Investors have confirmed their strong support and enthusiasm for Alicanto Minerals’ growing Sala zinc and silver project in Sweden, helping the company raise $3 million to fund further exploration at the project.
Alicanto (ASX:AQI) secured the funds in a placement to both existing shareholders and new international and domestic investors at 5c a share.
Indicating their unwavering interest in the project, the largest undeveloped zinc-silver deposit in the mining-friendly Scandinavian nation, that was just a 2% discount to Alicanto’s last traded price of 5.1c.
Junior explorers typically have to raise money at far larger discounts, showing just how keen rock geeks are to see more drilling take place at the high grade deposit.
A maiden inferred resource last month confirmed its global scale, including 9.7Mt of ore at 4.5% zinc equivalent with a 2.5% ZnEq cut-off and a high grade core from surface of 4.5Mt at 6% ZnEq (4% cut-off).
Mineralisation remains open in all directions, with Alicanto’s bounty of 311,000t of zinc, 15Moz of silver and 44,000t lead just the beginning.
Matter of priority
This high grade breccia zone which contains intersections like 4.7m at 24.4% Zn, 875g/t Ag and 3.7% Pb, will be the first focus of a drill program to investigate the high grade core and expand the definition of the current Sala resource.
The mine has historically produced over 200Moz of silver at grades of up to 7000g/t and is located in the top tier Bergslagen region of Sweden, home to the world class Garpenberg and Zinkgruvan mines.
Given Alicanto is the first explorer to really apply modern exploration techniques to the deposit, a sustained drilling effort is expected to keep growing the scale and quality of the Sala resource.
“The strong drilling results and the fact we outlined a JORC Resource within a year of acquiring the project highlights the size of the opportunity at Sala,” Alicanto chairman Ray Shorrocks said.
“The simple fact is that the more we drill, the more mineralisation we find. In light of this success, we intend to accelerate our exploration program with the aim of unlocking the value of Sala as quickly as we realistically can.”
Sweden is close to battery and industrial supply chains, with its long mining history and local knowledge making Sala a key project for the transition to a sustainable society.
Terms of the offer
The first tranche of 26.9 million shares ($1.3m) issued in the Canaccord Genuity led placement will be settled by September 7 under Alicanto’s existing placement capacity.
The second $1.7m tranche will be subject to approval by shareholders at Alicanto’s AGM, expected to take place in October.
Funds raised from the placement will be used to expand the known mineralisation at Sala, cover the costs of the offer and provide Alicanto with working capital.
This article was developed in collaboration with Alicanto Minerals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.