Central Asia Resources (ASX: CVR) will place 41.2 million shares at 3.2 cents each to raise A$1.3 million to advance the Dalabai 0.5Mtpa heap leach project located in Kazakhstan, and undertake an independent review of the prospectivity of the Bizhe licence area.
Nojood Holding Company WLL, an existing shareholder, has subscribed for 41.2 million (15% of shares on issue) shares which will be paid for and issued in 2 equal tranches.
The first placement will occur this week, the second will be made in January 2011. This share issue does not require shareholder approval.
The funding will be used to progress permitting and approvals required to bring the Dalabai gold project into production in 2011. Dalabai is a low risk, low capital heap leach operation two hours drive north of Almaty, the largest city in Kazakhstan.
Further funding will be required before construction can commence, and is expected in February 2011.
The Dalabai project currently has a resource of 97,000 ounces of gold and 1.36 million ounces of silver. Commissioning of the 0.5Mtpa heap leach facility is planned for Q3 2011 and will have an approximate annualised production of 20,000 ounces gold and substantial silver.
Central Asia holds a 90% interest in Onzhas LLP which indirectly holds the Dalabai licence.
The company’s project areas are close to Almaty, and has well established road, rail and telecommunications infrastructure.
CVR shares rose 14% to A$0.03 in trading this morning.