Old Cuban woman looking for a match to fire her cigar. Havana, Cuba.

Cohiba Minerals will raise $1.6 million to fast track exploration at its Horse Well project, just 2km from BHP’s spectacular Oak Dam copper discovery in South Australia.

A “desktop” review identified the Horse Well project lay in the same geological setting as Oak Dam, the company told investors earlier this week.

After the placement – comprising 1.6.6 million new shares at 1.5c each — Cohiba (ASX:CHK) will have about $2.7m in the bank.

The 1.5c issue price is a massive premium on the 0.5c the stock fetched prior to the neighbouring BHP discovery on November 27.

Cohiba told investors the extra cash would help the explorer “accelerate planned exploration works at the Olympic Domain tenements and provide working capital to identify and assess further opportunities”.

Cohiba Executive Director Mordechai Benedikt said the capital raising got “overwhelming support” from a number of institutional, professional and sophisticated investors.

“We are excited to now commence a systematic exploration program on the Olympic Domain project area with a particular focus on Horse Well,” Mr Benedikt said.

The Cohiba share price — which has traded between 0.5c and 2.6c over the past year — was down 5.5 per cent to 1.7c in morning trade.

Stockhead is seeking comment from Cohiba.