Nexus Minerals Ltd (ASX:NXM) is undertaking a share placement to raise capital to fund the advancement of the Pinnacles gold project located 120 kilometres from Kalgoorlie.
This includes the resource drill out of the Pinnacles East resource area and associated mine development studies.
The funds will also allow for the acceleration of the company’s regional exploration program across the highly prospective 100 square kilometre Pinnacles tenement package.
Nexus is expecting assays in September from two recently completed drill programs within Pinnacles.
Within the Pinnacles project exists the Pinnacles JV with mid-tier gold producer Saracen Mineral Holdings Ltd (ASX:SAR).
The company has an opportunity to significantly grow the gold resource base and with it a near term production profile.
Nexus recently completed a six hole, 2,244 metre Pinnacles gold resource extension drill program.
It is testing extensions to Pinnacles East which previously delivered 8 metres at 7.7 g/t gold; 7 metres at 5.9 g/t gold; and 3 metres at 9.8 g/t gold.
Initial results are expected early September 2016.
A regional six hole, 825 metre drill program was also recently completed testing two target areas.
Initial results are expected late September 2016.
Nexus entered into a farm-in and joint venture agreement over the Pinnacles JV Gold Project
with Saracen in late 2015.
Under the agreement, Saracen will buy any ore produced and process it at their 2.4 million tonnes per annum mill at Carosue Dam Mining Operations, just 13 kilometres to the north of the project.
Nexus has full access to Saracen infrastructure, haul roads and camp facilities.
The Pinnacles gold project represents an opportunity to significantly grow the gold resource base and with it a near term production profile.
This capital raising exercise will provide Nexus with sufficient funding to take the Pinnacles JV project to a decision to mine.
Furthermore by securing funding it will de-risk the medium term production opportunity for Nexus.
Nexus is highly leveraged to exploration upside as it awaits assay results from two completed drilling programs at Pinnacles.
The stock price has been performing very well recently, up 150% over the past 3 months, currently trading at $0.205.
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