West Wits has secured funding to install utility and infrastructure at Qala Shallows. Pic: via Getty Images.
West Wits’ Qala Shallows gold mine to be developed ‘in one of the most favourable price environments in recent history’
Mining
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- West Wits raises $1.2m through placement priced at 1.1c per share to sophisticated and professional investors
- Proceeds will be used for installation of utility and infrastructure, site management and production planning at Qala Shallows
- Funds will also be used to extend the Mining Right with a new Prospecting Right and for working capital
Investors have demonstrated their support for West Wits’ push to develop its Qala Shallows gold project by backing a $1.2m placement.
The 924,000oz Qala Shallows is the first part of the company’s broader 4.28Moz Witwatersrand Basin project in South Africa that is undergoing development.
This scale shouldn’t be surprising to anyone, given that the prolific Witwatersrand formation that it sits in hosts some of the world’s largest known gold reserves and has produced over 1.5 billion ounces of the precious metal.
A recent update to its DFS highlighted a remarkable 105% increase in free cash flow to US$522m and an increase in gold production from 43,000oz pa to 51,000oz pa over 17.7 years with steady state production at 70,000oz pa for 9 years.
Provisions for potable water for the proposed mine is in place along with power supply from City Power.
The advanced nature and attractiveness of Qala Shallows has led West Wits Mining’s (ASX:WWI) largest shareholder Wingfield Partners to express formal interest and indicative terms for the provision of a US$10m debt facility.
This adds to the $24.5m financial indicative loan sum from the Industrial Development Corporation of South Africa that the company has already secured, taking the total loan facilities up to ~US$26m – almost 50% of the total funding requirements over the three-year build-up phase.
More funding secured
WWI has now received further support for its Qala Shallows development plans with existing and new unrelated sophisticated and professional investors providing firm commitments for a $1.2m placement priced at 1.1c per share.
Proceeds from this placement will be used for installation of utility and infrastructure, site management and production planning at Qala Shallows, the new Prospecting Right application and for working capital.
“While our project debt funding arrangements are building, West Wits requires working capital to complete the rest of the work ahead to commence development of the Qala Shallows project,” chairman Michael Quinert said.
“With gold now trading around US$2,000 per ounce, the timing for West Wits’ gold project is good. Thanks again to those shareholders who have been steadfast in their support of the company.
“We are now on the cusp of developing South Africa’s newest gold mine in one of the most favourable price environments in recent history.”
This article was developed in collaboration with West Wits Mining, 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.
