million from an upsized non brokered private placement and will use the projects to expand an ongoing drilling program at the company’s flagship N2 Gold Project in Quebec. That’s up from an earlier $15 million target.
The private placement consists of 49.8 million units and was closed in two tranches. The first closed on May 19, 2026, and consisted of 31.14 million units comprised of 16.4 million hard dollar units priced at 37 cents per HD unit, 13.02 million flow-through units priced at 44 cents per FT unit, and 1.7 million Quebec flow-through units priced at 44 cents each for gross proceeds of $12.5 million. The second tranche closed on May 21, 2026, and consisted of 18.6 million units, comprised of 2.04 million HD units priced at 37 cents each, 3.6 million FT units priced at 44 cents each and 8.4 million Quebec charity flow-through units priced at 59.6 cents each for gross proceeds of 9.9 million.
The company said it plans use the proceeds to expand its ongoing 30,000-metre drill program at N2 to 75,000 metres. The project contains a global historic resource of 871,000 ounces, consisting of 18 million tonnes of grade 1.4 g/t gold, across four zones and 243,000 tonnes of grade 7.82 g/t gold across the RJ zone.
The N2 property consists of 87 claims that cover 4,4000 hectares of land within the Abitibi subprovince of Northwestern Quebec. The property is just 25 kilometres south of Matagami, Que., and the claims are accessible year-round by provincial highways and logging roads.
In a press release on January 16, 2025, Formation said it had executed an option to purchase a 100% interest in the N2 property from Wallbridge Mining Co. Ltd. [WM-TSX, WC7-FWB]. Formation said it could exercise the option by paying $550,000 cash and issuing 4.0 million common shares. It also pledged to complete $5.0 million worth of work expenditures over six years. Balmoral Resources, which merged with Wallbridge in 2020, acquired the property in 2010. Thereafter, Balmoral conducted a property-wide VTEM, data compilation and IP orientation survey of 14.4 kilometres that covered three known horizons of mineralization. Formation said its maiden campaign has exceeded expectations to date, confirming geological continuity and delivering robust and continued gold intercepts in holes drilled within the northern corridor of the A-Zone, including 1.8 g/t over 21.9 metres beginning at 154.4 metres downhole.
The company said its drill strategy for the remainder of 2026 will focus on extensional drilling to the east and west of the A-zone, along strike where it believes up to 8.0 kilometres may be mineralized in total, and to the south where it recently identified visible gold in a 400-metre step-out drill hole.
On Friday, Formation shares rose 1.4% or $0.005 to 36.5 cents. The shares are trading in a 52-week range of 52 cents and 24 cents.