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Sierra Nevada Gold Inc (ASX:SNX) is set to raise $2 million in a capital raise whose funds will be plugged into an upcoming drilling program and expanded exploration for silver at the company’s Blackhawk Epithermal Project.
SNX has received commitments for a Placement worth $2 million, in which shares were priced at five cents ($0,05) each, with both existing and new shareholders taking part.
The key focus of the capital raising is funding a 1,500 metre drilling program at Blackhawk to follow up previous results yielding grades of up to 1,270 grams per tonne in silver at the Endowment mine found within the play.
In this, the company has been guided by not only significant drill results, but also extensive veins of silver and gold mineralisation – mapped at surface over 22.5 kilometres – which will provide priority drill targets in the coming campaign.
Recent sampling work has also picked up strong grades across several commodities at the Two Shovels mine, which is proximal to Endowment, including 5,180 grams per tonne silver, 2.82% copper and 384 grams per tonne silver, and 0.2% copper from mine dumps and outcrop.
SNX Executive Chairman Peter Moore said he was pleased with the shareholder support shown during the placement.
“With these funds, we are well-positioned to accelerate our exploration efforts at Blackhawk to target the high-grade silver and gold mineralisation in veins at surface,” he said.
“The results received from the outcropping mineralisation at Blackhawk were exceptionally high-grade and extend over a significant area, representing significant value for SNX. We are very excited to commence our drill program imminently to unlock the potential within this system.”
SNX shares fell on the news, and at 12:24 AEDT, they were trading at 4.9 cents – a drop of 12.5% since the market opened.
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