Manuka investors chip in $2.4m as gold production restart nears
Manuka Resources has bolstered its balance sheet on the cusp of the restart of gold production at Mt Boppy after keen investors tipped in a further $2.4m.
Manuka Resources (ASX:MKR) has successfully completed a $2.4m two-tranche placement.
The company said the placement was strongly supported by a very small number of professional and sophisticated investors, the majority of whom were existing shareholders.
Manuka is restarting gold production at its Mt Boppy mine in NSW’s Cobar Basin after a preliminary evaluation showed the economic viability of treating a screened product at the Wonawinta plant. Further test-work has been completed which now confirms the projects commencement.
The company’s forward looking production plan underpins a ~3-4 year gold production scenario targeting up to 25,000oz a year.
The ~1Mtpa+ Wonawinta mill can produce both gold and silver and is production ready.
The current strong gold price and superior economics of the Mt Boppy gold mine has prompted Manuka to favour gold production over silver production for the time being.
It’s an opportune time to be moving back into gold production with the price of the safe haven metal not far off its all-time record and this week punching above the $3,000 Aussie dollar mark.
To finalise the placement, Manuka issued 17.9 million shares at 6.13c each and 20.155 million shares at 6.45c each.
Pricing of the shares was based on a 10-day volume weighted average price with no discount.
Participants also received one free unlisted option, exercisable at 13c before the end of December 2023, for every two shares subscribed for.
Manuka plans to use the fresh cash injection for general working capital and to help fund the transition to gold production. The transition is already underway with revenues from gold sales expected to commence in the next 4-6 weeks.
This article was developed in collaboration with Manuka Resources, 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.