Regulus raises $11.5 million for drilling in Peru
Regulus Resources Inc. [REG-TSXV] said Friday it has raised $11.5 million from a bought financing that included 7.8 million units priced at $1.06 per unit. The units consist of one common share and one half of one common share purchase warrant.
Each full warrant entitles the holder to purchase one common share of the company at $1.70 per share for a period of 24 months after the date of closing.
The bought deal portion of the financing raised $8.25 million after the underwriters chose to exercise an over-allotment option.
Regulus also completed a non-brokered private placement of 3.07 million units that were sold to certain funds managed by Route One Investments Co. LP, the company’s largest shareholder, at the offering price. The private placement generated an additional $3.25 million.
Regulus is an international mineral exploration company with a portfolio of precious and base metal exploration projects located in North and South America.
It said net proceeds will be used to fund exploration and development activities at the company’s 100%-owned AntaKori copper-gold-silver project, which is located in the Yanacocha-Hualgayoc mining district in northern Peru.
Regulus shares advanced on the news, rising 5.3% or $0.06 to $1.19 on volume of 355,642. The shares are currently trading in a 52-week range of $1.02 and $2.
AntiKori is located 620 kilometres north of Lima, the capital of Peru and 53 kilometres northwest of the city of Cajamarca in an area where exploration dates all the way back to the 16th century. AntiKori is situated in the mountains of the Western Cordillera at an altitude of 3,725-4,000 metres above sea level.
The project is estimated to host an indicated resource of 250 million tonnes grading 0.48% copper, 0.29 g/t gold, 7.5 g/t silver, 0.74% copper equivalent or 2.6 billion pounds of copper, 2.3 million ounces of gold, 61 million ounces of silver, 4.1 billion pounds of copper equivalent and 8.8 million gold equivalent ounces.
On top of that is an inferred resource of 267 million tonnes, grading 0.41% copper, 0.26 g/t gold, 7.8 g/t silver, 0.66% copper equivalent or 2.4 billion pounds of copper, 2.2 million ounces of gold, 67 million ounces of silver, 3.9 billion pounds of copper equivalent and 8.2 million gold equivalent ounces.
Those estimates are based on an 0.3% copper equivalent cut-off and metal prices of US$1,400 an ounce for gold, US$3 a pound for copper, and US$18 an ounce for silver.
On November 26, 2019, the company said it had received permits allowing for up to 40 drill pads at the Anta Norte portion of its AntaKori project, a move that enables the company to properly test various geophysical anomalies which it believes may represent mineralization related to a porphyry centre (the magnetic low) surrounded by an annular ring of magnetic-bearing skarns (the magnetic highs).
To date, the company has not been able to adequately test the geophysical anomalies and has been drilling along the southern edges of the targets from currently permitted pads. “Receiving the [permits] is a significant milestone for Regulus,” said the company’s CEO John Black. “The geophysical anomalies to the north represent considerable upside for the AntaKori project and to date we haven’t been able to test them due to lack of access.”
With the permits in hand, Black said the company can mobilize a drill program in 2020 to drill what it believes to be the future of the AntaKori project.