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- Junior miner Black Dragon Gold (BDG) has frozen its shares until next week as it dots the I’s and crosses the T’s on an upcoming capital raise
- The details of the capital raise are set to be announced by Wednesday, August 19
- Black Dragon is working on an environmental impact assessment for its Salave Gold Project in Northern Spain
- However, the whole country has been in lockdown since early March, so progress has been slow
- The company had just under $1.2 million in the bank at the end of June after going cashflow-negative by $282,0000 over the quarter
- Shares in Black Dragon last traded yesterday afternoon for nine cents each
Junior miner Black Dragon Gold (BDG) has frozen its shares until next week as it dots the I’s and crosses the T’s on an upcoming capital raise.
The company has not yet revealed how much it plans to raise or what the cash will be used for, but Black Dragon is taking advantage of COVID-19 trading halt rules by freezing shares for four days in a row. Details of the raise are slated to be announced by Wednesday, August 19.
The company is working towards an environmental impact assessment (EIA) for its flagship Salave Gold Project in Northern Spain. However, the COVID-`19 pandemic is throwing a spanner in the works.
In the first quarter of the year, Black Dragon began preparing a final mine restoration plan which was to be followed by the EIA. However, Black Dragon said the coronavirus brought the entire country into lockdown in early March, and citizens are still behind closed doors.
As such, talks with necessary regulatory authorities in Spain have been put on hold, with no clear deadline as to when work will go back to normal.
In light of this, the company has had to delay some test-work and field studies necessary for the EIA.
This means that Black Dragon is still a while away from earning cash through gold sales, but is still spending money every quarter on staff and some exploration costs. Perhaps the upcoming capital raise is simply designed to give Black Dragon some more breathing room while the COVID-19 situation remains uncertain.
Still, the company had just under $1.2 million in the bank at the end of June after going cashflow-negative by $282,000 over the quarter. This means at current spending levels, the company can still operate comfortably for more than four financial quarters.
Whether the upcoming capital raise is just a balance sheet top-up or something bigger will be revealed next week.
Shares in Black Dragon last traded for nine cents each yesterday afternoon.
