Minera IRL Ltd (AIM, BVL: MIRL, TSX: IRL) said it has filed a short form prospectus with regulators in Canada regarding a planned share offer that is to raise up to C$25 million before expenses.
The planned fundraising also envisages an over-allotment option to buy shares that represent 15 percent of the shares sold under the initial offer.
Minera plans to use the money for advancing the company's Ollachea and Don Nicolas projects in Peru and Argentina, and for working capital and general corporate purposes.
The offering will be completed by a syndicate of investment dealers led by Cormark Securities Inc. Final pricing and the number of shares are to still to be determined.
Minera IRL is the Toronto, London and Lima listed holding company of precious metals mining and exploration companies focused on Latin America. It operates the Corihuarmi gold mine and the emerging Ollachea gold project in Peru as well as the Don Nicolas project in Argentina.
Fox-Davies Capital issued a note on Minera IRL this morning, saying any money raised in this listing will be welcome. “Although Minera had $13m cash on hand in the last release (April), it has a massive drilling programme underway. Whilst this is being hugely successful, it does consume funds and there is also the prefeasibility study for Ollachea to fund,” the broker added.
Earlier this week, Minera announced that drilling results from the new Concurayoc Zone at the Ollachea gold project in Southern Peru warrant a major follow-up drilling program in this zone. The new zone is relatively close to the Minapampa Zone, where the group has identified an inferred resource of 1.3 million ounces of gold - 8.9 million tonnes at 4.5 grams gold per tonne - and is currently undertaking a pre-feasibility study.
While two drill rigs are presently committed to the Minapampa pre-feasibility drill out, further follow-up drilling at Concurayoc will represent a high priority as additional rigs become available.
Also this week, Minera IRL reported that the feasibility study for the Don Nicolas gold project in Patagonia, Argentina, is well underway. Two rigs are now engaged in extension and in-fill drilling on the Sulfuro Vein at La Paloma and when completed, expected by the end of June, will move on to a similar exercise on the gold mineralization at Martinetas. This will allow the resource to be substantially categorized as Measured and Indicated Resource.
Don Nicolas currently has an Indicated Resource of 1,078,000 tonnes at 5.8 g/t for 200,700 ounces of gold and an Inferred Resource of 1,075,000 tonnes at 4.6 g/t for 158,400 ounces of gold.