West Kirkland Mining (CVE:WKM) said Friday it closed a $1.69 million private placement financing, consisting of the sale of 4.8 million units at a price of 35 cents each, with Newmont Mining (NYSE:NEM) (TSE:NMC) taking up a large chunk of the offering.
The gold explorer said each unit consists of one company common share and one-half of one common share purchase warrant. A whole purchase warrant entitles the holder to purchase one common share at a cost of 60 cents for a period of 18 months from the closing of the offering.
Newmont Mining's Canadian subsidiary said separately today that it acquired 2.23 million units of the company through this placement, giving Newmont around 13.4 per cent of West Kirkland, including warrants.
West Kirkland said it will use the new funds raised from the private placement toward exploration costs and for general corporate purposes.
The private placement was initially announced in late June.
"West Kirkland will continue its drilling program in the Long Canyon Trend including our high-priority targets on the 12 Mile and Toano properties," said the company's vice president of exploration, Michael G. Allen.
"Also, we will commence engineering work, following our recently announced resource estimate, on our TUG project along the Utah-Nevada border."
The company reported at the start of July surface gold at its 12 Mile property, further confirming the potential of its regional development strategy in the Long Canyon Trend, Nevada.
The samples collected from the recently constructed drill pad returned an average grade of 0.33 grams per tonne (g/t) gold and 1.00 g/t silver over around 29.0 metres*, in "well oxidized and highly altered rocks."
The gold mineralization, the company said, is in the same stratigraphic position as the TUG deposit located 10 kilometres to the east, and the company plans to add to the TUG gold deposit through regional exploration for near surface gold deposits.
West Kirkland reported that 6.1 meters of samples at 12 Mile oriented normal to structure returned an average of 0.56 g/t gold and 1.2 g/t silver. The company plans to drill around 3,000 metres in the 12 Mile area this year.
The Long Canyon Trend is delineated by the Long Canyon deposit in the south west, and TUG deposit 65 kilometers to the north east. The company holds a majority land position between the two deposits.
In early June, the company released a resource estimate for TUG of an inferred mineral resource of 679,000 gold equivalent ounces, using a cut-off grade of 0.1 grams per tonne (g/t) gold*.
The brokers of the private placement financing, PI Financial and Cormark Securities, have received a cash commission of $133,635, representing 7 per cent of the gross proceeds of the offering plus additional fees, the miner said.
Shares were up 12 per cent, trading at 28 cents Friday morning.
Data, Verification, Quality Control and Assurance
Julie Selway, Ph.D., P.Geo, a Senior Geologist with Caracle Creek International Consulting (APGO#0738) and an independent Qualified Person, verified the analytical data used to create the inferred mineral resource estimate. Sherri Hodder, P. Geo, a geologist with Caracle Creek, has visited the property.
Michael G. Allen, Vice President of Exploration for West Kirkland, and a qualified person as defined by NI 43-101, has reviewed and approved the technical information in this news release other than the inferred mineral resource estimate, including but not limited to the plans of the Company. He is the non-independent qualified person for the purpose of this news release.