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Ord River Resources Launches $4.9m Funding Program To Advance Gold Focused Drilling At Suplejack

The Rights Issue has been underwritten up to the first $2.5 million, with Patersons Securities underwriting $1.8 million and the other $650,000 underwritten by an existing Ord shareholder.

The largest chunk of the money raised, $2 million, is expected to be put towards a drilling program at Ord's Suplejack Gold Project in the Northern Territory.

Suplejack is wholly owned by Ord River, and has an existing 55,000 gold ounce JORC Inferred Resource.

The project is located close to other gold mines, and existing established infrastructure, which importantly includes gold processing facilities.

Suplejack is just 10 kilometres north of ABM Resources' (ASX: ABU) Hyperion Gold Project and 30 kilometres north of Tanami Gold's (ASX: TAM) Groundrush Gold Mine.

Ord company secretary and executive director Frank Zhu told Proactive Investors today that the drilling program is aimed at increasing the Resource at Suplejack.

The company plans to undertake about 2,400 metres of drilling in the second half of 2012.

A further $1.5 million of the money is targeted for the potential IPO costs of Sino Australian Resources (SARCO).

The IPO is targeted for the end of 2012, conditional on a number of factors.

Zhu told Proactive Investors that the potential IPO would help raise funding for the company's bauxite/alumina project in Laos.

SARCO is a joint venture company which is 49% owned by Ord River and 51% owned by China Nonferrous Metal Industry's Foreign Engineering and Construction Company (NFC).

Other funds raised through the rights issue will be used for exploration work at the West Wyalong Gold Project in New South Wales and a maintenance program at the Copper Flats Project in Western Australia.

Rights issue

Ord is offering shareholders three fully paid shares for every eight shares held, at an issue price of $0.028 per share.

This is a 31.1% discount to the company's 30 day volume weighted average price prior to the announcement, and a 22.2% discount to its final closing price before the announcement.

The Rights Issue will result in the issue of up to 178 million new shares.

Zhu said the offer should be attractive to shareholders as it is very competitively priced and will not dilute their shareholdings.


At the bauxite/alumina project, SARCO is focused on building a 600,000 tonne per annum alumina refinery in Laos.

In addition, the company is in the final stages of a JORC Resource update for the Yuqida prospect, which follows a 300% increase in the LSI tenement in late 2011.

Yuqida has an existing Indicated Resource of 110 million tonnes at 23% available aluminium, while the updated Resource at LSI is 77 million tonnes at 23% available aluminium with a 10% aluminium cut-off grade.

Proposals for a Bankable Feasibility Study at the project are being assessed.

Zhu told Proactive Investors the IPO would cover about 30% of the project costs, with the other 70% expected to come from project financing.

SARCO is looking to joint ventures and ore offtake agreements as options to support LSI. The company has already received a letter of proposal from a large Chinese bank.