MOD Resources Ltd (ASX:MOD) has received firm commitments to raise $12 million in an oversubscribed share placement to institutional and sophisticated investors at $0.047 each.
The placement will be followed by a fully underwritten rights issue to raise $6.3 million from existing shareholders on the same terms.
MOD will apply the funds raised from the placement and rights issue to expand the company’s exploration activities across its regional holdings in the Kalahari Copper Belt, Botswana.
Starting early in the June quarter, MOD plans to commence drilling of high priority targets identified within the extensive T3 Dome area and subsequently in the T20 Dome, 100 kilometres to the west.
Project background
Last year, MOD revealed an updated resource of 36 million tonnes at 1.14% copper containing 409,000 tonnes of copper and 14.8 million ounces of silver at its 70%-owned T3 copper-silver deposit.
MOD’s pre-feasibility study earlier this year for a proposed open pit mine and copper concentrator indicates a financially robust project generating circa US$730 million EBITDA over 9 years.
Following the recent drilling at T3, an updated resource is expected to be reported in the June quarter 2018.
READ: Mod Resources looks to extend the mine life of T3 copper project
The new funds will be applied to a major expansion of exploration activities along the T3 Dome, T20 Dome and across the company’s wider 12,600 square kilometres of regional holdings.
This will complement MOD’s current drilling underway designed to advance three resource projects (T3 Pit extension, T3 Underground, T1 Underground) and test the T-Rex exploration target.
Eight drill rigs are operating at T3 and T1 and this number is expected to increase to test other targets.