Vancouver — San Gold’s (SGR-V, SGRCF-o) coffers will get a healthy top-up with a $20-million bought-deal private placement.
San Gold, which operates the Rice Lake mine 230 km northeast of Winnipeg, Man., says proceeds from the placement, being arranged by a Dundee Securitiesled syndicate, will fund further exploration of recently discovered high-grade gold in the Hinge zone at the Rice Lake mine and the development of the Cartwright and Gabrielle zones.
San Gold will issue nearly 13.4 million flow-through shares at $1.50. The deal is set to close Oct. 15 and there will be a four-month hold on the shares issued.
The Rice Lake mine contains 894,000 proven and probable tonnes grading 7.37 grams gold per tonne, with a further 875,000 tonnes grading 8.22 grams gold in the measured and indicated categories.
Recently, the company discovered the Hinge zone — beyond its reserves– about 1.3 km below surface and accessible from the mine’s underground workings. Some of the best results from Hinge included 6.4 metres grading 27.84 grams gold per tonne in hole 12.
San Gold has about 222 million shares issued. On news of the placement, its shares jumped 8 to close at $1.35.
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