Gold Mountain’s Wabag exploration well funded by $5.4m raise
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Shareholders and investors have backed Gold Mountain’s $5.4m capital raising, supporting the exploration at its flagship Wabag project in Papua New Guinea.
The raising consists of a $5.1m rights issue of shares priced at 2c each that closed significantly oversubscribed, leading to the company undertaking a $281,834 placement to accommodate part of the excess demand.
Gold Mountain’s (ASX:GMN) rights issue and placement includes one free attaching option exercisable at 4c and expiring in 18 months for every three shares subscribed.
The proceeds will be used to make Gold Mountain debt free and for general working capital and most importantly it will fund a 6,000m to 8,000m diamond drill program at the highly-prospective Mt Wipi target, a detailed airborne geophysical survey, a review of the extensive geological database for the highly prospective Monoyal and Sak Creek target areas, and continued regional exploration.
Chief executive officer Tim Cameron noted that the strong response to the rights issue demonstrated the continued commitment of shareholders to the company along with their enthusiasm for the future as it progressed targeted exploration at Wabag.
“In the near term I am particularly excited about the drilling program at our six drill-ready targets in Mt Wipi and uncovering the potential at both Lombokai Creek and the new target that has just been identified at Mt Nemai,” he added.
Gold Mountain recently uncovered a further three targets at Waa Creek within the Mt Wipi prospect, increasing the number of drill-ready targets up to six.
Its porphyry expert Phil Jones is keen to get to grips with Mt Wipi, where the company’s work over the last 12 months has resulted in the prospect going from a single copper-rich sample to a highly anomalous area with multiple drill targets with potential for porphyry copper-gold and associated skarn-style mineralisation.
He noted earlier this month that the company’s data show geochemical continuity and tenor between zones and has highlighted lithology and structure.
Highly anomalous copper-molybdenum mineralisation associated with diorites and quartz feldspar porphyry were observed in the northwest portion of the grid while highly significant porphyry pathfinder element anomalies straddling a non-mineralised interpreted intrusive were noted in the southeast.
Importantly, the zones have since been shown to be part of a large, complex and anomalous geochemical system within which the six major targets have been identified for drilling.
Jones has also identified an area at Mt Nemai that has serious potential for the definition of further porphyry style mineralisation with outcropping malachite, chalcopyrite and molybdenum. Significant alluvial gold has also been identified in the adjacent Laraket Creek while a rock chip collected close to Mt Nemai returned an assay of 12.5 grams per tonne gold.
This article was developed in collaboration with Gold Mountain, 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.