Reunion Gold Corp. [RGD-TSXV] said Tuesday it has raised $70 million from a bought deal financing and will use part of the proceeds to advance the company’s Oko West project in Guyana to the next stage of development.
The company said an underwriting syndicate acquired 152.2 million shares at 46 cents per share. It also said the underwriters have been granted the option to purchase an additional 15% of the offering to cover over-allotments, if any. The green shoe option remains open for 30 days after closing.
“We are very pleased to have successfully closed this financing in what we know is a challenging market for investors,’’ said Reunion President and CEO Rick Howes. “We are delighted to welcome La Mancha Investments S.a.r.l. as a shareholder of the company,’’ he said.
On September 25, 2023, Reunion shares closed at 43 cents and currently trade in a 52-week range of 59 cents and 28.5 cents.
Reunion is a focused on the exploration and development of gold projects in the Guiana Shield area of South America, including Guyana, French Guyana and Suriname.
The company recently said metallurgical results continue to confirm the robustness and strong economic characteristics of the Oko West project.
“These results represent one of the many studies that will comprise our preliminary economic assessment (PEA), which we expect to release by the end of 2023 or early 2024,’’ said Howes.
The Oko West project is in the Cuyuni Mining District, about 95 kilometres west of Georgetown and is accessible by roads and trails from the town of Bartica or by boat using the Cuyuni River.
The project covers 11,900 acres of mineral rights held by local Guyanese entrepreneurs. Reunion entered into agreements entitling it to conduct exploration activities and acquire a 100% in the project area.
Back in June, 2023, the company announced an initial pit-constrained mineral resource estimate for the Kairuni zone at Oko West. It consists of 2.47 million ounces of gold in the indicated mineral resource category, grading 1.84. g/t gold. On top of that is an inferred resource of 1.76 million ounces of gold at a grade of 2.02 g/t gold.
Howes said the maiden resource confirms Oko West as a quality multi-million-ounce gold discovery with the potential for further growth. He said in just 22 months of drilling, the company has outlined a sizeable resource containing 60 to 100 metre thick saprolite cover, good grade continuity over a 70 metres average thickness to a depth of over 600 metres and with grades well above industry average.
“Further work is planned to both grow and infill this maiden mineral resource estimate, which remains open for further expansion, particularly at depth” he said.
In addition, the company continiues to explore several other promising targets on its prospecting license, including the Bryan, Takutu, and Carol zones.