Solomon Gold (AIM: SOLG) has secured strong shareholder support for a placement to raise A$3.4 million to fund ongoing exploration at its Rannes gold and silver Project in Queensland.
The company will issue around 28.7 million shares at £0.08 (A$0.12) per share to institutional and private investors.
At Rannes, Solomon Gold is nearing an upgraded Inferred Resource, due before the end of March, as it continues to target 2 million ounces of gold equivalent.
The current Inferred Resource, which was upgraded by 20% in November last year, is 812,000 ounces of gold equivalent comprising 486,935 ounces of gold and just over 13 million ounces of silver.
Rannes has a very competitive discovery cost of A$6.70 per ounce versus an average of $60 per ounce in Australia. At a conservative resource ounce valuation of A$70 per ounce, Rannes is worth $57 million.
The funds raised through the placement will be used for:
- further resource drilling at the Kauffmans and Crunchie prospects;
- preliminary metallurgical testing and planning for Scoping Studies;
- drill testing of the multitude of surface anomalies in the vicinity of the main prospects; and
- exploration throughout the 30 kilometre long belt comprising additional soil sampling and geophysical surveys to define additional targets for drilling.
Drilling on the Kauffmans and Crunchie Prospects continue to deliver strong drill intercepts, which will be incorporated in the new resource upgrade.
At Crunchie highlight intercepts include 5 metres at 1.9 grams per tonne (g/t) gold and 211.2g/t silver, and 4 metres at 2.6g/t gold and 86.5g/t silver.
While at Kauffmans drilling has returned a best result of 28 metres at 0.8g/t gold and 11.1g/t silver.
Solomon Gold is undertaking a comprehensive review of new gold-copper opportunities in the southeast Australasian region and in Central and South America.
The company recently acquired three new early stage exploration properties with low minimum spend requirements in the Solomon Islands.
The licences, which span 389 square kilometres, have returned encouraging gold geochemical and geological results, including anomalous gold from stream sediment sampling, during early stage exploration.