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Chaarat Gold raises £4.1mln as it looks to finalise bankable feasibility for Tulkubash mine

“We appreciate the trust and support placed in us and will continue to do our best to justify it," said chief executive Dekel Golan.
Chaarat Gold worker looking across mountainous horizon in Kyrgyz Republic
Tulkubash is expected to be yield some 60,000 to 70,000 ounce per year.

Chaarat Gold Holdings Limited (LON:CGH) is raising £4.1mln of new capital to cover the costs of completing the bankable feasibility study for the Tulkubash heap leach gold project, in the Kyrgyz Republic.

The oversubscribed share placing was well supported by the company’s directors – with both the incumbent and incoming chairmen and non-executive directors participating – and the company highlighted that dilution to existing shareholders was minimised as applications for stock were scaled back.

Labro Investments, already a 25% shareholder, also participated in the placing as it is taking 41.7mln new shares and as a result will subsequently own a 31.7% stake.

In total, Chaarat is issuing 78.84mln new shares at a price of 5.25p in the share sale.

Dekel Golan, Chaarat chief executive, said: "The company set out to raise a modest amount of money in order to minimise dilution to shareholders.

“We were pleased with the interest and support of our existing and new shareholders and the directors. On account of the interest shown, the placing was oversubscribed and orders were scaled back.

“We appreciate the trust and support placed in us and will continue to do our best to justify it."

Tulkubash is expected to be yield some 60,000 to 70,000 ounce per year once operational.

The BFS is due to be completed by the end of next year, and it is anticipated that the permitting process in Kyrgyz will be substantially concluded in the third quarter of 2017.

Presently, the capital cost of the mine is predicted in the range of US$80-100mln.

Under the terms of Chaarat’s arrangement with China Nonferrous Metals International Mining (CNMIM) the company is required to offer the 8.23% shareholder the opportunity to subscribe for additional shares, so it can maintain its proportional equity holding in the company.

CNMIM will have a period of 15 days to take up the option.

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Article
October 18 2016

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