Red Mountain Mining’s (ASX:RMX) strategic financing partner Bluebird Merchant Ventures Ltd has increased Stage 1 funding to US$1.7 million from US$1 million.
This is an endorsement of Batangas Gold Project in the Philippines and allows the company to complete the Definitive Feasibility Study as well as all permitting requirements.
Bluebird will be allowed to earn a 25% stake (formerly 15% stake) in Red Mountain Mining Singapore Ltd, the subsidiary company that holds RMX’s Batangas Gold Project assets in the Philippines.
In December 2014, the company signed a binding Strategic Financing Partnership Agreement with London backed, BVI registered Bluebird for US$5.5 million in financing.
It has also extended the Controlled Placement Agreement (CPA) with Acuity Capital Investment Management Pty Ltd (Acuity Capital) for a further 12 months from 30th September 2015.
The CPA provides Red Mountain with access to standby equity capital of up to $3 million over the 12 months.
The company recently raised $600,000 through its share purchase plan priced at $0.0025. Shares in RMX last traded at $0.003.
Jon Dugdale, managing director, commented:
“We are very pleased that our strategic financing partner has agreed to significantly increase the Stage 1 funding under the Agreement. We believe this provides a compelling endorsement of the Batangas Gold Project.
“The additional funding will provide the opportunity to carry out the planned new drilling program and fast track completion of the DFS and all permitting inputs to allow development of the Batangas Gold Project.”
Recent Activity
Recent surface rock chips returned up to 151.6 grams per tonne gold while trenching has defined a 40 metre strike length extension that is open to the southwest towards Japanese Tunnel and will be tested in an upcoming drill program.
Results from trenching include:
- 7 metres at 20.5g/t gold (Trench 50);
- 7 metres at 11.5g/t gold including 1 metre at 50.9 g/t gold (Trench 47); and
- 5 metres at 8.83g/t gold including 1 metre at 29.3g/t gold (Trench 52).
These are from trenches in the vicinity of the very high-grade surface rock-chip results made in August that included 90.4g/t gold, 23.1g/t gold and 17.9g/t gold, from extensions to the Main and Hangingwall Lodes at SWB.
Further trenching is in progress, following up previous surface rock-chip result of 31.7g/t gold from the hangingwall of the Tamarind target and test pits/shafts will be developed through the colluvium covering the Tamarind target.
RMX plans to drill test the SWB Extended target to upgrade existing resources of 221,000 tonnes at 6.3 g/t gold as well as the Tamarind target, which offers potential for a brand new SWB-sized system based on the size of the soil anomaly in that area.
The Batangas Gold Project currently has a global JORC 2012 Indicated and Inferred Resource of 6.19 million tonnes at 2.2g/t, or 444,000 ounces of contained gold.
Analysis
The increased Stage 1 funding from Bluebird Ventures is a clear endorsement of Red Mountain Mining’s Batangas Gold Project.
This will enable the company to carry out the planned new drilling program, fast track completion of the DFS and all permitting inputs to allow development of the Batangas Gold Project.
Upcoming drilling will test both the SWB extension and Tamarind target.
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